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munimula

How Safe Is Money In The Bank?

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How safe is money saved in bank accounts?

What would happen to your money if a bank collapsed due to bad debts?

It is unlikely that banks will fold but should it be completely overlooked, Co-op recently had to write off £100M and things haven't even started getting bad. It happened in Japan and looks like it's about to happen in Iceland.

What if something unforseen does happen - how safe is money with the banks?

What protection or insurance is there that you would get your money if a bank collapsed? Is it wise to avoid those banks that are perhaps most at risk?

Edited by munimula

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If your bank is a FSA regulated Bank and is a member of the Financial Services Compensation Scheme established under the Financial Services and Market Act 2000 then you will be protected, in theory. (Forgive the cynicism).

The scheme affords 100% protection to the first £2000 of a depositor's total deposits with the Bank and 90% of the next £33,000 amounting to a maximum payout of £31,700.

So, if those two conditions are met do not put more than £ 31,700 into any one bank account.

http://www.fscs.org.uk/

Your saving are completetly safe here:

http://www.nsandi.com/

Edited by Baz63

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As to the liklihood of banks folding? No idea.

Plenty of precedents in the past. But if there was a collapse of the banking system we'll all be doomed .

It's an issue that's worried me. I'm not an expert but given the amount of debt in the West it is not an impossible scenario.

Followers of the Fannie Mae and Freddie Mac saga would agree. When I read stuff about that I always feel as if we amy be on the brink. (ie in the next 20 years or so.) so I steer away from such reading material now because it scares me rigid. (Ooer missus).

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For the rest of us it might be dangerous and scary, but rather refreshing.

If you have no savings to lose. Financial ruin refreshing?

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Guest Winners and Losers

No worries, your savings are secured against property...... :D

Yeah, no chance of property ever folding. :rolleyes: Yawn.

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In all seriousness - your cash on deposit is as safe as the bank you lend it to. If that bank lends against reliable assets, such as residential property, you can expect that even if the bank went under, your deposit would be safe, because the Bank of England would do it's best to get the bank sold onto a larger entity that safeguards the depositors funds. The same happened at Barings when ING bought them for £1.

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intresting

what happened to people who had savings with barings?

were they rembursed as easy as ABC? or was it a stressful process?

Anyone who had money with them?

Edited by notanewmember

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Guest Charlie The Tramp

intresting

what happened to people who had savings with barings?

were they rembursed as easy as ABC? or was it a stressful process?

Anyone who had money with them?

I would imagine the Dutch Bank made good the customers money when I believe they bought it for £1.

Don`t Know about the shareholders, I stand to be corrected.

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Guest Charlie The Tramp

Barings wasn't a retail bank then, so n/a.

I found this

In his wake he had wiped out the 233 year-old Baring investment Bank, who proudly counted the Queen as a client. The 1.3billion dollars of liabilities he had run up was more than the entire capital and reserves of the bank. Investors saw their savings wiped out and some 1,200 of Leeson's fellow employees lost their Jobs. Dutch bank ING agreed to assume nearly all of Barings' debt and acquired the bank for the princely sum of £1.

So it`s possible the same thing could happen if another bank went bust. A rescuer could get it for a song on the same conditions.

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Guest Winners and Losers

TTRTR and WAL.

Stop flirting!

This is a serious forum for serious discussion not a dating agency! ;)

It is? Sorry, thought I'd logged on to Mumsnet. Off I go then. ;)

TTRTR - he is just jealous cos he never gets any attention from WAL.

Edited by Winners and Losers

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If a you owe money to a bank that collapses ...... does that mean that you could pretty much walk away from the debt scot free ??

nope - the administrators will call in any secured loans straight away - but that 's ok cos nearly all secured loans are against property :lol:

and before anyone big and grey coloured asks the question, yes they can

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If a you owe money to a bank that collapses ...... does that mean that you could pretty much walk away from the debt scot free ??

If terrorists blew up a nuclear bomb over a major city somewhere (lets not make location suggestions for them), you can be certain that the bank, or the bank that buys their loan book, will want the money back regardless.

If you owe them a million & you only have £50, they want the £50.

Edited by Time to raise the rents.

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Guest Winners and Losers

If terrorists blew up a nuclear bomb over a major city somewhere (lets not make location suggestions for them), you can be certain that the bank, or the bank that buys their loan book, will want the money back regardless.

If you owe them a million & you only have £50, they want the £50.

Has it taken you all this time to research your post on t'internet??

Edited by Winners and Losers

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Guest Winners and Losers

Not sure what you mean by that.

You're looking good tonight TTRTR, have you done something with your chins???

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OK, I should have said "unsecured" debts ...... and if I transfer all my assets (bought with the money I owed the bank !) could I get away with the preverbial £50 if I show them that's all I had ??

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  • 336 Brexit, House prices and Summer 2020

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