Icesave talks 'fail to reach resolution'

Channel 4 news have announced that all savers will get their money paid into their linked accounts next month.

Yes, it looks like we're finally getting closer to the point when Icesave customers will see some of their money returned. A new item was posted on the FSCS web site about this yesterday.

I must say its quite difficult to keep track of the real situation on this issue. I've seen a lot of contradictory reports over the last couple of days. On Thursday it was reported that the IMF was delaying agreeing a loan to Iceland until Iceland had resolved their dispute with Britain over Icesave. Then yesterday I read the report I posted above which said that talks between the UK and Iceland had closed without any agreement being reached. So what a surprise this morning to read that the IMF has now agreed to loan Iceland US$2.1 billion. Has a deal over Icesave been reached or not?

I can only assume that a lot of behind-the-scenes negotiations are going on and selected bits of information get leaked to the public as each side tries to enhance its position.

Chris

In message , Chris Blunt wrote

The number of customers has gone down to 200,000. Does this mean that the FSCS now has a reliable figures or are there approximately 100,000 customers for which there will not be an accelerated process? Perhaps those with fixed term accounts?

I'm not sure this is relevant. If the amount of the loan is what the Iceland authorities need to pay off the guarantee then they don't need the loan if they say f*** **f. The $2.1b is probably to stop them defaulting on other debts.

Or journalists don't report accurately.

AIUI there are approx 200,000 customers who, between them, have around

300,000 accounts with Icesave.

Ret.

Chris Blunt wrote: ...

That looks good news - but I'm still not clear whether I'll get my 11.5 months' interest due on the deposit :-{

I have a 2-year fixed term (monthly interest) deposit which is due to mature in August next year. I don't know whether I'll get the existing balance back when they start to release the money next month, or whether I'll get it back next August. If I have to wait until August I hope I'll get interest paid on it until then, but I don't know who would pay it. I can't imagine the Icelandic government will pay a single penny more than they absolutely have to.

Chris

Yes its all very complicated about bonds which have yet to mature... they are suggesting (on money programme on radio 4 this morning) that you can choose to encash now...or let the term run. But who pays the interest at

7.06%?...Icesave certainly can't.

And would it still be paid at 7.06% if you did choose to let the term run, or at a rate something less than that? Hopefully all will be made clear by the FSCS in the next couple of weeks.

Chris

Indeed. I'm concerned because I made a full-balance transfer of all my cash the night prior to Icesave going into administration. The transfer did not go through and the cash was put back into my account the following day. The problem is that the account is now shown as being opened on the 9th October

2008 when it was actually opened back at the beginning of the year. Because I had opted for annual interest, none has been applied to the account so far. I spoke with Icesave about this and the girl I spoke with said she would put the dates right. She hasn't done!

Ret.

I think the FSCS statement trumps though - I dont think they would risk saying most will get ££ in November if they weren't 99.9% sure of it. Imagine the fallout if there are further delays, and the savers found out that such statements were just politcal posturing ?! I'm confident(ish!), following this statement, of getting my cash in the new few weeks....!

If it operates as a standard FSCS payment then, for instant accounts, interest is payable up to the date of default. Again, if it is standard FSCS, for term deposits the scheme ususally pays on the maturity date and repays capital plus interest that would then be due.

Toom

What rate of interest do they pay? Is it the same rate as the defaulting financial institution paid at?

Chris

If it's dealt with as a standard FSCS settlement then interest on ordinary accounts is paid to the date of default. Standard settlement for term deposits would, again if it is standard FSCS, be made at the the end of the term and would include capital plus interest.

Toom

According to

00 term deposits may be retrievable without waiting for the term to end. But there may be a price to pay. But then there might not be a price to pay if interest was credited monthly. This is not clarified. But then how accurate that article is, is anyone's guess.

Do you have a reference that describes the "standard FSCS settlement"? I can see anything on the FSCS web site which explains that aspect of the refund procedure in that degree of detail. I'm particularly interested in how term deposits are dealt with.

Chris