How Safe Are Manx Banks

[Lee54]

FAO Stu Peters.

Stu, can you give me the link to your program of yesterday ref Interview with Mr Allan Bell. thanks.

[hboy]

These days the 'Bank Of Under The Mattress' is the safest one around - something to sleep on whilst you ponder the security of the others....

 

The ironic thing is that due to anti money laundering laws your bank won't allow you to withdraw massive amounts of cash to store it under your mattress because you might be funding criminal activity and they will have to do a suspicious transaction report on you, plus try paying large amounts of cash back in at a later date once the panic has subsided. Your bank will treat you like a cross between Gary Glitter and Al Capone.

[Lee54]

It you do spread you savings around other Banks and a Bank goes bust, any connection between the banks you have your money in, it will be treated as just one account

 

Just watching the news and the headline is AIG could be the next to go and HBOS value has gone down 40% in the past 2 days, its also said the the full extent of what Lehman Brothers owe the UK banks is uncertain, one bank alone is reported to be owed over £1.5 billion by Lehman.

 

http://www.itv.com/News/Articles/Lehman-sh...-956273037.html

[Sebrof]

It you do spread you savings around other Banks and a Bank goes bust, any connection between the banks you have your money in, it will be treated as just one account

 

Please re-word this to make it intelligible. If you mean what I suspect you might be trying to say, you are not necessarily correct.

 

Just watching the news and the headline is AIG could be the next to go and HBOS value has gone down 40% in the past 2 days, its also said the the full extent of what Lehman Brothers owe the UK banks is uncertain, one bank alone is reported to be owed over £1.5 billion by Lehman.

 

Lehman has gone into administration to enable it to realise its assets in an orderly manner (or even to continue to trade). In addition to having debts of X, it also has assets of Y, and the loss to creditors will be the higher of zero and X-Y; not just X as you are suggesting.

 

I can remember when Rolls-Royce went bust back in 1968 or thereabouts, thanks to a fixed-price contract with Lockheed. It transpired ultimately that Y was greater than X, so not only were all creditors repaid in full, but shareholders got something back too.

 

There has been a huge amount of highly misleading reporting on the credit crunch, by people who should know better. Sample: "Britain exposed to £100 billion loss on Northern Rock (DT)". No, actually; NR's total liabilities may be £100 billion (or whatever), but they also have assets of much the same amount, so depending on where and when the housing market bottoms out, the eventual loss could be quite small, or even negative.

 

The last thing we should be doing at the moment is fomenting panic through ignorant rumour-mongering.

 

S

[gazza]

Just watching the news and the headline is AIG could be the next to go days, its

 

http://www.itv.com/News/Articles/Lehman-sh...-956273037.html

 

does this mean i wont have to pay the finance back for the item i have

[Lee54]

Please re-word this to make it intelligible. If you mean what I suspect you might be trying to say, you are not necessarily correct.

 

 

 

OK,, you have deposit accounts at the IOM Bank, Nat West and the RBS, RBS goes bust taking its other Banks with it, you only get copensation on one of the accounts,

[thesultanofsheight]

It you do spread you savings around other Banks and a Bank goes bust, any connection between the banks you have your money in, it will be treated as just one account

 

Please re-word this to make it intelligible. If you mean what I suspect you might be trying to say, you are not necessarily correct.

 

No he is correct. If you have IOM deposit's with the RBS Group (IOM Bank, Natwest, RBSI) your only covered once not for each subsidiary. So if you hold £50k with RBSI, £50k with Natwest and £50k with the IOM Bank - your maximum compensation is £15k because they all have the same parent.

 

Lehman has gone into administration to enable it to realise its assets in an orderly manner (or even to continue to trade).

 

Lehman are dead in the water. Chapter 11 is likely irrelevant in these circumstances. It might take time for them to realise that they can't meet their liabilities. But that is what will happen.

[Gladys]

Rumours abound on another financial forum that RBS are in the worst position at the moment and are going to europe for funding !

 

http://www.housepricecrash.co.uk/forum/ind...=67685&st=0

Last post in that thread was in Feb. Stop scaremongering!

[Sebrof]

It you do spread you savings around other Banks and a Bank goes bust, any connection between the banks you have your money in, it will be treated as just one account

 

Please re-word this to make it intelligible. If you mean what I suspect you might be trying to say, you are not necessarily correct.

 

No he is correct. If you have IOM deposit's with the RBS Group (IOM Bank, Natwest, RBSI) your only covered once not for each subsidiary. So if you hold £50k with RBSI, £50k with Natwest and £50k with the IOM Bank - your maximum compensation is £15k because they all have the same parent.

 

I now understand.

 

Lehman has gone into administration to enable it to realise its assets in an orderly manner (or even to continue to trade).

 

Lehman are dead in the water. Chapter 11 is likely irrelevant in these circumstances. It might take time for them to realise that they can't meet their liabilities. But that is what will happen.

 

The parent company is in adminstration to allow the rest to be dealt with as appropriate, and obviously it is therefore "dead in the water". But that does not mean that the assets all evaporate, nor that some parts of the empire might not be taken over as going concerns. It is too early to say.

 

But one thing is true, and that is that the headline total debt is a very different thing from net debt.

 

S

[Dunroamin]

Have read the FSA blurb and the way compensation seems to operate in the IOM is that you only get the maximum of £15,000 per total of depsotits in any number of accounts in one bank or those connected to it, less any loans from those institutions, (being up to 75% of a maximum £20,000 net deposit) repaid if and when the IOM Government recovers sufficient money by way of levies on the remaining banks!

 

This is in fact pretty worthless in these circumstances as if one of the major banks in the UK or Ireland( of which all Manx Banks are subsidiaries (bar Conister)) the rest will almost certainly be so badly hit by losses on inter bank loans as to be unviable themselves.

 

In the UK, the UK GOVERNMENT meets the liability of £35,000 per £35,000 net deposit and is soon to increase this guarantee to £50,000.

 

Would suggest that we move our accounts from the IOM to UK. Now there would be a business for someone in arranging all the certified passports and utility bills required for such an occurrence!

[pongo]

Have read the FSA blurb and the way compensation seems to operate in the IOM is that you only get the maximum of £15,000 per total of depsotits in any number of accounts in one bank or those connected to it, less any loans from those institutions, (being up to 75% of a maximum £20,000 net deposit) repaid if and when the IOM Government recovers sufficient money by way of levies on the remaining banks!

 

This is in fact pretty worthless in these circumstances as if one of the major banks in the UK or Ireland( of which all Manx Banks are subsidiaries (bar Conister)) the rest will almost certainly be so badly hit by losses on inter bank loans as to be unviable themselves.

 

In the UK, the UK GOVERNMENT meets the liability of £35,000 per £35,000 net deposit and is soon to increase this guarantee to £50,000.

 

Would suggest that we move our accounts from the IOM to UK. Now there would be a business for someone in arranging all the certified passports and utility bills required for such an occurrence!

 

If you invest in National Savings & Investments in the UK then your savings are guaranteed 100% to the full amount by the UK Treasury. The downside of this is that you will get a lousy rate of interest such that your savings will be eaten by inflation. You will also need to submit a UK tax return.

 

There is no equivalent savings vehicle available locally AFAIK.

[Lee54]

FAO Stu Peters.

Stu, can you give me the link to your program of yesterday ref Interview with Mr Allan Bell. thanks.

 

Thanks Stu. Found it very intersting.

 

http://www.manxradio.com/audiovault/HeadsMON-1.wma

 

HBOD Lloyds latest

 

http://www.youtube.com/watch?v=JIxWRQY2xyo