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Deposit guarantee at UK banks reduced to £75,000

bankofenglandMoney in British bank deposit accounts will be guaranteed only up to a maximum of £75,000 with effect from 1 January 2016.

The announcement was made by the Bank of England and results from EU regulations which fix €100,000 as the guarantee limit. When in 2010 that level was agreed, it equalled £85,000.

Now that the euro has dipped against sterling, the guarantee is slipping to £75,000.

It was the Northern Rock panic which helped introduce greater savings protection. Before then, just £2,000 was guaranteed fully with 90% cover for the next £30,000. The government introduced a complete guarantee on deposits up to £35,000 when panic set in in order to avoid a run on Northern Rock.

The guarantee went up to £50,000 in 2008 and to £85,000 in 2010.

"HM Treasury has today put in place legislation to maintain the existing limit of £85,000 until 31 December 2015 for depositors who were previously protected by the FSCS and continue to be protected (including individuals and small companies)," the Bank of England's Prudential Regulation Authority said.

"This transitional measure helps to ensure that depositors have suitable time to plan for and adjust to the change and will protect most depositors from experiencing a sudden change in the amount of compensation available in the event of the failure of a bank, building society or credit union."

Savers with more than £75,000 in one bank would be wise to spread the risk among several banks, although people who come into a large amount of money are given six months full protection for up to £1 million.

"Depositors with temporary high balances will be covered up to £1m for six months from the date on which the money is transferred into their account, or the date on which the depositor becomes entitled to the amount, whichever is later," the Bank of England said.

"This is to ensure that depositors are protected when they deposit funds over the limit as a result of specified events, including following a house sale or funds received from a ‘life event’ such as a divorce settlement or inheritance, for a period of time until they have had sufficient time to spread the risk between institutions to appropriately protect these funds."

An ‘institution’ is the authorised entity. Some banks and building societies have more than one high street brand under one authorised entity. Thus, if an individual has £75,000 in more than one brand within a single authorised entity, they will still only receive a maximum of £75,000 even if both went bust.

For example, among the building societies: Yorkshire Building Society also operates the N&P, Chelsea and Barnsley trading names. National Counties Building Society also has the Family Building Society trading name.

You can see a full list of banking and building society brands and which authorised firm owns them on the Prudential Regulation Authority website.

For a list of 'who owns whom' on Excel, click


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-1 #5 Denzil 2015-07-04 13:10
Keep reminding yourselves this is a UK banking and is only an adjustment because of the strength of sterling.

But a fundamentally serious threat to the eurozone is giving in to Greek demands for debt haircuts. Because, having thrown away say 200 billion for the Greeks, just days later will come Portugal wanting a similar amount wiped off their debt. Dream on !!! No way.

The other Cameron ... that PM of the UK sensibly suggested that Greece would be better off with a period outside the euro.

To get its economy back. As always those would be Bonaparte's in France rubbished this as they want to recreate a pan European currency just as the original Napoleon intended in the early 1800's. Having over run Portugal and frenchified it before the Brits cleared them out.

But in Bild Germany's FM Schaeuble is also suggesting this !!! Maybe Portugal should start reprinting contas ? Or perhaps it already is ....
-1 #4 The prince 2015-07-04 11:42
This claims are worthless!

They will rob all of your money from bank accounts!

Its just be done in cyprus in 2013, the eu engineered the robbery of all cyprus citizens savings from there bank accts, they called called it a "haircut"

Do NOT KEEP your money in banks, especially in the eu.
All europe and usa banks are already insolvent, they are just printing and printing money.

Soon its all going to implode, if you use bank, only keep tiny amount in cash to pay bills, and food money,
Convert your money into gold, silver, antiques, art, premium property, bitcoin etc.

Watch the free documentary now! Find it on google youtube.

Zeitgeist addendum
+3 #3 David Cameron 2015-07-03 22:23
Quoting Chip the Duck:
Once again the EU rule our lives. We now lose protection because their Eurozone is unable to manage its finances.


The EU position - €100,000 - hasn't changed: this is a Bank of England decision.

And do remember, when EU decisions are made, UK officials are at the negotiating table agreeing to the final decision.
0 #2 RCK 2015-07-03 20:46
There will be people out there who have invested £85000 in the recent past, in good faith, in long term bonds, of up to 7 years in some cases, who now cannot legally access their funds until the end of the term and are therefore left at risk on part of their investment with effect from January 2016 through no fault of their own.
How can this be fair or right?
The Government & Bank of England need a rethink on this one. Talk about moving the goalposts
-2 #1 Chip the Duck 2015-07-03 18:06
Once again the EU rule our lives. We now lose protection because their Eurozone is unable to manage its finances.

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