Rainy day fund to ‘backstop’ savings
Tuesday 7th October 2008, 2:59PM BST.
THE £600 million rainy day fund will be used ‘as the backstop’ to repay Island savers if banks go bust, the Chief Minister announced this morning as bank shares plummeted.
He said that the strategic reserve would be used to bail out banks if all other measures failed. Senator Frank Walker announced the details of the deposit protection scheme this morning and insisted that such a worst-case scenario was very unlikely in Jersey.
He said that the announcement should steady the nerves of savers across Europe who were today looking for reassurance as the international banking crisis deepened further. The value of shares in RBS lost around 40 per cent of their value today, while those in other banks including HBOS also fell considerably.
Senator Walker said that before the rainy day fund was dipped into, the Island could be forced to borrow and make the banks repay the loans. It is not clear at this point whether the money would be available on the world money markets or how a bank that had gone down would meet such obligations.
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This is disgusting. The ‘rainy day fund’ is supposed to be for the benefit of ALL islanders, it is after all being funded by our taxes. Why should those who can actually afford to save money get the benefit from it? Those of us who cannot afford to save anything get ignored by Mr Walker AS USUAL. The way the States protect the wealthy and ignore the less fortunate on this island makes me sick.
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Good old Frank. It will be a shame to see him resign in a few weeks time. The bloke is a genius. He will be missed by many.
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I’ll believe it when i see it in writing, checking the small print as a matter of course. You can not trust bankers or politicians these days.
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An absolutely brilliant move
A crisis in the finance industry could wipe out the rainy day fund as well.
If that happens you won’t be able to get out on the first boat in the morning, it will be packed!
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I dont think that is going to cover it Mr Walker!
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Nice one. Selling the family silver to bail out the banks who have made such a huge mess of the present economic situation and goodness what damage to our future prospects. Now we are going to throw good money after bad – what sort of management policy is that?
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Does the ‘Chief Minister’ (ha!) know the value of the deposits we are propping up? There’s probably a few of his cronies who have that much between them in local accounts. And why should Jersey banks be any safer than the European and American giants that are failing now?
Note to Walker & co: Those banks are in the top 500; the ones you believe are safe! Sigh. Wish I’d bought shares in Ostriches and sand.
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and this is the industry that we have our whole future based on? What a ship of fools.
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I doubt very much if 600 million would even start to cover the deposits of all jersey residents.
A lot more people are shifting their cash than has been disclosed. Watch this space.
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Just island savers? can i get my mum and extended family from outside the island to transfer their cash to me then to protect it all? is there a date or is this offer ongoing?
lacking in detail or just a throw away comment? cant wait to see the details. they will be forthcoming wont they? this was a promise from the chief minister which is on record after all.
frank, this may well be called upon. have you really thought this through?
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“insisted that such a worst-case scenario was very unlikely in Jersey.”
More clearly dilusional speaking, what makes Jersey think that its the only place imunne from the GLOBAL financial crisis? A whole economy based on the finance industry makes Jersey even more vunerable.
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and where is this £600m held? US/UK govt bonds? tell us that frank. its our money.
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I gather that Iceland now has a direct line to Putin so perhaps we should start making the calls?
Ironically Iceland has (had) the same reliance of financial services, and they are facing country bankruptcy and it apparently only took 4 days to change….
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Is this a depositor protection scheme or not? Is my money now safe? I can’t wwork it out. Badbob is right – we need to see the small print.
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So basically the tax payer will be giving themselves their deposits money back, out of their own money THEY already paid to tax.
So the public loose out twice because a private company got greedy
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Please vote the Walkerites OUT. Ozouf, Vibert, McLean, Routier, Troy and Ferguson.
They are, yet again, putting the rich first. This time with YOUR rainy day fund!
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Our ministers have been sitting on an Investment Protection Scheme that was drafted in 2002 which would have forced all the banks operating in Jersey to guarantee each other’s debts. They now claim that this scheme could not possibly work. If that is the case then why didn’t they come up with something better in 2002 instead of running arounf like headless chickens now and endangering public funds? This is the “experienced” government that apathy and complacency elected 6 years ago – this time make sure you get it right – this is not the kind of experience Jersey needs.
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Why can’t we have the details of this ‘scheme’ – it must have been available to all States members when it was discussed last Monday?
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Well i have been contributing to the rainy day fund since it was started but i have decided i want my bit out now because i need it to go on a holiday in the sun, but wait i have had second thoughts i think i would rather give it away to someone who through their own greed who invested in a bank giving unbelivable interest returns. And who else should i give my rainy day fund bit to oh yes i forgot to someone who may have may hidden his/ her money in a Jersey bank not declaring the interest earned but the states want to give them a full refund . But perhaps the experts who have invested our rainy day fund have also put them in shares that are now worthless. i suppose i will forget the holiday as i will be paying more tax in future to pay for the incompetence of the so called banking experts the states employ
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