Thursday, 30 September 2010
Irish rug pulling
Headlines about the Irish government's billion-euro bail out of Anglo Irish Bank will leave hundreds of thousands of British investors and savers fearful for the security of their money.
The Irish government first stepped in to ensure Anglo Irish Bank's solvency through nationalisation last year, with Allied Irish Bank and the Bank of Ireland also recapitalised in February of that year to the tune of €3.5bn each.
The Irish government has long claimed that customers with savings in all of Ireland's major banks are safe. It extended a 100% deposit guarantee to all Irish-owned financial institutions in 2008 until 29 September 2010, and this has recently been extended to the end of the year. But panicked savers have continued to withdraw their cash – in the first half of this year customer deposits fell by more than €5bn to €23.1bn.
Andrew Hagger of Moneynet.co.uk says: "Savers who have fixed-rate bonds with Anglo Irish Bank or other Irish banking groups will just have to wait for them to expire. When they do, especially if this is after 31 December when the 100% government protection is scheduled to end – and especially if they have savings worth more than €100,000 in any one group – customers might want to spread their cash around to be safe. No one is saying the banks will go under, but then no one thought Icesave would go bust." more
Last year small savers piled into Irish banks because of the government protection... now it looks like its time to move again.
Posted by BOSALAND at 07:33