Landsbanki depositors: New blow
Tuesday 17th August 2010, 3:00PM BST.
Personal depositors in the UK and Netherlands, whose claims were backed by their governments, have been repaid in full
ISLANDERS still owed money in the wake of the collapse of an Icelandic bank nearly two years ago face further frustration after another attempt to recoup cash was blocked.
The Jersey residents invested their money in Guernsey-based Landsbanki, which collapsed in October 2008. About 100 Jersey residents who held accounts are understood to still be owed about £1.8 million.
They have been repaid 67.5 per cent of their money in chunks, with the last payment made in February this year. It is expected that they will eventually get over 90 per cent back, but it could take years.
About 600 Channel Islanders and 1,600 people in total around the world are still owed money, but the chances of their getting all their savings back were dealt a blow last week when the Icelandic winding up board rejected a claim made on behalf of 202 individual depositors in Landsbanki Guernsey.
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Why hasn’t the Jersey Government pressed its Guernsey counterpart to do more to ensure that depositors are repaid in full?
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No 1. – Not sure what you mean by ‘pressed’. What do you expect the Jersey government to do?
I think the depositors are pretty fortunate to get two thirds of their deposits back already.
People have to take some responsibility for the decisions they make and placing money in a small Icelandic bank in an offshore jurisdiction which did not have a depositor protection scheme was a risky deposit (which was why it paid above market interest rates).
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Dave, that comes across as pretty smug. Landsbanki was allowed to trade by the Guernsey Financial Services Commission which obviously lent it credibility. Landsbanki held deposits from many large institutions and local government departments, all of which had access to better information than the average private investor. Nobody expected the worst to happen, at the time it was virtually unthinkable. I lost nothing in Landsbanki but only through good fortune. I had my money with Royal Bank of Scotland only to find out after the event that they too had come very close to collapse. ‘Let the buyer beware’ is a fair enough maxim, but not when the GFSC was supposedly there to protect the public.
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Cant really blame the GFSC for not foreseeing the collapse, after all one of the biggest investment banks in the world, Lehman Bros, folded during this time and no one would have thought that. I think its important to remember the small print “your investment can go down as well as up”. To eventually get 90% back is good, remember those people who lost EVERYTHING when Enron collapsed. Be grateful.
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That’s not very Sensible – “your investment can go down as well as up” applies to investments NOT to savings accounts with regulated, licensed and ‘local’ banks.
Be honest, you smug blighters, before Landsbanki had you ever heard of ‘upstreaming’? Since customers did not know it was happening don’t you think the GFSC should have thought twice before effectively endorsing Landsbanki or at least doing something to help when it all went sour?
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Any Jersey investors or should i say rate tarts deserved to lose their money. They placed money with an institution that did not meet the licensing criteria of the JFSC.
They were willing to accept a higher rate of return but apparently did not want to accept the risk they were taking.
Greedy people who now expect to be baled out !
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No 3.
‘‘Let the buyer beware’ is a fair enough maxim, but not when the GFSC was supposedly there to protect the public.’
What do you mean by this statement? Are you suggesting that the GFSC (ultimately the Guernsey taxpayer) has some sort of obligation to compensate the depositors?
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3. your spot on if it wasn’t for the British Government backing RBS Jersey would probably be finished. Its amazing that the JFSC allowed upstreaming of the deposits held offshore to a parent company that they either they didn’t know was failing (if not why not?) or allowed local directors to make decisions that could have affected the viability of the entire ecomony when the directors knew RBS Group was on the brink.
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What do people expect!!
Why do you think they were paying 6% for a deposit??!!
To be quite honest, you are luck to get anything back.
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Peter, what a nice fellow you are. 100 of your fellow islanders have been robbed after putting their savings in a Guernsey based GFSC licensed bank. The money was then spirited away to its parent bank in Iceland and all you can say is they “deserved to lose their money”. I would say that you deserve the same thing to happen to you but the truth is probably that you have no savings and are just sick with jealousy of those who do.
If you do have some money somewhere, why not tell us all how you carefully researched your bank, its complete corporate structure and balance sheet, license etc. You know you didn’t – you relied on the JFSC or GFSC which is the same as these unfortunate people did.
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Same goes to all you mean spirited people who seem so glad that your neighbours have lost their savings by entrusting them to a GFSC licensed bank. Instead of just gloating, tell us about all the steps you have been through to ensure that your bank will give you back your money. Every time I see another smug comment I just think you have no understanding of what has happened here, probably because you’ve never had any savings anyway.
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I didn’t have any money in Landsbanki, I thought I was playing safe by keeping mine here:
“RBS wasn’t just the U.K.’s worst bank, they were the world’s worst bank,” said Ralph Silva, a strategist at London- based Silva Research Network. RBS needed 45.5 billion pounds of taxpayer-supplied capital during 2008 and 2009, in the world’s biggest bank bailout.
RBS International was, of course, licensed by the GFSC just like Landsbanki.
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No8. RBS Jersey is a 100% subsiduary of RBS PLC therefore would benefit from any bouyancy granted to it’s PLC parent, why would that even be in question?
No1. & No3. The Jersey Government has as little to do with its Guernsey counterpart ‘doing more’ as the Jersey Government asking the Guernsey Prison to release someone early because someone in Jersey is sad about it! Nothing!
Now the JFSC has assisted the GFSC in every way it can bar giving them actual money but lets remember that Guernsey had NO depositors compensation scheme in place at the time. It is pointless saying that because we had never expected the worse to happen we decided to place our monies in a teritory which is outside of Jersey, I don’t believe that ignorance is a plausable excuse to be bailed out by the Jersey tax payer!
Well over 300 banks have failed since 2001 and even before that we have seen institutions fall due to one circumstance or another, lets reflect on Barings!
Jersey has always been very specific, only allowing the top 500 financial institutions to operate in Jersey and even then while licences are not granted to banks that are not in the top 500 by size, the fact that a bank is in the top 500 is still no guarantee that it would receive a banking licence in Jersey. This at times harsh policy, has protected Jersey investors from the likes of
Landsbanki, if you pay attention to policys that is and dont send your money elsewhere.
On the final note of ‘upstreaming’ which is the most ridiculas misuse of terminology I have the annoyance of coming across these days. This is the phrase attached to passing funds to your parent company in order to manage your daily positions, something which the Bank of England will fine you massively should you fail to do it. Every, yes EVERY bank in the world will on a daily basis either borrow funds or lend funds in order to manage their positions. Now because the use of brokers is deemed a cost that can be done without these days local interbank dealing has declined massively so therefore funds are “upstreamed” (or) in real terms lent to the parent company for them to then manage and place on their balance books to then either be lent or for them to borrow funds from another financial institution in order to get their balance neutral, it CANNOT be avoided fullstop! In the same way that should multiple large withdrawals be made from an institution by regulation they would need to borrow funds in order to give them a neutral position at the end of the day, or by this new terminology I guess this is “downstreaming” or maybe “backstreaming”. haha
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13. Your forgetting this is an Offshore Jurisdiction and RBS is a company which owns the shares of RBSI. If RBSI (or any other offshore company) doesn’t have a board with directors etc its tax position with UK plc would be broken. Ownership doesn’t infer any guarantees of the parent or in this case the British government (which RBS didn’t have, its just the UK gov had no choice). My point was the JSFC allowed a Jersey Offshore company to lend a deeply troubled parent billions, which had it not been repaid would have quite probably destroyed the island.
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To those of you that are saying we were investors get you facts right please we were depositors the same as I deposited money in HSBC I did not invest my money so I didnt have to read the small print that says investments can go up or down And yes the Guernsey states should do more to help like other goverments have and 6% rate was the same as a lot of other banks and building societies were offering at the time we were not being greedy just putting our money where we expected it to be safe
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