Santander Not Covered By British Guarantee For Savings

[no_house_and_free_mike]

Yes Aliance and Leicester are now fully merged with Santander.

They used to be treated as 2 different banks as far as the compensation scheme but this changed about 1 month a go.

So if you have 50k in A&L and 50k in Santander/Abbey then you are only protected for the first 50k.

[jonb]

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...

It is part of Bank of Ireland, which has a 100% guarantee from the Irish government.

[jonb]

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What I found interesting was that the complete guarantee, given to Northern Rock, was withdrawn.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.

It is the Cajas, basically the same as Building Societies, that lost money on property in Spain.

[Concrete Jungle]

It is part of Bank of Ireland, which has a 100% guarantee from the Irish government.

[The Bull Trap]

It is part of Bank of Ireland, which has a 100% guarantee from the Irish government.

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

Point 2 states the following - "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"

Sorry, I got my banks mixed up.

[getknk]

Can someone give a definitive answer?

https://myonlineacco...epage_legal.jsp

As per Abbey's site, santander is protected..

Also as per wording..There are lots of overeseas owned banks operating in Britain, whether its Santander, ICICI or ING Direct. Providing they're not 'offshore' accounts (which are very different), it's usually irrelevant who their parent company is. They're UK regulated banks, so you get the same £50,000 per person protection.

Can u plz confirm if Santander is covered by FSCS..

Cheers

[headmelter]

Can someone give a definitive answer?

https://myonlineacco...epage_legal.jsp

As per Abbey's site, santander is protected..

Also as per wording..There are lots of overeseas owned banks operating in Britain, whether its Santander, ICICI or ING Direct. Providing they're not 'offshore' accounts (which are very different), it's usually irrelevant who their parent company is. They're UK regulated banks, so you get the same £50,000 per person protection.

Can u plz confirm if Santander is covered by FSCS..

Cheers

From Santander web site :

We are covered by the Financial Services Compensation Scheme (FSCS). The FSCS can pay compensation to depositors if a bank is unable to meet its financial obligations.

Most depositors - including most individuals and small businesses - are covered by the scheme. In respect of deposits, an eligible depositor is entitled to claim up to £50,000. For joint accounts each account holder is treated as having a claim in respect of their share so, for a joint account held by two eligible depositors, the maximum amount that could be claimed would be £50,000 each (making a total of £100,000). The £50,000 limit relates to the combined amount in all the eligible depositor's accounts with the bank, including their share of any joint account and not to each separate account. For further information about the scheme (including the amounts covered and eligibility to claim) please ask at your local branch, refer to the FSCS website .

Hope that helps as I continue to fill out my transfer ISA forms.

[Dr Doom]

apologies if if i'm pointing out the obvious, haven't seen it mentioned elsewhere in the thread

but if you (as an individual), have over ~£30k in multiple santander banks

the £30k guarantee only applies across all the accounts, NOT EACH ACCOUNT

i think that is the main thing to bear in mind, especially considering santander own quite a few uk banks now

[Valedarius]

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

Lots of information at the above link, there is a chart half way down the page that shows you which banks (not investment companies) are standalone and which are part of the same institution.

[DTMark]

When the Icelandic bank went tits up, the UK compensated savers under the UK's scheme. Then the government went with the begging bowl to Iceland to get the money back. It appears that the Icelandic government were not disputing compensating the UK for up to £50k per bailed out account:

If Santander go under, is it the case that the UK print the money to compensate all the UK depositors (definition: depositor with a residential address in the UK?) and we then go with the begging bowl to the Spanish government for reimbursement - and are they obliged to pay us back? (Leaving aside whether or not they would be able to)

[interestrateripoff]

It is part of Bank of Ireland, which has a 100% guarantee from the Irish government.

Ultimately backed by the German taxpayer?

[SarahBell]

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

Doesn't mean they'd let you use your money though.

[headrow]

Why do some on here want a bank to go under?

If Santander went down , i'd withdraw all my money out of all the other banks and sink it in to something that i percieve as safer than leaving it on deposit in a bank. In other words housing. Thus forcing the price upwards.

[jonb]

Can someone give a definitive answer?

https://myonlineacco...epage_legal.jsp

As per Abbey's site, santander is protected..

Also as per wording..There are lots of overeseas owned banks operating in Britain, whether its Santander, ICICI or ING Direct. Providing they're not 'offshore' accounts (which are very different), it's usually irrelevant who their parent company is. They're UK regulated banks, so you get the same £50,000 per person protection.

Can u plz confirm if Santander is covered by FSCS..

Cheers

Santander UK Ltd is an English company that happens to have a foreign shareholder. It is a UK regulated bank. Bank of Ireland is an Irish company that operates over here, so it is an Irish regulated bank.

[jonb]

When the Icelandic bank went tits up, the UK compensated savers under the UK's scheme. Then the government went with the begging bowl to Iceland to get the money back. It appears that the Icelandic government were not disputing compensating the UK for up to £50k per bailed out account:

If Santander go under, is it the case that the UK print the money to compensate all the UK depositors (definition: depositor with a residential address in the UK?) and we then go with the begging bowl to the Spanish government for reimbursement - and are they obliged to pay us back? (Leaving aside whether or not they would be able to)

The Spanish government would not be obliged to reimburse George Osborne for Santander UK Ltd, Alliance and Leicester or Cater Allen as they are UK banks that pay a levy to the UK FSCS. As I explained elsewhere, the Maltese and Portuguese governments would be obliged to pay up for the other two small subsidiaries that operate here.

[The Ayatollah Buggeri]

When the Icelandic bank went tits up, the UK compensated savers under the UK's scheme. Then the government went with the begging bowl to Iceland to get the money back.

Actually, they seized Icelandic assets in the UK using anti-terrorism legislation. Were they to do something similar to our guitar-strumming friends, that would provide some entertainment to put it mildly!

If Santander go under, is it the case that the UK print the money to compensate all the UK depositors (definition: depositor with a residential address in the UK?)

In the short term, I can't see how they could have any other realistic option. As I speculated in my earlier post, if the FSCS doesn't have the money and they let depositors go down, then everyone will know that there is in effect no guarantee and the result will be the mother of all bank runs. Don't forget that Northern Rock was a relatively small player and that to a certain extent, the government managed to defuse mass-panic by arguing that it was in effect the wog in the woodpile, i.e. engaged in reckless practices that none of the big boys would have tried (in the event we later found out that Fred the Shred and his ilk were doing the same thing, but Brown and Darling managed to make the propaganda work at the time). However, a bank on the scale of Santander going bust would release a genie that would be almost impossible to get back into the bottle if it took the FSCS guarantee down with it. That possibility would leave two options: borrow or print. Given the political incorrectness and impracticality of the former, I'd further speculate that in this scenario, the latter would be judged to be the lesser of all the evils on offer.

...and we then go with the begging bowl to the Spanish government for reimbursement - and are they obliged to pay us back? (Leaving aside whether or not they would be able to)

Unless there's some EU law I don't know about (and even if there is, Spain could just ignore it, as France do whenever it suits them), then presumably Spain could argue that the principle of caveat emptor applied to Santander's UK retail depositors. I presume that it was in anticipation of a similar response from Iceland that Darling had their assets seized.

Santander UK Ltd is an English company that happens to have a foreign shareholder. It is a UK regulated bank. Bank of Ireland is an Irish company that operates over here, so it is an Irish regulated bank.

It seems to me that this anomaly should be cleaned up. Either all banks accepting money from depositors in the UK should have to opt in to the FSCS, or none should.

Edited June 22, 2010 by The Ayatollah Buggeri

[DTMark]

Actually, they seized Icelandic assets in the UK using anti-terrorism legislation. Were they to do something similar to our guitar-strumming friends, that would provide some entertainment to put it mildly!

In the short term, I can't see how they could have any other realistic option. As I speculated in my earlier post, if the FSCS doesn't have the money and they let depositors go down, then everyone will know that there is in effect no guarantee and the result will be the mother of all bank runs. That leaves two options: borrow it or print it. Given the political incorrectness and impracticality of the former, I'd further speculate that in this scenario, the latter would be judged to be the lesser of all the evils on offer.

Unless there's some EU law I don't know about (and even if there is, Spain could just ignore it, as France do whenever it suits them), then presumably Spain could argue that the principle of caveat emptor applied to Santander's UK retail depositors. I presume that it was in anticipation of a similar response from Iceland that Darling had their assets seized.

It seems to me that this anomaly should be cleaned up. Either all banks accepting money from depositors in the UK should have to opt in to the FSCS, or none should.

I had a feeling that might be the case. And that's what Mervyn King can see coming - the failure of one "too big to fail" bank which then brings down the country.

Competition is great. The more choice the better. On the other hand, given that the guarantee is supplied by our government (in effect) then why don't we simply stipulate that in order for Santander to trade here, they have to have the backing of the Spanish government and that a certain percentage of the parent company's assets have to be set aside to pay the UK back?

If Santander is as well capitalised as it claims, this should pose no problem.

Actually, I've just seen the problem with that.

[jonb]

Actually, they seized Icelandic assets in the UK using anti-terrorism legislation. Were they to do something similar to our guitar-strumming friends, that would provide some entertainment to put it mildly!

In the short term, I can't see how they could have any other realistic option. As I speculated in my earlier post, if the FSCS doesn't have the money and they let depositors go down, then everyone will know that there is in effect no guarantee and the result will be the mother of all bank runs. Don't forget that Northern Rock was a relatively small player and that to a certain extent, the government managed to defuse mass-panic by arguing that it was in effect the wog in the woodpile, i.e. engaged in reckless practices that none of the big boys would have tried (in the event we later found out that Fred the Shred and his ilk were doing the same thing, but Brown and Darling managed to make the propaganda work at the time). However, a bank on the scale of Santander going bust would release a genie that would be almost impossible to get back into the bottle if it took the FSCS guarantee down with it. That possibility would leave two options: borrow or print. Given the political incorrectness and impracticality of the former, I'd further speculate that in this scenario, the latter would be judged to be the lesser of all the evils on offer.

Unless there's some EU law I don't know about (and even if there is, Spain could just ignore it, as France do whenever it suits them), then presumably Spain could argue that the principle of caveat emptor applied to Santander's UK retail depositors. I presume that it was in anticipation of a similar response from Iceland that Darling had their assets seized.

It seems to me that this anomaly should be cleaned up. Either all banks accepting money from depositors in the UK should have to opt in to the FSCS, or none should.

Remember that Santander isn't as big as the Royal Bank of Scotland and we managed to cope with that one going down, by nationalising it. I expect that's what would happen if Santander were to go down. As it is three UK companies, the government does have the power to sieze the shares and either pay someone else to take it over or run it itself, as it did with Bradford & Bingley for example. It only has to use terrorism legislation for foreign companies.

[R K]

Santander UK Ltd is an English company that happens to have a foreign shareholder. It is a UK regulated bank. Bank of Ireland is an Irish company that operates over here, so it is an Irish regulated bank.

You mean like Lehmans UK?

I see two potential issues, which hopefully won't ever materialise :-

* FSCS isn't fully funded. Thus any bailout by the FSCS needs a political decision to bail out the FSCS.

* Santander isn't regulated in the UK even if the UK business is. In extremis would I want to get caught up in a dispute between the British and Spanish govts. central banks and regulators especially when the Spanish don't have a track record of supporting Brits who were sold illegal property in Spain and use a different currency whose politicians have explicitly stated would not help support sterling. If extreme events occurred would I prefer to be banging on my MPs door or a Spanish govt. officials door?

There are UK alternatives - I'll stick with them thanks.

People are still far too complacent about this stuff imho.

Edited June 22, 2010 by Red Karma

[SarahBell]

Remember that Santander isn't as big as the Royal Bank of Scotland and we managed to cope with that one going down, by nationalising it. I expect that's what would happen if Santander were to go down. As it is three UK companies, the government does have the power to sieze the shares and either pay someone else to take it over or run it itself, as it did with Bradford & Bingley for example. It only has to use terrorism legislation for foreign companies.

But that's like saying you can carry all four cabbages ... if someone gives you another three then you've got to grow bigger arms.

(It's friday, It's 5 to 5 and it's ...)

[lie to bet]

To her dieing-day my grandmother refused to keep her money in a bank.

She did not have a large amount, but would keep it hidden all over the house.

I remember finding this very strange, almost laughable.

She was scornfull of anyone foolish enough to leave their money on deposit, and would always tell me never to trust the banks.

Of course she had struggled through the 1930's, I had no knowledge of this.

It is amazing how such desperate times are so quickly wiped from the collective memory.

Are we about to be reminded?

It is staggering just how inept the banks and regulators have been across the world.

Be very carefull!

Work out which banks have the same FSCS numbers as other bank. They are the same bank and you will only get £50,000 for each FSCS number.

There are not that many seperate banks, and it is easy to think you are with a different bank when you are not.

The difficulty is knowing whether this will help if it all goes wrong!

[The Ayatollah Buggeri]

* Santander isn't regulated in the UK even if the UK business is. In extremis would I want to get caught up in a dispute between the British and Spanish govts. central banks and regulators especially when the Spanish don't have a track record of supporting Brits who were sold illegal property in Spain and use a different currency whose politicians have explicitly stated would not help support sterling. If extreme events occurred would I prefer to be banging on my MPs door or a Spanish govt. officials door?

But the quid pro quo is that this scenario removes a potential political barrier to us 'doing an Iceland' should anything like this happens, i.e. first we seize all Spanish-owned assets in the UK, then we have the conversation about compensation.

[right_freds_dead]

you dont have any problems with banks going under with your savings when you hold the yellow safety metal.

[ccc]

you dont have any problems with banks going under with your savings when you hold the yellow safety metal.

You really believe that....

[right_freds_dead]

You really believe that....

i believe it more than what the desk seller at the local nat west says.

your savings in a bank are no more than blips on a screen.

the ownerships of such banks are all over the place.

the compensation plan is all over the place. no thanks.

under a bed is better than in the bank at the moment.