kev2006n:

Does the attached link offer a glimmer of hope?

http://www.landsbanki.is/english/aboutlandsbanki/pressreleases/?NewsID=13284

Unfortunately not, as far as I can see. It seems to me that the Icelandic government is only concerned about the protection of their own citizens' deposits. Landsbanki are still allowing them to withdraw their (also our) money. If we are not going to be protected by the Icelandic government then surely we need to be protected by our own. We trusted the assurances we were given on the Icesave website.

To those who are basically saying 'I told you so', I can only say that find your lack of compassion deeply depressing. Not everyone is a money expert or even reads the financial pages of the newspapers. I don't doubt in future that we will be doing but these are unprecedented times (at least in my life time) and I believed the assurances I was given. I also didn't want to suddenly force the bank into collapse by adding to the panicked withdrawals. Naive? Perhaps. But it's hardly a crime which should bar me (and all the others) of compassion.

I am a self-employed author and have used my Icesave account to deposit all earnings, both for tax and living purposes. One of the things that attracted me to the account was the ability to set up regular payments out of it without losing interest, in effect paying myself a salary. I did this as a way of managing my monthly money. Even if we do receive compensation eventually, I have no means of paying my rent in the meantime, nor my bills and basic living expenses.

Does the attached link offer a glimmer of hope?

http://www.landsbanki.is/english/aboutlandsbanki/pressreleases/?NewsID=13284

can a 2nd a/c holder be added before any insolvency and one's safety net raised 2 £100000 do u think?

.............unless of course the 'split' which I referred to means that effectively Icesave is passed over to UK ownership be that Nationalisation or to another bank.

It is also likely that the $700B US rescue package will or could be used to help non US banks operating inside the US, therefore its just possible that said UK rescue may do the same.

isioth, the impending rescue package that you refer to is partial nationalisation of UK banks - there is no mention of anything that will help Icesave depositors.

Looks like a rescue package in the offing - not sure how this affects Icesave and I guess that will depend on what the 'split' actually involves http://news.bbc.co.uk/1/hi/business/7657422.stm

Whatever, this is surely going to go a long way at restoring some confidence in the banking system.

Talking of foreign investment in Icelandic banks - did you know that a member of the Qatar royal family is the third largest shareholder in Kaupthing? Perhaps middle eastern oil money/investment might also be called on to help bail out the country's economy.

http://www.ft.com/cms/s/0/0dcf8fec-88c1-11dd-a179-0000779fd18c.html

I would be absolutely amazed if UK account holders were cast adrift by the UK government. It would indeed set a prescedent. At the end of the day, ICESAVE are (presumably) registered and therefore approved by the FSA with the knowledge that Britons would be depositing savings with them. As such, they would have been thoroughly vetted so one would think there is some responsibility on the FSA, BofE and the Treasury to ride to our rescue - as they have done with (eg) Northern Rock. For all intents and purposes ICESAVE is a UK bank.

The real Cynic in me would point to the fact that Gordon is fighting from a corner right now and what he certainly doesnt need is 300,000 IceSavers deciding right now that whatever happens they WON'T be voting labour at the next General Election!

It seems however that there is indeed some reciprocal agreement between the Nordic countries (excl Finland) to come to each others aid in times of economic crisis. One would hope therefore that if the Icelandic govt cannot afford to bail out the compensation scheme (and figures of £4.5B have been touted), then Norway, Sweden & Denmark would jump in.

Also worth noting that the Russians are by all accounts sniffing around and offering cash injections - apparently a delegation from the Icelandic govt is planning on heading to Moscow "this week". This does potentially make sense from a Russian strategic foreign policy view point as Iceland is a former cornerstone of NATOs submarine defence barrier into the North Atlantic. With the current resurgence of a 'cold war' one might suspect that in return for roubles, Iceland would be 'asked' to refrain from agreeing to such a role in the future. Iceland themselves have virtually accused the rest of the world (UK/US???!) of deserting them at this time of crisis, so Russian overtures may seem rather attractive whatever the 'payback'.

In summary, whether its the Treasury, the Icelandic comp fund, or the Icelandic govt - with Russian or Nordic money, one would hope that Icesave depositors money is fairly safe (up to a limit of course - though lets see what tomorrows news brings with regard to a Treasury rescue package).

That's just scaremongering rikkix. The UK government backs the FSCS, and the GDP of the UK is enough that the UK government would be able to handle any UK deposit bank's demise, or several of them. The problem in Iceland is that they are a small country (300,000 inhabitants, equal to the number of Icesave UK depositors!) and stretching their government's finances to cover the guarantees is not to be taken lightly.

Your description of life in Iceland is gross hyperbole, and suggesting the same for the UK is plain ridiculous, even in this world of failing banks and huge sharemarket losses.

Things can get a lot worse yet. We might feel a bit foolish about putting our money in Icesave now with the benefit of hindsight, but we were all taken in by the promised compensation scheme. That scheme was designed for individual banks going under, not a major collapse of the whole system. The depositor scheme will find it difficult to cover our first 20,000 euro losses, and if there is a major collapse in the UK the remainder of our funds are at risk too.

What about Iceland? They face a complete collapse of their banking system, with no access to personal bank funds, no petrol at the pumps and no pay cheque at the end of the month. Lets hope UK is not next. We seem to be relying entirely on 'consumer confidence' to avoid this scenario in the UK at present. Bland statements such as the government should guarantee all deposits miss the point - the money is just not in the system - and never was1

submariner - at least your Heritable savings are fully protected up to £50k by the FSCS as Heritable is a UK registered bank (which Icesave is not).

Hi fellow Ice Savers

My partner is very level headed. i'm a panicker. She says its too early to know what is going to happen. I think we've lost anything. My partner and I have £91,000 with icesave. Whilst this money is joint savings we only registered the account in my name so will probably only be covered up to £50,000.

I wonder what the position would be, if I added my partners name to the account before Icesave fall over?

Well desperate times demand desperate measures. For those in a similar position, you should know that you can print off an additional account holder form by logging into your icesave account. I'm posting mine tonight with the requisite ID and hope that if and when I have to claim to the FSA the account will be shown as joint one and covered up to £100,000.

I suspect there is a serious flaw in my proposal ........... but just a suggestion!

Well its looking increasing like we are going to have to finally see how effective the FCSC are. That makes me worry, just hope they have more nous than Gordon.

The Iceland website http://www.tryggingarsjodur.is/Frett/7806/

says: -

News

From the Prime Minister of Iceland

Written 10/7/2008 at1:34 PM

In a press conference today Iceland's Prime Minister, Mr. Geir H. Haarde, said that if needed the Icelandic Government will support the Depositors' and Investors' Guarantee Fund in raising the necessary funds, so that the Fund would be able to meet the minimum compensation limits in the event of a failure of an Icelandic bank.

The Icelandic banks have top up agreements in the following countries:

• United Kingdom
• The Netherlands
• Norway
• Finland
• Sweden

isioth wrote:

I confess I'm a little confused as to what happens to those with savings below the £16k guaranteed by the Icelandic compensation fund if it cannot pay, Iceland as a nation goes bust, the rest of Scandinavia fails to bail it out.

From what I'm reading, then those people lose all their money as the UK comp fund will only bail out those who have above 16k in savings up to a max of 50k ?

My reply: Exactly right. In that scenario, someone with up to £16k would get nothing back. Someone with say £50k would get £34k back. Someone with £100k would also only get £34k back.

Chineplate wrote:

I'm having trouble understanding how Landisbanki can be split into its various companies and then subsequently declare ICESAVE insolvent. Also, if Landisbank remains as a going concern, the Icelandic government must still be solvent and therefore able to pay compensation.

My reply: I agree. I don't know for sure, but it sounds to me that they are thinking of selling off the foreign operations as a going concern, which might mean that Icebank just continues with new owners (presumably bought by a different bank in a different nation). Then they end up with a nationalised domestic bank (what's left of Landsbanki), which will continue as it is now (after all it is still business as usual for Landsbanki's Iceland operations, even though it is in receivership).

redunderthebed wrote:

why would anyone invest in an Icelandic bank in the first place???

As a tax payer I don't want my hard earned revenue being squandered on greedy people who should have had more sense! As regards the banks, let these over-bloated financial monsters meet the end they deserve, and good riddance.

My reply: I think redunderthebed you are confusing an investor with a depositor. If we were shareholders in Landsbanki, then we have to suffer the loss of the bank since we invested in the bank by buying part of it. But we are not shareholders - we see no share of the profits of the bank - we are depositors. We trusted the bank with our money, for some interest payments, and they use our money for their own profit. We don't own the bank and are in no way responsible for its running and shouldn't have to care about its share price or debt exposure. I agree that a failing bank probably deserves to fail, and the shareholders will necessarily suffer in that case, but depositors should be protected.

sheethappens:

I feel redubderthebed has a lot to learn.

Firstly as a taxpayer, sadly you have no choice. This government runs the country as they feel fit, misguided, gutless and without a single decisive bone in a skeleton of political correctness and Quangos.

Secondly, yes they may be greedy monsters but we all need them for our day to day lives. They are more than banks they are our lifeblood. We use their cash machines, they pay our mortgage, they allow loans on our cars and help us to run our business.

We must look at the Icesave situation as a waiting game, difficult as it is. As the news flows stem,they change daily, hourly. At present there is a great deal of scaremongering out there. In my humble yet hopefully intelligent synopsis of this matter. The Icelandic government will not and cannot refuse to pay the full amounts out.An earlier poster noted correctly that they cannot just pay out the Icelandic people. Accounts are accounts at the end of the day, you cannot differentiate between nationalities in banking. They also cannot continue trading as a going concern and close Icesave UK/NL.

In this period of stress and uncertainty I am not alone in my situation. I had £101,000 invested up until Monday afternoon when I transferred £50,000 back to my UK account. On monday I managed to access it ok around 11.00am (Still awaiting clearance as others are) so I have £51,000 left in Icesave. Yes thats a lot, but whilst sad, agrieved and worried I think how lucky I am. There will be people out there with house deposits to pay, savings for school fees, tax bills, car loans, honeymoon/ travel bills, business savings etc As for me yes it was my life savings but we must all think positive in a time of crisis. Its a british trait to stand tall.Do this and tomorrow will come when the newsreader says " Icesave honours all accounts".

Good luck all, keep posting regular updates as and when we know.

Good post - a bit of positive thought might well reap dividends yet !!