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Santander Not Covered By British Guarantee For Savings

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May I bring your attention to an article in the blog and several comments posted by HPCers...

http://www.housepricecrash.co.uk/newsblog/2010/06/blog-spanish-banks-desperately-unloading-housing-inventory-29271.php

I know some one who is a international banker - at a board meeting of a charity we sit on she advised the board to take all of the charity's money out of the Spanish owned banks and not to touch them, this was about 4 weeks ago. She told me there was some very nasty rumours going around about a possible collapse. Her advice was the smart money is starting to get out.
number cruncher, I was told the same thing a couple of weeks ago by somebody who works in the City, they said be very carefull if you have funds in any UK bank owned by Santander as they may not be covered by the UK government if they implode.

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http://www.moneysavingexpert.com/savings/safe-savings

Every UK REGULATED account gets £50,000 protection.

All UK regulated current or savings accounts and cash ISAs in banks, building societies and credit unions are covered by the government-backed Financial Services Compensation Scheme (FSCS). So if the bank fails, you'd get back up to £50,000 per person per financial institution, usually within a couple of months.

Most banks including foreign-owned ones like Spain's Santander are UK regulated. Yet a few EU-owned banks opt for a 'passport scheme' where you rely on protection primarily from their HOME government.

Shockingly this includes the Post Office Savings brand (actually part of Bank of Ireland & covered by Ireland not UK). Plus ING Direct, Anglo-Irish, Triodos & more. See foreign banks list for full details.

Has this altered then? Have Santander moved out of UK regulation?

Edited by interestrateripoff

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May I bring your attention to an article in the blog and several comments posted by HPCers...

http://www.housepricecrash.co.uk/newsblog/2010/06/blog-spanish-banks-desperately-unloading-housing-inventory-29271.php

This is the least surprising news I've heard for ages. Financial institutions don't just miraculously grow like that. It's like Iceland all over again.

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May I bring your attention to an article in the blog and several comments posted by HPCers...

http://www.housepricecrash.co.uk/newsblog/2010/06/blog-spanish-banks-desperately-unloading-housing-inventory-29271.php

OK you've got my attention...

A joint A&L account of ours is holding our house fund. It's with the limits for protection. How can this not be covered by the savings protection scheme? If one bank is not trustworthy then surly they all aren't. Either all banks are covered or none are.

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I think they are covered by the FSCS. But if you have two accounts in two Santander owned baks before any aquisition, check carefully any correspondence.

But who will be able to bail out the FSCS?

http://www.telegraph.co.uk/finance/personalfinance/savings/7732877/Santander-savers-face-reduced-protection-from-FSCS.html

Edited by Money Spinner

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As far as I am aware they B&B and the A&L were covered and still should be as they are trading in the UK and regulated, I presume, by the FSA which is now, I presume, the BOE.

My concern is this - Labour was pro QE and savings the banks, etc, but this is a Tory Govt now... albeit it is a Tory/Lib one so that should make it prety safe re Saint Vince of Cable.

Maybe we need to start asking questions of BBC journos like Flanders, Preston and Mason? Raise some public awareness of the doubt... just in case...

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As far as I am aware they B&B and the A&L were covered and still should be as they are trading in the UK and regulated, I presume, by the FSA which is now, I presume, the BOE.

My concern is this - Labour was pro QE and savings the banks, etc, but this is a Tory Govt now... albeit it is a Tory/Lib one so that should make it prety safe re Saint Vince of Cable.

Maybe we need to start asking questions of BBC journos like Flanders, Preston and Mason? Raise some public awareness of the doubt... just in case...

Don't worry, the printing presses are being warmed up. Actually, do worry.

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May I bring your attention to an article in the blog and several comments posted by HPCers...

http://www.housepricecrash.co.uk/newsblog/2010/06/blog-spanish-banks-desperately-unloading-housing-inventory-29271.php

From there website:

The first £50,000 of each customer’s deposits held with each separate banking authorisation is 100% covered by the Financial Services Compensation Scheme. If two people hold a joint account, each person would be covered for up to £50,000 – that is a total of £100,000.

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May I bring your attention to an article in the blog and several comments posted by HPCers...

http://www.housepricecrash.co.uk/newsblog/2010/06/blog-spanish-banks-desperately-unloading-housing-inventory-29271.php

Santander UK Ltd (includes the old Abbey, Bradford & Bingley, Asda and Safeway brands, and the still current Cahoot brand) is covered by the UK guarantee.

Alliance & Leicester (includes the old National Girobank) is covered by a separate UK guarantee, but not for long, it will be moved accross to Santander.

Cater Allen has a separate UK guarantee. I'm not aware of any plans to merge this with the other registrations.

GE Capital Bank has a separate UK guarantee. Again, I'm not aware of any plans to merge this.

Santander Totta is covered by the Portuguese scheme

Banif Bank is covered by the Maltese scheme. Malta is a small country. It is 29% larger than Iceland. Although it doesn't appear to have any financial problems at the moment, that could change.

Edited by jonb

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Don't forget that when B&B went t1ts, the FSCS had to be bailed out by the Bank of England, cause of course it couldn't cover that sort of default, and the BoE had to get an indemnity from the Treasury, cause it wasn't stupid enough to take on the risk - it needed Darling to promise your money to do that.

If the Germans aren't prepared to bail out the Spanish I'd be incredibly circumspect about the British govt. choosing to do so if it all turned nasty no matter what guarantees may be in place.

Why take the risk?

There are times when return of capital is more important that return on capital.

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Reading the above I think this is a good time and a good thread to work out which banks are covered by which guarantee and who have separate guarantees?

LloydsTSB/Halifax - separate or joint?

Northern Rock - no longer unlimited I guess?

Sainsburys - did we ever get to the bottom of this?

etc,

etc,

etc,

No wonder people have plunged into house buying in the past year - not only is everyone getting near zero interest but, as I had kind of put out of my mind, the whole issue of banks going under has been forgotten by most... even though 2 banks a week are still going under in the US.

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Reading the above I think this is a good time and a good thread to work out which banks are covered by which guarantee and who have separate guarantees?

LloydsTSB/Halifax - separate or joint?

Northern Rock - no longer unlimited I guess?

Sainsburys - did we ever get to the bottom of this?

etc,

etc,

etc,

No wonder people have plunged into house buying in the past year - not only is everyone getting near zero interest but, as I had kind of put out of my mind, the whole issue of banks going under has been forgotten by most... even though 2 banks a week are still going under in the US.

Lloyds Banking Group has 7 registrations

AMC Bank

Bank of Scotland - includes Halifax, Birmingham Midshires, Intelligent Finance, St James's Place Bank, AA, SAGA, Norwich Union and the Charities Aid Foundation

Lloyds TSB - includes Cheltenham & Gloucester

Lloyds TSB Scotland

Lloyds TSB Private Banking

Sainsburys

Scottish Widows

The previous government's plans were to rename Lloyds TSB Scotland as TSB, and move Cheltenham & Glocester, some of the English Lloyds TSB and Intelligent Finance across to it. Before the election, some Tories expressed a preference for reversing the Lloyds / HBOS merger, but no formal announcement has been made since the election.

Northern Rock no longer has a 100% guarantee unless you have a fixed rate account that was opened before the guarantee was withdrawn.

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for the inflationists - crash a bank and get license to print 50k 'per person'*

*whether real of not.

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Good thread - I have 50k with B&B at the moment, which will be moving soon.

I would add though, incase no one has realised - The Post Office accounts are not covered by the 'guarentee' as the money is coming from the Anglo-Irish Bank, which is not covered...

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Santander UK Ltd (includes the old Abbey, Bradford & Bingley, Asda and Safeway brands, and the still current Cahoot brand) is covered by the UK guarantee.

Alliance & Leicester (includes the old National Girobank) is covered by a separate UK guarantee, but not for long, it will be moved accross to Santander.

Cater Allen has a separate UK guarantee. I'm not aware of any plans to merge this with the other registrations.

GE Capital Bank has a separate UK guarantee. Again, I'm not aware of any plans to merge this.

Santander Totta is covered by the Portuguese scheme

Banif Bank is covered by the Maltese scheme. Malta is a small country. It is 29% larger than Iceland. Although it doesn't appear to have any financial problems at the moment, that could change.

Joking aside, if any member of the FSCS went under and the scheme wasn't honoured, then all banks would be untrustworthy. The scheme either operates with integrity or it is worthless.

Edited by Total_Injustice

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Joking aside, if any member of the FSCS went under and the scheme wasn't honoured, then all banks would be untrustworthy. The scheme either operates with integrity or it is worthless.

Classic Ponzi.

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Joking aside, if any member of the FSCS went under and the scheme wasn't honoured, then all banks would be untrustworthy. The scheme either operates with integrity or it is worthless.

If any FSCS-covered institution went under and the depositors weren't covered, there would be a run on every UK bank pretty sharpish. If necessary (i.e. if an FSCS-covered institution went under and the FSCS couldn't raise sufficient funds to reimburse its retail depositors), I suspect that the BoE would simply print whatever was necessary. Even the inflation that would cause would be preferable to the entire system blowing up.

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If any FSCS-covered institution went under and the depositors weren't covered, there would be a run on every UK bank pretty sharpish. If necessary (i.e. if an FSCS-covered institution went under and the FSCS couldn't raise sufficient funds to reimburse its retail depositors), I suspect that the BoE would simply print whatever was necessary. Even the inflation that would cause would be preferable to the entire system blowing up.

+1

The message this would send would undermine everything. There'd be a lot of thick mattresses and assets would sky rocket.

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Don't forget that when B&B went t1ts, the FSCS had to be bailed out by the Bank of England, cause of course it couldn't cover that sort of default, and the BoE had to get an indemnity from the Treasury, cause it wasn't stupid enough to take on the risk - it needed Darling to promise your money to do that.

If the Germans aren't prepared to bail out the Spanish I'd be incredibly circumspect about the British govt. choosing to do so if it all turned nasty no matter what guarantees may be in place.

Why take the risk?

There are times when return of capital is more important that return on capital.

You might see them inforce the 50k limit, but not to honour the FSCS scheme there would be a melt down.

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I think that the taxpayer stands behind the first 50K of savings for each individual, for each 'banking group' covered by the scheme.

What I found interesting was that the complete guarantee, given to Northern Rock, was withdrawn. I think that the powers that be want to bring in a bit of 'moral hazard' even for depositors. So if another bank goes under, this time you will only get your 50K back. For the rest you will have to stand in line with all the other depositors.

Must say, I have had some doubts about Santander. Just how did they get so big so quickly? I suppose that they must have been so brilliant that they avoided that huge property bust in Spain, but must have ridden the wave upwards, and got out just in time. As have so many other banks there, after all, no banks appear to have lost money on property in Spain.

Santander, just a brilliant, well run, well capitalised, bank.

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