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October 8, 2008

Treasury rescues Icesave depositors

by Gill Montia

Story link: Treasury rescues Icesave depositors

The Chancellor of the Exchequer, Alistair Darling, has promised support for the UK’s 300,000 savers with Icesave, the online subsidiary of Icelandic bank, Landsbanki, which was yesterday taken into state ownership and then placed in administration.

According to reports in the press, all Icesave retail deposits are now 100% guaranteed by the UK Government.

Further clarification from the Chancellor is awaited but the indications are that Britons with Icesave deposits will be reunited with 100% of their money, even if it is more than the £50,000 covered by the Financial Services Compensation Scheme.

The Chancellor has also confirmed that UK savers will not have to call upon the Icelandic authorities for any part of their compensation as all matters will be settled in the UK.

It is understood that the Government has frozen the UK assets of Landsbanki until the position of British savers is clarified.

In addition, the Treasury has arranged for around 22,000 people with deposits in Landsbanki subsidiary, Heritable bank, to transfer their accounts to Dutch bank, ING.

 

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