Jenny Booth
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Gordon Brown today vowed to protect British savers who face losing money in the Icesave online bank which collapsed yesterday, and threatened legal action against the Icelandic authorities to force it to honour its obligations.
Icesave, the online British arm of Iceland’s second biggest bank Landsbanki, announced yesterday that its customers could no longer withdraw or deposit money, as Landsbanki was taken into receivership.
“The Icelandic government have told me, believe it or not, they have no intention of honouring their obligations there,” Alistair Darling, the Chancellor, told BBC radio.
But citing “exceptional circumstances” he said: “We have decided we will stand behind those savers."
Mr Brown later told a Number 10 news conference that Britain stood ready to sue Iceland to honour its responsibilities. “We are showing by our action that we stand by people who save, he said.
More than 300,000 British customers had around £4 billion deposited in Icesave accounts, which until yesterday offered higher rates of interest than British banks.
The UK government last week issued a general guarantee that British account holders will be able to reclaim their money if their financial institution goes bankrupt - but only up to a maximum of £50,000 each.
One saver, Peter Amodio, has told The Times that he had £180,000 on deposit with Icesave. Another saver had her £200,000 life savings deposited with the online bank. It was not clear today whether Mr Darling and Mr Brown intended to ensure that such savers got all their money back.
Actually reclaiming the money may prove a struggle for Icesave customers, moreover, because Icesave was one of a handful of banks to claim the so-called passport exemption - meaning that savers must apply to the Icelandic authorities for the first 20,887 euros (£16,170 pounds) they have lost, with the British compensation scheme topping up the rest up to the £50,000 maximum.
Mr Darling made plain today that he would pursue the Icelandic authorities, if necessary through the courts, to help savers get their cash.
“We are pursuing Iceland and we will pursue it vigorously to make sure that we get the money due to us back,” the Chancellor told GMTV television.
“But in the meantime I am going to be able to help those savers who would otherwise have to look to Iceland to get their money back. I am prepared to stand behind them and to stand behind the depositors.
“It demonstrates my commitment to help people who have put money into banks in these exceptional circumstances."
The online bank’s website remained frozen today.
“We are not currently processing any deposits or any withdrawal requests through our Icesave internet accounts. We apologise for any inconvenience this may cause our customers,” read a message on the site. “We hope to provide you with more information shortly."
Icesave customers have vented their fury online as the tried to rescue their savings.
Steve, 48, a textile management agent from Derby, central England, said: “My wife and I need to pay up to £12,000 for renovations on our bungalow next week and I have no idea if we’ll be able to access our money to do so.
“I’ve been panicking this morning and I can’t concentrate on my work. I’m worried we’ll lose all the money if the Icelandic government doesn’t have enough in its coffers to guarantee everyone’s savings."
Justin Smith, a West London IT consultant, said: “I feel confused and badly informed by Icesave -- there has been no direct communication from the firm and now I am unable to withdraw my life savings, with no idea on what happens from here."
The six safest places for your savings
I understand that Ice save will start paying back money in the next few days. I am still unclear as to whether I will get a pro rata interest payment or should I assume bye bye to that?
jennie bradford, london, uk
It is bad when people lose their savings. The regulations regarding this in Europe stipulate that around 16500 pounds are secured. From that we can derive that all will receive that sum. The Landsbanki assets are believed to be almost equal to its debt. Guess who will claim the applause? Mr. Brown.
Hinrik, Reykjavik, Iceland
AK, Nobody lost any money deposited with Northern Rock. The two cases cannot ne compared
Garryq, sunderland , UK
BIG financial problems all over the world, the government are already using tax money to support banks (to protect us) how much would it cost to refund all savers of this? and then refund those who lost out last year with Nothern Rock?
AK, Pig Hill ,
I put my savings on a horse that was bound to win. It didn't! Will the Goverment please give me my money back?
Simon Jester, Laxanada, Greece
You took the risk to get the higher rate, now you pay the price for that higher rate, stop complaining.
Ian, Ramsgate, UK
the icelandic banks were not Icelanders property ... we have not gotten any money from your accounts,the companys in uk you call Icelandic are not making any money fore the nation,not paying taxes in iceland or transfering money to iceland. how can I be responseble fore your accounts
jon, reykjavik,
So its ok to use anti-terror legislation in order to seize the assets of a peaceful nation? This is a very slippery slope that we are going down and the really funny thing is that because of the desperate greed of man not one person here has mentioned it.
So this is England.
anthony, London,
Does this mean we'll be able to sue Gordon Brown to get back the money we've lost on our pensions?
Dave, Ilford, UK
To the British,
Will there ever come a point in time where you'll hold yourself and your government accountable for problems in your country.
Jay , Taipei , Taiwan
I can offer greedy investors & imprudent local authorities far better interest rates than Icesave! What sort of idiots believe banks have expertise in managing money? I have " Arthur Daley's Guide To doing It Right" in front of me, obviously essential Bankers Reading! Mug with dignity!
Tom Green, Wigan, Lancashire
The new emergency laws in Iceland also gives depositors priority claim if a financial institution goes under. So it's very probable that Landsbanki has enough assets to cover IceSave.
It's very convenient for Brown to have someone to blame now, but he can't just ignore the icelandic PM statements.
Rafn Steingrímsson, Kópavogur, Iceland
i must say that i am not affected by the turbulance in the finanacial market but the way British government is handling icelandic is an admirable way and makes me to invest my money in Britsh Banks from now on.
mir
mir alex hosseini, Manchester, UK
Icesave is a UK bank....
mark walker, Bristol, UK
Is it Ironic that I chose this account based on the "easy access, penalty free" element?
Mark, Milton Keynes, Bucks
I knew that Icesave had a different compensation system but I did NOT KNOW that the Icelandic government would not stand by that system!! If I had been aware of that, I would NEVER have deposited my life savings with them no matther HOW GOOD the rates were.
The Icelandic government is A DISGRACE!
JANINE BYRNE, BIRMINGHAM,
Hope the UK government give the same guarantee for savers with other banks, especially those of us who kept our money inshore.
Ron, Milton Keynes, UK
'rate tarts' will no doubt have their money in HSBC (Hong Kong and Shanghai....)
steve, stevenage, uk
Steve, HSBC is a British Bank!!!
Ricky, London,
This is scandalous!
All Icesave investors knew
a) you get a higher rate of return only because of higher risk
b) only £50k was covered
c) like any investor should, they'd have known that there have been warnings about Icesave for months
Now my earnings pay for their bad investments?!!!!!
Helen E., London, UK
It is ridiculous to say that Icesave depositors were aware of the risks simply because the interest rate was good. Credit ratings agencies considered the business to be low risk. These are cash deposits, NOT investments in the banks themselves.I'm not affected, but am glad deposits are protected.
Frank Hegarty, Farnborough, UK
Does anyone save with the Post Office? Their investments are handled by a foreign bank - the Bank of Ireland! What if Ireland goes bust and their government renege on their obligations, like the crooks in Iceland?
P.S. HSBC is British - founded by a Scot with its HQ in Canary Wharf.
John, Bromley, Kent,
1 Shame bankers to commit to refunding 90% of their bonuses of the past 10 years
2 Disband the FSA. It is a failed institution.
3 Discontinue MPs expense perks.
With the proceeds:
4 Compensate Equitable Life victims in full plus interest
5 Finance youth clubs,not prisons, & care for elder
Susan, London, UK
To leave your money a high savings account of any kind, is the investor's decision. It is therefore the investor's responsiblity to ensure that their money is in safe hands.
IceSave has been a liability for over a year now. This is why I moved my money from IceSave last year.
Alice Naylor, Reykjavik, Iceland
Who said that the Icelandic gov was not going to honour its commitment the UK gov ha.
For god sake give them a change to get thinks into perspective they have more thinks to consider then just UK Ice savers ex. not go bankrupt.
By the way the UK gov is making a great political capital out of this and what is £ 4.5b to them, when they seem to find £400b at a drop of a hat.
Ginni, London, UK
"Mr Brown later told a Number 10 news conference that Britain stood ready to sue Iceland to honour its responsibilities."
Where? The small claims court? Iceland won't pay because £4bn is half its GDP. That would be crazy.
Oh...whats this about Darling and £600bn...
Anthony Lester, Brum,
Well well.
Gordon Brown and our prime minister Geir Haarde have reached an agreement to explore options to pay back those who had Icesave accounts. Landsbanki assets are considerable and strong. Now they will try to sell them to fulfill their duty's towards the British deposit owners.
Skarphéðinn, Reykjavik, Iceland
1. There are very few accounts in Icesave over 50,000 which is why Mr Darling has accepted them.
2. Most people only inteded to try and keep pace with inflation not "get rich"
3. The fault was the FSA who did not regulate this bank properly and the media who promoted it without sufficient warning.
Mike, London,
I am from Iceland and I have been happely living on your IceSave for a while. Now after the bankrupt of the banks. Iceland has no debts and we can again start to buy up british company maybe with british money?
Agust, Reykjavik, Iceland
If borrowers from the banks are defaulting, then the banks will be unable to to pay their depositors.The Government could obtain repayment from the borrowers through the PAYE system (like student loans). Any inflationary shortfall will raise security prices, thus solving the problem without taxes.
Peter L. Griffiths, London, UK
1. Saving with a bank, eg interest current account or an ISA *is* an investment. I do wish you'd stop protesting that it isn't. You made an investment decision.
2. It is your duty to constantly monitor any firm you invest with.
3. Icesave warnings were in public domain in April.
Responsibility.
Laura Roberts, London, UK
This "bailout" of savers is ludicrous and unfair.
They made their deposits because of the interest rate offered.
The rate of interest is a reflection of the risk of the "investment".
They took their interest and their risk.
Why should the tax-payer bail them out?
Black mark HMG.
Alan Hargreaves, Holywell, UK
A man tells me he could make my savings grow. I keep aware of the world, I know he lives in a country whose government has got into money trouble. I decline and save with someone else, for lower return.
My neighbour gives him all his savings; leaves him to it.
Why should I pay for my neighbour?
Maria, London, UK
So are UK savers with money in Abbey and Alliance & Leicester (owned by Spanish giant Santander) 'rate tarts' too? And presumably should be saving with 'British' banks instead? As a reminder, these were sterling accounts linked to the Bank of England's base rate, not risky offshore accounts.
Karl, Wirral, UK
So Mr Darling is off to the courts to get saver's money from the Icelandic government. Two words spring to mind here, Blood and Stone. Besides. if push comes to shove, will we be sending the baliffs in to sieze some of the country's (potentially Russian owned) assests? Good luck Mr D.
Steve, Burnley, Lancs
At the end of day, the UK government allowed these banks to operate in the uk, and act like any other uk bank. it is only fair the government support these savers. also most of the excess of £50k savers were tied in to 6 month deals, meaning they could not take any money out.
john, london, uk
before you start complaining about ppl putting their money in icesave a foreign bank, ensure you know the facts. It was the UK government which gave them a license to operate in the UK so they should be obliged to help.
kulvinder, Barking, UK
Since when have UK savers been labelled unpatriotic simply because they save in a foreign owned bank, I hope that Rahul, Terry and Phil only drive British cars, eat British food and buy only British products. The government is in the business of preventing panic, bank runs kill banks quickest of all
Jason, Aberdeen, UK
"Rate tarts", "stumbled across on the internet" good informed comments there from Mac & Rahul. Icesave was an award winning company in June '08 and recommended. What is shocking is that despite having a system that guarantees savings, the Icelandic government are now washing their hands of it.
Matt, London,
Why do people say that Ice Save customers shouldn't be paid out by our Government? No doubt your comments would be very different if it was your money (DH's). I appreciate that the government did not have to do this, but for once it shows the morales behind the Prime Minister and Chancellor are good
Paul, Gillingham, England
Rahul, London.
I'm by no means a "rate tart". I chose to transfer my small ISA to Icesave because although the Natwest offered a similar rate , the Icesave application could be done online rather than requiring a visit to a branch. Having limited mobility was a major factor in my decision.
Alphonso Grenardi, Gloucester, UK
"In which court?"
Presumably a UK court.
If judgement were given against Iceland presumably assets could be seized to the value owing.
Sam, Exeter,
Agreed those who were saving in these account were rate tarts.
When these accounts first became popular the benefits and risks were covered at great length, particularly that savers were not covered by UK banking laws. What have these eagle eyed saves been reading recently?
Adam, Hertford,
Icesave did business onshore in the UK, just like ING Direct. I deposited (not invested!) in an onshore UK business. To Rahul, I am sorry that I did not have the foresight to take my bank details on my honeymoon so that instead of worrying, I could have pulled my money out in time.
Miriam, London,
Before the critics get too comfortable on the moral high ground, they should note that traditional British banks are no longer what they were - Abbey is owned by Banco Santander and what were building societies (Bradford & Bingley, Northern Rock) have all been burned in global markets. Who is safe?
BENITA EDWARDS, London, UK
Full marks to Darling in aiming to protect saver deposits. Bank deposits are the bedrock of the system and have to be a nil-risk investment otherwise the system could not function. Some people seem to confuse bank deposits with bank shares. Shareholding has higher risk aimed at higher returns.
Dave , York, UK
The Government noe ignoring the £50000 limit? Perhaps their is a minister or two affected by the ICESAVE failure prompting this action!
John Robinson, Leicester,
Those people who are now saying investors in a 'foreign' bank are 'rate tarts' will no doubt have their money in HSBC (Hong Kong and Shanghai....) or Abbey (Santander, Spain)
Just like cars, there are very few truly British stand - alone institutions. Banking is global are thats half the problem.
steve, stevenage, uk
This was never meant to be 'high risk' - we put our money in a bank, not stocks. Customers were continually assured their money up to £35K was protected and guaranteed. The Icelandic government should never have allowed people to deposit 153X more than they could protect & mislead UK savers.
Laura, London, UK
D Zakharovic should realise that many banks in UK are now foreign owned and it should not matter whether a banks roots are from Iceland, the moon or Mars. We should be protected full stop. Its the same if Abbey went bust, UK savers should be entitled to their money even though its owned by Santander
C Reed, Wolves, UK
The important point is that ultimately these savings would be withdrawn and mostly spent in the UK helping the British Economy. If no compensation was given the only winner would have been the Icelandic Government which literally seems to have hijacked the money.
HOWARD, GLASGOW, SCOTLAND
We had our life savings in Icesave, considerably more than the £50,000 protection limit! This was not some risky internet site, it was an FSA regulated lending institution of good standing and backed by a supposedly sound Bank! Thank goodness Gordon & Alistair have agreed to support UK investors!
Will, Leatherhead,
If the Government is guaranteeing all deposits of British customers in a foreign bank it has no option but to guarantee all British deposits in British banks.
legal action against the Icelandic government ? for what ?
there won't be much of Iceland left after this - hey - maybe we'll get the cod
Stuart, Glasgow,
Icesave counted their chickens before they hatched and consumers put all their eggs in one basket.
Micheal SMith, London , UK
Icesave was a reputable online shoot-off of the 2nd largest bank in Iceland, and no one could have imagined when they deposited their money there, maybe months ago, that Iceland could go bankrupt and renege on it's obligations to compensate. Easy to call people stupid with hindsight!
J , London, UK
This is descending into farce. I'm all for guaranteeing investments. But to write a blanket guarantee for people who knowingly took on high risks is insane. We'll see more populism from this idiotic government - we taxpayers will be left with the bill long after Labour is on the slag heap of history
Chris, London,
Icesave had compensation schemes proven to be worthless and maybe even tantamount to fraud. People invested in Northern Rock/HBOS and look what happened to those 'safe' havens. Would the FSA be able to pay all deposits if a British bank went bust?No. Worded guarantees are cheaper than a bank run.
KeithA, Harrow, UK
Dmitry Zakharovic: I would hardly call a cash ISA a 'high rsk high return' investment- is this what you really mean.
Population of Iceland, about 300000, affected investors, about 300000 = fair fight. If the government don't turn up the goods, lets invade and conquer those robbing icelandics
steve, Reading, UK
Yet again the irresponsible are rewarded- you should read the small print before depositing.
If you save with a UK bank then yes you should be bailed out by the UK government, but not with a foreign bank- that's just tough luck.
BMG, Dumfries, scotland
Mother may of gone to Iceland! But I won't....I heard about Iceland reneging on their commitment this am via Alistair Darling on Radio 4 he also said, much to my relief; that the government would pick up the tab and honour depositors savings. After thanking God I said a heartfelt thankyou Darling!
John Healey, Herne Bay, United Kingdom
It right that the UK has stepped in. This wasn't some tin-pot bank people stumbled accross on the net, it was regulated by the UK authorities and backed by 4 European governments as well as our FSCS. It also had sizable assets in the UK, which our govt can seize to recover their costs.
David, Swansea, UK
1 Who owns "British" high street banks? Any guess?
2 With interest rates way below real inflation, it makes PERFECT economic sense to move savings to a high interest account.
3 Why did British banks not offer any competitive rates rather than waste money on subprimes?
4 Where is all the money now?
A Hoelzl, Brodick, UK
As a UK taxpayer I am delighted that the Government will rescue my small savings from IceSave. This savings opportunity has been promoted by Martin Lewis for a long time. Think on, I will be spending the interest I earn in the shops in the UK!
Linda, Leicester
Linda Dixon, Leicester, England
Why should all their money be guaranteed? I think its fair to have a limit of recourse - but a full guarantee! So, I and many others with no savings will have to pay to reinburse those with significant amounts stashed away. Stealing from the poor to give to the rich - this is just plain wrong.
Steve-O, Horsham,
Like others here my money left my Icesave account yesterday but never arrived in my linked current account. Absolutley outrageous behaviour who let these tthieves into the UK banking system; they are fleecing us like Roman pickpockets!
Peter, Tonbridge, UK
To Stephen Green, Correns, France
Britain can take the authorities to the Icelandic Supreme Court as they are viewed as breaking Icelandic laws on compensation, (thankyou "independent judiciary")
Whether they have a case or whether they would win even if they did is another matter.
Chris Kirk, Loughborough, UK
Let's clear this up. ICESAVE was a UK bank, had FSA registration. It's not a high risk investment, ISAs and the other accounts are savings accounts, not investments or pensions based on the stock markets! It is no different in basic terms to an account with another foreign owned bank-HSBC,Abbey etc.
James, Birmingham,
My husband and I both took out a cash ISA with Icesave thinking that our money was safe and secure in the type of account which the UK government was encouraging us to save. We had no idea we were taking a risk or we wouldn't have opened an account with a non UK bank.
christine taylor, Barking, UK
For those referring to foreign banks hope your not with Abbey or A&L, perhaps B&B. All owned by the spanish!
Why should the savers suffer any more for the actions of "the want it today brigade" who are up to their eyes in credit and can't pay it back! Well done the Government from a staunch Tory.
Roger, Leeds,
So like iceland.When will our country go bust and the pound become worthless.Next week maybe.You can then be sure that wherever you have your money stashed.It won't be worth anything anyway.Bit like Zimbabwe.
Mike Baldwin, Rushden,
Everyones jumping on the 'foreign bank' bandwagon. Erm, hello, who is the likes of Abbey and Alliance & Leicester owned by? Yep, a foreign group in Santander! Icesave has UK based addresses, managers, staff & callcentres etc the same as ING or anyone else. Why should Icesave customers lose out?!
C Reed, Wolves, UK
Whilst the government is lashing out to save Icesave investors , it might also consider the compensation of Equitable Life policy holders who have been waiting for years to be compensated for the recklessness of its former mangers and poor regulatory practice by the FSA and treasury.
Phil Egan, London, UK
many opted for icesave because of the nice FSA stamp attached to Icelandic banks. If you question that you should question the validity of moving capitals in all of the european economic area.
I say sink their fishing fleet.
marco, london, UK
For the majority of the savers, those with less than £10,000 in Icesave (I have £3,600 - a massive chunk of my deposit for a house which has taken 3 hard years to save) there was no way of knowing that Iceland would not fulfill its obligations and gurantees. We thought we had made a safe choice.
Mark, Milton Keynes,
I would like to re-itterate that these are savings -
Bernie , Reading
And I'd like to re-iterate that you decided to invest these savings, because you weren't happy enough, you wanted more, so you invested with a firm that gave you the highest interest.
Your choice. Why should I pay for you?
Tom Franklin, London, UK
I am most definitely not a rate tart. I was disheartened with huge profits being made by British banks. I thought as this bank was trading in the UK it was regulated by the UK - obviously not. All savers no matter which bank, should be guaranteed all of their monies back.
Pauline, Glasgow,
For savings up to 50,000 pounds I think the British government should step in. A condition for doing business in the UK as a bank is that you are part of a deposit guarantee scheme. The UK regulators allowed the Icelandic scheme and therefore has an obligation to these Icesave savers.
Robert, Bath, UK
I for one placed 200k in a bond in January following lots of press as to how good their rates were rather than use the stockmarket. In January there was no fears of banks going down, there was no press like there is today about the financial guarantee. As this was a bond I could not withdraw
Glenn, Sheffield, UK
This is pure panic from the government, they do not know how to solve this crisis, they had a year to come up with a plan after NR went bankrupt and they still have no idea whatsoever on how to deal with this, i have started stock piling food, as i have absolutely no confidence in the govt.
Peter Rogers, Rushden, UK
Why not give credit to Mr Darling and Mr Brown.They are certainly in line to get my vote come next election and I`m one of their most severe critics.The reason is that they have done the honourable thing.I have £30000 with Icesave.This was placed with them under terms which guaranteed the first £35k
Norman, Notts,
Hold on - what do they mean "up to and above the £50K limit" - does this mean funds held in UK banks are guaranteed to a £50k limit, but funds in failing overseas banks have an unlimited guarantee by the UK government?!?
Peter, London,
To Dmitry and Rahul and Terry from London, among others, I hope you never have to experience your savings going down the pan like this. This is people's hard earned savings in what should be the safest place to put your money - we cannot afford to lose this cash and I welcome the Government action.
Pete Biggs, London,
I can't believe how conceited people are being about Icesavers. No one could have predicted this! Most tried to get their money out when the story broke but couldnt. The people who should be punished are those whove stacked up foolish debts in an ego-fuelled desire to buy things they dont need.
kate Arnold, Birmingham,
I take issue with all the criticism of Icesave customers as being greedy or foolish. The bank was recommended by many reputable Investment web sites, magazines, and newspapers. Had we withdrawn our money prematurely we would have been accused then of panicking. I praise the govnmt for firm action.
Paul Shaddick, Bristol, UK
The point that many miss is that the the Icelandic guarantee is mandated under EU law, so the Icelandic govt (who have nationised Landisbanki) is in breach of EU law when they were operating in the EU. Secondly Icesave was approved to operate in the UK by the FSA so UK govt has some responsibily.
Stuart, Sheffield,
I had an IceSave account but after reading that the bank guaranteed only £16000 I moved my money to a bank fully covered by the FSCS. I would have done better and earned more interest by leaving it in IceSave! My savings are only guaranteed up to £50000 but Darling has pledged full cover for them.
Chris_S, Herne Bay, Kent, UK
My partner and I had 6000 pounds as an ISA in Icesave. These are tax free government backed savings for hardworking people that want to save for the future. Some of the comments here reflect the views of people who don't save and are the first to sponge off those that do. Well done the chancellor
Adam, cheltenham,
There are some really churlish people out there! A few months ago investing with Icesave was regarded as a 'best buy' providing a little more interest than others at the time. Nothing wrong in that. I congratulate the chancellor and PM for taking this prompt action to safeguard mainly modest savers.
JPS, Scunthorpe,
The really annoying thing about all of this is that i now have to feel grateful to Brown and Darling
Frank
Frank, bedford,
I can't believe they were still taking deposits up to midnight Monday - and they've recredited the money I attempted to withdraw.. what a scandal. Here's hoping they get it sorted quickly as I was in the process of moving house and now can't
Graeme, Edinburgh,
The Icelandic government have stolen money that British nationals have invested in Britain. This is despite guarantees that the money was safe. The government should seize all Icelandic assets in this country and use these to pay the money back. And if thats not enough send in the Navy.
Phil, Newbury, UK
My mum put her retirement money into ICESAVE to top up her state pension. She lives in a council flat. I cant believe some of the heartless comments from Times readers. My mum wasnt a Wall street trader or a risk taker. She was a home care assistant, who brought up five children. Give her a break!
Paul, Leeds, England
The government has given away taxpayers money by guaranteeing funds above the 50k FSCS limit. I feel the government has just stolen from me to give to the rich (ie those with more than 50k cash!) taxpayers money is needed in schools, hospitals etc not given away! 50k is the limit - stick to it!
Tim, London, UK
"Stumbled across on the internet"??? I am a very low risk saver who doesn't understand any way of saving other than a basic instant access savings account. I found Icesave repeatedly recommended by Which? magazine which is exactly the sort of magazine people who don't want to take risk read!
Debbie, Reading, UK,
Here is the bottom line: if you think the government can save you, you are living in a dreamland. The government can not save you. The government can not help you. Socialism simply does not work. Government heathcare doesn't work, government schooling doesn't work, government anything doesn't work
John, Dorset, UK
I'm intrigued as to the who, why & how money is misused in this cavalier way. Can all this be placed at the feet of criminally irresponsible capital gamblers? The directors of Landesbanki et al should be prosecuted. It's abysmal that the economic stability of the world can be affected like this.
Chris Steiner, Hinckley, England
You take the risk by going to foreign banks to get higher interest rates so why should I as a British taxpayer get the bill. Support Britain and it will support you but don,t come crying when you only have regard for your own interests
Paul Wood, sheffield, South Yorkshire
I would like to re-itterate that these are savings - I am not someone who has been spending wildly on credit and got myself into this situation through my own greed! I am sure that most of the people affected are in the same situation, and I welcome the fact that we will be covered
Bernie , Reading , UK
If HMG really is guaranteeing all the deposits in Icesave above the magic £50,000 then surely it is time for them to extend the guarantee to all savers deposits in banks that HMG has allowed to operate in the UK.
Michael Smith, Southampton, UK
Thankfully I haven't got my savings with Icesave but I sympathise with people who have and I am delighted that the UK government is going to bale them out. It is disgraceful that overseas banks are being allowed to operate in the UK, with (it now appears) very little equity to secure their deposits
Richard, Manchester, UK
I am appalled at some of the comments here. Most people had less than 50K in savings in the UK arm of icesave. The government's bail out plan is good news. Without it, taxpayers would still have to help those savers who lost everything by paying out benefits instead.
MG, Stockport, Cheshire
Icesave was in no way a risky investment- in fact not an investment at all, but simply a savings account
Alastair Duncan, Northampton, UK
Did you put money in there expecting it to increase?
Did you give your money to Icesave expecting interest and therefore greater returns?
YOU INVESTED DOH!
James, London, UK
Annie, sit tight sweetheart, you will be contacted but print of a statement as soon as you can.
Rory, it should show up back in your Icesave account before Friday afternoon.
Same thing has happened to me and plenty more, it is better if when you took out the money you did not close the account?.
Mark Caine, Stoke, Uk
I tried to get money out of Icesave on the weekend and it went from my account dated 6th October, but Icesave have clawed it back, I have just logged on to the website and the full amount I tried to get out is back listed as a "correction". So they were stopping funds as early as Monday am
JPW, Aylesbury, England
Mike,
So if I have say, £500,000 in cash from the sale of my house for instance, are you telling me I have to find TEN different institutions (registered separately with the FSA mind) paying a decent interest rate while runaway inflation actually makes me poorer in real terms?
Bill, Oxford, UK
Cod, Cod, COD is all they ever had (apart from hot Ponzi money from Russia). Not much of a security, when hard times come. Fortunately I like cod, and will keep buying (with chips) so there's some good to come of it all.
Steve, T Wells, England
Do not forget that the Icelandic banks have a lot of assets, which are now being sold.
Therefore, the tough talk by your government is just demagoguery, and their pledge is worthless, as it will not come to pass.
Ulfur, Reykjavik, Iceland
Does anyone know what the situation will be regarding interest? I elected for interest to be paid annually and this would have become due in Feb 09. Consequently, my current balance is the same as my initial deposit - will i be able to claim any interest for the 9 months since Feb?
Rich, london,
Annie Knight,
The best way to find out how to get your money back is through the FSA website:
http://www.moneymadeclear.fsa.gov.uk/contactus.aspx
The arrangements to ensure everyone gets their money back are currently being worked on:
http://www.moneymadeclear.fsa.gov.uk/news/firm/icesave.html
Seb, London,
how many times do people have to be told;
DON'T DEPOSIT MORE THAN £50K WITH ONE BANK.
Now my tax will pay to bail out those who can't understand a simple statement
Mike, Sole Street, England
What about transactions in process as of Tuesday? I have £18,000 not showing up on either my Icesave statement or my host account. I am worried that this is now lost
Rory, Exeter,
So Darling and Brown are going to compensate British investors with FSCS funds, to which of course Icelandic banks paid nothing and for which all the money comes from those British banks from whom the Icelanders pinched business by offering higher interest rates.
Jacques, London,
can someone advise me what you do about trying to recupe funds from Icesave I am totally confused with all the media reports , Im a pensioner and this is my lifes savings, can anyone advise me,
annie knight, elgin, scotland
Thank goodness we are live in Britiain!
I do not have any money in Icesave but I am please that our government is there to help its citizens.
Savings are not like shares. When we save our money in a bank we do expect to have it returned.
Shares are a risk of high returns or big losses.
Barbara, Hereford, U.K.
These comments blaming the savers are ridiculous. Icesave was in no way a risky investment- in fact not an investment at all, but simply a savings account regulated by the UK FSA. If it happened to be your bank, I think you'd appreciate the government honouring the guarantees they've made
Alastair Duncan, Northampton, UK
I think all IceSave customers (and I am one) should be repaid up to the £50,000 maximum. They were offered an Icelandic/UK Government insurance. It was what was promised on the opening of the account.
Graeme, Middlesbrough,
I invested in Icesave when saw an advert in a tube station its interest rate was only just above Barclays, not high risk and on bestseller lists for savings
Iceland government are trying to steal £4.5 bn of uk money in those accounts which would mean taking that money from our economy.
Jim, hackney,
Another point worth making is that Icesave was rated by Moody's (and other reference agencies) as being able to deal with all short-term (a year or so) liabilities - that was last week when I looked - same rating as many High street Banks - so if Moody's don't know what they're talking about.....
Keithm, Dartford, UK
The British government is quite correct that Iceland cannot be allowed to easily walk away from its obligations.
Landsbanki has made extensive loans to British industry and these assets must be seized if there is any attempt to walk away. Do we want the British taxpayer to suffer even more?
Mike Bennett, Chatham, Kent
I am pleased to back the Government backing the savers. An anology could be drawn with the NHS. We don't (well, some of us) rant and rave when someone gets injured because they cost us taxpayers money. At the end of the day we are all in the same boat in the same small global economy.
Tom, Faslane, UK
why should you get over £50k? I have lost significant amounts in shares I own and have saved - on this basis the government should bail me out as well ridiculous make your decisions and live by them!
chris, stowmarket,
If you want a high return you have to take the risk that comes with it. Spread the risk around within the 50K. This is the nanny state again. If you greedy suffer the consquences. Why must other people (tax payer) bail you out.
Sipho Madlala, Nott's, UK
Nice comments about rate tarts etc...... Good honest people put their money in what is supposed to be a safe place and it's their fault if it goes wrong. You say investing outside the UK is bad for the economy, have you never been abroad or owned a foreign car bought foreign goods.
Francis, Twickenham, UK
I have never voted before but if my savings in Icesave are returned to me with help from the goverment, then i will be voting Labour.
Long Live AD.
Mark Caine, Stoke, Uk
"Why should the tax payer bail out a foreign bank?"
Clearly, they are not. The taxpayer is helping UK customers only, not rescuing the bank. The taxpayer was happy to take the tax on my interest, so I'm glad they're helping out now.
Richard, London, UK
I think all Iceland nationals should have to pay a £100 visa to visit the UK from now until this is paid back.
I second those arguments against recklessness - if you put it in an ISA, keep below what's protected by the FSCS, then really, are you being reckless? Stick your schadenfreude...
andrew lees, london,
ve never voted labour in my lifetime, but well done Darling you have now secured my vote forever, £34,000 is now hopefully safe.
andrew, london, uk
Oh please.Icesace was a bank regulated with the FSA.When I checked with the FSA abouth the passport scheme, this said this was a safe place to put your money. Hardly gambling at 6.5 % just the one of the best at a time of low interest rates when inflation is eroding your savings.
vanessa , alnwick, england
I have £150000 of Business tax in this baank what will happen to my company? will the taxman let me off?
ian roche, Liverpool,
There are some unpleasant people posting here. Icesave was not a high risk investment. It explained its rates by saying in its literature and on the web that it had no high street branches to finance - RBOS now offers a 7.25% ISA - a British bank is that high risk? Icesave invested in uk anyway
Keithm, Dartford, UK
If another bank crashes and savers are only allowed their limit of £50,000 there must be a legal case to allow them 100% compensation - if the government can do this for ICESAVE then they have to do it for all banks.
Neil, Wokingham,
Will savers have to wait for a lengthy court case against Iceland's unfortunate people ( via their government) before recovering their funds?
That might be an intolerably long wait for those depending on liquidity!
And if there is no money left in Iceland, even after legal action? Bust means empty!
Clare , Manningtree, U.K.
Will savers have to wait for a lengthy court case against Iceland's unfortunate people ( via their government) before recovering their funds?
That might be an intolerably long wait for those depending on liquidity!
And if there is no money left in Iceland, even after legal action? Bust means empty!
Clare , Manningtree, U.K.
I think we should have some sympathy for the people of Iceland afterall their banking system has all but collapsed. As one with an Icesave ISA, I researched the risks fairly well before placing my money with them and was content that the risk was low and that guarantees were available.
Robert, Prestwick, Scotland
Will Mr Darling please promise to spend taxpayers' money to bail me out if my curent deal goes wrong? (A really nice man I met in New York is selling me the Brooklyn Bridge at a very good price. And lots of people still recommend property.)
Robin, London,
I wonder if there is a fraud story in here somewhere. Does Icesave or someone in authority there own west ham football club? If so is it now nationalised!
Icesave was based in the UK, regulated and guaranteed so in no way was it a high risk investment - well done Mr Darling for speedy action.
Alan, Southampton, UK
To Ed, London - you're a real selfish individual. I'm a hard working higher rate taxpayer and I'd deposited some of my cash with Icesave for my wedding. This is going to be a very difficult time for myself and my partner if we lose the money or are unable to pay the people we have booked.
Grow up!
Phil, London,
I can see from the reaction in the comments people are very angry about this decision.
Can I just say I am one of the 300,000 however I only deposited £2000 and I'd come to accept it was my decision and my responsibility.
Can we now tar all depositors with the same brush i.e. "rate tart".
Patrick, Saltaire, United Kingdom
Can anybody confirm if Icesaves advertising or documentation stated investments were covered by the FSA.If not why are the British government getting involved ?
David G , Altrincham, England
I am staggered that people should suggest its not fair that British depositors savings with Icebank will be supported by the UK government, over the £50,000 FSCS limit. Dont forget, ALL depositors money with Northern Rock and Bradford & Bingley was saved, why not the UK branch of Icesave?
Craig Bulmer, YORK, North Yorkshire
Icesave was a bog standard online savings account, not some kind of dodgy offshore hedge fund for the super rich - utter nonsense to characterise it as high risk. And nonsense to call ordinary hard working UK taxpayers (including taxes on interest) as "rate tarts". Twaddle
Simon, London,
For people against the Government helping, have they thought of the consequences to the UK economy of losing £4+ billion?
I put good odds on everyone bringing the Icesave money back to the UK and putting it in a TAXABLE UK interest bearing account (minus ISAs). Money/Tax for the UK Govt/people!
Andy, Loughborough, UK
There seems to be a misperception that a fixed rate bond paying 7% is an inherently riskier product than one paying 6% . The people who have lost are responsible savers, not the reckless credit junkies who took loans they couldn't pay back from irresponsible (and often British) banks.
Tony, Sheffield,
I was lucky having withdrew money last week from my Icesave account to pay a builder. I was luckier still when after advising my sister and my girlfriend to deposit their savings in Icesave their inertia meant that they failed to do so. I made a mistake, but let's not get vindictive with savers.
Stuart Matheson, Norwich,
It is not as starightfoward to have dealt with the growing problems over the last year as some seem to assume. We were tied into 2 year fixed bonds... those having been reinvested as they came up in the Halifax... we assumed that any FSA regulated bank was okay - as it was not off-shore.
Brian T, Edinburgh, Scotland
I dont have any dealings with Icesave but well done to Gordon Brown/Alistair Darling for not leaving savers at a loss. we need to encourage more savers.
But I hope they pursue the Icelandic Government for as much as possible
Rob, Chorley, Lancs,
Some people here seem to consider a cash bank account a "high-risk" investment, which is nonsense. Savers expect bank accounts to be safe(ish), at least to the limit of the compensation scheme. Ordinary people should not be expected to anticipate an extraordinary Icelandic defualt.
James, Cambridge,
The investments made in Icesave were not "high risk" - they came with a guarantee and were not linked to the stock market. The rates were attractive, but not outlandish - often being beaten on best buy tables.
It is right the govt supports savers in the UK.
Ben, London, UK
plenty of british institutions were offering similar interest rates to icesave so i think it is unfair to call us greedy. also we were led to belive that this was a british company, eg .co.uk there are plenty of international companies including hsbc doing business in england.
mary, london,
we are 'rate tarts'?. . .you should really be ashamed they were fsa approved and the interest wasnt suspiciously high. . you are simply gloating from an apparent 'dryer' position. . not sure where your money is but dont be shocked if your bank goes down tomorrow and you cant log in online anymore.
lucy, london,
Icesave legally operated in the UK with a deposit guarantee and was frequently recommended in national papers. UK government is right to compensate depositors if Iceland won't as it is not their fault. UK can always seek repayment in fish!
P Day, Dartford,
What exactly is a 'British' bank nowadays anyway? Abbey is owned by a Spanish bank, HSBC by the HongKong and Shanghai Bank, all the larger banks have branches in many countries. This is what globalisation IS. Icesave accounts are as 'British' as any other.
Jim, Congleton, UK
If you put your money in any savings account in a western country you expect it to be 100% safe. If you invest in the stock market you must be aware you are risking 100% of your capital.
I have maxed out guarnatees with B&B, HBOS and Icesave, i mean Santander, Lloyds, the government!
Heeners, Bath,
Your article says the website is frozen - that's not true. The Ice save website itself is working and in particular I was able to get a screendump of my accounts to provide evidence of current status if needed later.
Tony S, Tring, UK
The gvt. are doing the right thing. ICESAVE investors are not 'high risk takers' who deserve to loose out - they are pensioners and hard working families who thought the bank was a safe place to be. It seems to me that the Icelandic gvt. are attempting to use British cash to bail out their country!
GlenD, Wigan, UK
Charadutt is right. We should seize all the Iceland stores and rebrand them Great Britain. Kerry Katona could do a comeback with the old "Mums gone to Great Brtain" slogan
David J, London,
Neil, if you're horse was guaranteed to give you a certain % payout by its owner, if this guarantee was backed by the government of it's country of origin and Britain, and if the British government had encouraged you to bet on this particular horse (as it did with Icesave's cash ISA!), then yes
Tony, sheffield,
What is Gordon Brown saying here?? Is the British government going to give icebank savers there money and then sue the Icelandic authorities later, or what? As always politicians trying to give hope yet no firm backin or adaquate information.
Maurice Collins, Salford, England
The fault lies entirely with Brown - licencing and failing to supervise banks. I moved my money from an Icelandic bank 18 months ago because Icelands entire financial system seemed to me dodgy and built on the highly suspect premise that Icelanders were somehow masters of the financial universe!
Fred, Manchester,
By "Treasury", you mean the taxpayer. Why not say so?
Jeremy Poynton, Frome, England
I'll declare at the start that my wife and I have over £30K deposited (not "invested") with Icesave. Icesave are a UK bank owned by a foreign EEA neighbour. I agree that those who have invested > £50k have taken a risk. Those who deposited < £50K have not, it is a bank deposit NOT an investment!
Paul, Hartlepool, UK
Sorry, but anybody who deposited a large amount of money with Icesave was foolish or greedy. £200k life savings? Absolutely crazy, for an extra half point interest. Even in good times it should be spread around. They never heard of "don't put all your eggs in one basket"? Higher reward, higher risk.
Ed, London, UK
I lost money on shares that I had in Marconi, why didn't Brown cover my losses
Howard Rayner, Leeds,
Can I get one of those moral hazard free deals? I'll give the bank £100k, the bank pays me 100% savings interest, then they go bust, I'll get my money back from the tax payers. Heck, I'll even split the interest with my conniving bank manager!
Stephen, Horsham,
These rate tarts as you call them!!! Some are single parents who were looking to raise a little more interest from the small amount of money they have !!!!
Anna , Rochdale, England
To all the people who question why the government should reimburse people like me who have invested in a foreign bank to gain preferential rates of interest, - well UK banks invest abroad
all the time, and we're bailing them out as well - or would you rather they went bust and you lost yr money too
Steve Gregory, Falmouth, UK
Dmitry, what complete rubbish you know little about the kind of accounts that Icesave have been aggressively marketing in the UK. They're zero risk tax exempt savings accounts in which every UK individual is entitled to invest up to £3600 annually. The law in both countries protects that investment.
Scott, Plymouth, UK
God bless Mr. Gordon Brown. I lost all my savings in Serbia in the early 90ies and after 18 years I am still waiting to be compensated. Here, I worked hard to put £ 53 k in my Ice save account to save for my first home in the age of 45.
Goran, Loughborough, UK
why are ICEsavers being given better guarantee (100%) than everyone else (up to £50,000)?
Danny, London,
"no British savers will lose" on what basis will they be judged? Will Icelandic people, ordinarily resident in the UK, be covered? Will Brits abroad, maybe living in Iceland, be covered? What about non-domiciled persons from e.g. Russia who kept some money in Icesave and some cars in Mayfair?
Jamie, Monaco,
Hmmm... £180,000 with the same bank? That's WELL over the deposit guarantee scheme. Even IF Brown and Darling could retrieve all of it, there would be a loud outcry in the British public from all those saving with British banks to do the same for them. Only fair.
Morgan, Telford, Shropshire
Pensioners that had low risk with profit policies in the Equitable Life company, that failed due to poor regulation by the FSA, losing those pensioners thousands, will no dount look on with disbelief.
Their taxes are now to be used to bail out in full depositors in an Icelandic Bank
Eddie, Cheshunt, Herts
So people like me who thought that the Icesave rates were too good to be true and stayed with UK Banks/Building Societies have now got to bail out these people who were happy to take a higher reward but want me to pay for THEIR higher risk. MADNESS !!!
john, Oxford, England
I hate nu labor but Darling's decision is the right one as it will increase confidence in UK banks. (see JP Morgan on character in banking.)
Iceland must be in a truly desperate state. I feel for ordinary people there . They will need to catch an awful lot of cod to pay for this debacle.
Stoneman, London, UK
ICESAVE was not regulated by the FSA. It operated in the UK under the EU 'passport' scheme - it was regulated by the icelandic authorities and the FSA had to accept it without doing their own due dilligence. You bank with dubious subsidiaries excpect to get burnt
Steve Bowles, london,
i invested all my family's savngs in icesave (well below the 35K). i did this based on it being fsa approved, a uk branch of an icelandic bank, (similar to hsbc - bar the bankruptcy). i assumed i was therefore covered for first 35K. i have no shares, and am risk-averse. this was a deposit account.
MarketRisk, Cambrige, Uk
do I now PAY interest for a loan from the B of E, ?when I used to GET interest before my account was stolen.
Its funny how the B of E can create money out of thin air, then charge you interest on it.
john, london, england
i have £315,000.00 with icesave please dont tell me am the only one with this much in. this took me 30 years to save for my retirement which i was planning this year.
carl bodecker, london, england
Icesave ISA accounts. When compensation is paid out, will there be any way of preserving the deposit's tax exempt status and placing it with another ISA provider?
Sandy Irvine, Kelso, U.K.
anyone who put more than 50k in an ICESAVE account only has themselves to blame if they lose anything over that amount. My tax money should not be used to pay people who were greedy enough to put all their savings into ICESAVE rather than spreading it out to stay within compensation limitis.
ian, London, UK
I will vote Labour rest of my life if they save my house deposit from Icesave...!!!
This is the first thing Labour will have done to help me and it is the most vital to me...!!
Please Darling come to our aid and resolve this quickly..!!
delboy, Aberdeen, UK
Besides the savers with Icesave/ Heritable bank there are UK employees who are suddenly without a job or salary. They have been landed with a closed door and no money to pay their bills. I think that the employees are in a worse position than the savers, who presumably still have a job.
shirley hiscox, huntingdon, england
Thank you Darling. You have gone up in my estimation.
terry secretan, colchester, england
Neil Kefford, are what you talking about? these arent high risk investment portfolios, these accounts are people savings! Being that banks are refusing to honour their agreements (theft!?) offers no confidence in the market at all. The government is duty bound to reassure andsafe guard mechanisms.
Dave, London,
The government is risking a massive depression by rescuing every bank and sundry. What is the point of having a deposit insurance scheme if you just override it? Soon we will see the government unable to roll over its own debts and there will be a true economic collapse - ration cards and curfews.
Paul Amery, London,
John from London, go study risk/return 1.01!! 'Maximising' your return means taking on risk. If you don't want to risk losing any of your hard earned savings, buy gilts and accept the lower return. Long term equity returns only average 11-12% and is important to business to all businesses.
Doug, London,
Yes - we should rescue Ice Savers. They pay UK tax on their savings and did have trust in the banking system to make deposits. Landsbanki will probably have all their UK assets taken by the government to pay for this. WELL DONE DARLING!
Phill, Chorley,
I think many (not all) of us have learnt a lesson. The so called money specialists such as Martin Lewis and many others are not experts. They engage well and we blindly follow. They are TV personalities not IFAs. Great for council tax rebates but life savings advice - I dont think so.
bob, Gloucester, UK
If ICESAVE is regulated by the FSA (which i understand it is), the FSCS will pay out up to the limiteand if you invested over and above that then you lose that proportion. Unless the overall FSCS limit get increased for all FSA regulated banks, that seems fair to me.
Phil, London, UK
If you aim for the highest interest rate, you are aiming for the bank that is taking the greatest risk. Similarly, go for the cheapest airline and you have the greatest chance of cancellation (e.g. Oasis).
Spread your funds and reduce your risk. Remember BCCI.
Ian Tinn, Slough, England
Quite a lot of the blame for this belongs with financial journalists. Any insider in the credit markets will tell you that it was well known that there were serious issues with Icelandic banks a year ago, yet these journalists happily recommended Icesave without commenting on this risk. Why?
Tom McNerney, London,
Despite all the problems with the banks in Iceland, one major "price comparison" website still prominently displays their products under its "Savings" listing.
I do think this website should display a cautionary message.
alex, london,
Higher interest rates always used to mean higher risk, but if HMG are going to guarantee deposits why settle for a lower rate in a Building Society account or a National Savings bond?
Wouldn't this money be better spent compensating the Mirror Group pensioners?
Bill, London, UK
Dmitry Zakharovic, a cash ISA is not supposed to be a high risk investment! The government has encouraged tax-payers to use them and is right to protect them.
jack, St Albans,
lucky brits. here in the netherlands people don't have to expect any help from the dutch government at all.
i don't see why these banks should get away with theft - they knowingly misled their customers even until yesterday.
vicky, amsterdam, the netherlands
Whatever happened to risk/reward. To get a higher reward you generally have to take more risk (that is why bonds are the safest and have lowest reward). Icesave offered higher rewards because it was riskier! the government should not cover any more that it is obliged to
Andrew , Cambridge,
As an Icesave customer myself who has been sick with worry, I can't believe the nasty comments from posters here along the lines of 'it's all your fault'. These are bank deposits for goodness sake, not risky stock market investments. 3 cheers for Gordon and Alistair for giving their guarantees.
Len, Sheffield, UK
I think that there has to be a distinction made between putting money in a savings account and buying shares in a company. People need to be able to keep their money safe somewhere whilst maximizing the returns, its not like gambling on the stock market. All UK savings should be guaranteed.
John, London,
I am glad that government is doing their duty to safeguard the interests of ordinary people. Icesave was recommended by many newspapers (Sunday Times, Money section) as a safe investment. Many people have invested their life -savings, which is what we were advised to do.
Eve , Swansea, UK
I just want to thank the UK government for taking this approach. I saved over £11,000 with Lloyds TSB and then Halifax but only moved money to icesave in the summer. I did not consider it a risky investment. If Iceland refuse to pay up they should provide UK with free seafood and energy contracts.
Martin Howell, Cromer, UK
Byron, Lincoln,
I wish you had lost the lot to be honest. Tax payers money could be better used almost anywhere other than bailing out rate tarts who undertake no due diligence with their capital.
Cavet Emptor should be the motto of this story..
Dave C, Chichester, uk
Iceland has a 'Passport' agreement where they pay the first 20000 euros. Iceland are apparently happy to renege on this agreement. The Gov'n is saying that they will pursue Iceland (a rogue state here) for the funds ensure that the depositors get the money, surely this is honourable of the Gov'n.
Kevin, Milton Keynes,
A 'high risk' return? Putting money in a cash ISA? How does that equal a high risk investment? If I had put money into shares then yes that could be high risk. But a cash ISA is a government approved way for saving money safely.
James, Cambridge, UK
Putting cash into an ISA with ICESAVE is not supposed to be high risk. Government supports this with tax benefits. The FSA permitted this bank to trade here & ICESAVE is UK based. Royal Bank of Scotland owns NatWest & lost £6bn & 40% equity. It's British & yet itssavers may need protection.
BENITA E, London, UK
'high risk, high return' - what 6.3% interest with a guarantee from the FSA - hardly. These are people who have put their life's savings into what they thought was a high street bank with an office in Newcastle. I say thank you to the govt for preventing the panic spreading.
Janice Smythe, Bridgend, Wales
I've got 210K in Icesave. I do feel stupid and naive now. Worked for 11 yrs in NHS and saved hard. The cash is from the sale of my home. I'll vote labour for the rest of my days if i get it all back. right now i'm feeling absolutely gutted. I hope this works out as it seems. I've learnt my lesson...
nhed, warwick, uk
@ Dmitry
most icesave accounts were not a "high risk, high return investment" as you put it; it was a *savings* account. yes they offerered marginally better rates - but cash savings aren't a high risk strategy!
Brits were handing savings to the bank, good people doing doing a 'sound' thing
Luke, Bournemouth, UK
These are exceptional times and it is encouraging that our Government is prepared to back savers. After all, this is a bank which was authorised by the UK authorities to operate in the UK and accept UK savings, and for which deposit guarantees were in place. The guarantees must be honoured.
James Brooks, London, UK
Well, Dmitry Zakharovic, Taipei, taiwan, you seem to struggle with ignorance
A bank offers a slightly better interest rate for savings - would still seem attractive to most open minded individuals.
A savings account at the end of the day - not some gold or diamond mine, or an investment in Taiwan
Alan, Beds, UK
My wife and I have between us £173,500 in Icesave, mainly the proceeds of a property sale, with CGT due in January. Perhaps the government might consider seizing any Icelandic assets to hand as a start. That includes House of Fraser, Icelandair, Hamleys etc. Who owns their embassy building?
Jerry, Chorleywood, UK
7.06% - Hardly a high return for an internet account.. High street accounts offer 6.5%.
Not stumbled across on the internet but widely advertised and endorsed in the national press. The Daily Mail apologizes for its advice about Icesave today .
British banks invest abroad don't they..
T Martin, Bromley, Kent
I am a single mother with my life savings of 7K in an ISA with ICE Save. I have been mislead and missold. I am furious and words can't explain how upset and angry I feel. I cannot believe that they can freeze all these peoples accounts.We cannot access our money which we have saved for all our lives
s field, barnet, england
Government stand on this must be lauded. The question now is how quickly. People cannot wait for 3 months to take money to pay for essentials in these horrid times. People who think it is tax payers footing the bill must understand it is more than that i.e. a country defaulting on its commitments
Tim, London, Britain
How is it 'naive and stupid' to "save" money in a bank that is authorised by The Financial Supervisory Authority, Iceland and the UK Financial Services Authority and regulated by the FSA.
Financial protection is by Icelandic Depositors and Investors Guarantee Fund & UK FSCS up to £50k.
Carl Wells, Birmingham, UK
The whole premise of deposit guarantees in the face of shareholders risking the loss of their entire capital is abhorrent. Rates already reflect the risk of your capital being returned. Savers protected by the deposit guarantee scheme should therefore never earn any more than the risk free rate.
Joel, London,
In response to Dmitry Zakharovic, the rate on my internet Isa with Ice Save was 6.05% at the time I took it (early 2008). It was therefore one of the better rates on the market, but not the best. It was also guaranteed by the Icelandic and UK authorities up to £35k. Hardly "high risk, high return"
Martin , Manchester, UK
To Stephen who thinks that there is no mechanism that the British government can use to force Iceland to honour its obligations to UK depositors, agreements governing the EEA (EU plus Iceland and Liechtenstein) cover this.
Brown is right to pay UK savers and take on the fight with Iceland himself
James Brownley, london,
Icesave were offering a good rate of interest and investing in UK companies, therefore many people, like me, were happy to put their money in it., however I think it is stupid that people have put over the £35000 guarantee in there.
Caroline, Oxford, UK
Dmitry, your comments are inaccurate. These were not marketed as a "high risk" investment but a simple bank deposit covered by the FSCS. Only recently I read on icesave's brochure the reassuring, but ultimately misleading, statement that they have no direct exposure to the US subprime market.
Olaf, Hong Kong,
Most British banks barely cover the erosion caused by inflation, so unless I shop around, I am losing money. Prior to the financial turmoil, Icesave was a safe investment, which we thought was covered by guarantees.
ISAs can take weeks to xfer out. Many of us simply didn't have time to get out.
David, London,
I backed horse on the National and lost, should I apply to Gordon for my money back?
Neil Kefford, Much Wenlock, England
Government should seize assets of Iceland in UK, sell it quickly, pay the depositors, pocket the rest & say 'fine thank you' to Icelander's. If this is not a diplomatic wrangle necessiating execeptional powers of the government to be unleased what else is. It is UK tax payers money we are talking.
Charudutt, London, Britain
"These rate tarts should have saved at a British bank".
Great Idea, could you do me a favour and find me a safe British bank?
Damo, London, UK
Interesting comments from those who obviously don't have money invested in Icesave. I would say that when the FSA backs and regulates the UK arm of a foreign bank, then it should be a pretty safe bet ... I have money invested in Icesave and I'm glad the FSA and FSCS are fullfilling their obligations
Richard, Cowbridge, Wales
I researched the guarantees on Icesave and put in less that £30k. How was I to know that the Icelandic government, a sovereign entity, was going to reneg on it's agreement! I agree that the UK government should take the strongest possible action, and thank them for stepping in to protect my savings.
Charlie, London,
Quite a few comments suggest that ICESAVE was a dodgy offshore investment... it was a bank with normal savings accounts that any other bank offers. Interest payments were liable for UK tax. I had £4000 in my account... how imprudent of me for saving for a rainy day with a FSA approved bank...
Andrew, Warrington, UK
In defence to some accusations appearing here, Icesave was the British arm of a foreign bank. It was regulated by the FSA.. Some of us also had our money in fixed term bonds so we couldn't withdraw it even though we wanted to, and it wasn't "high risk" at all when I deposited my money last year.
Vanda B, Milton Keynes,, UK
Good to see that the government is helping people out.
Yes I do have savings with Icesave, but those people who say this was a high risk investment in nonescene. Icesave is regulated in the U.K by the FSA and in all honesty should have been more tightly regulated to stop them getting in this mess
Phil, Leeds, England
Icesave is not an offshore bank. It is a UK bank owned by an Icelandic Bank. It is/was regulated by the FSA who are correctly standing behind it.
Derek, London,
Rahul, Terry and other sanctimonious, holier-than-thou comments - the interest rate on icesave non-isa accounts was 6.3%, hardly a lottery win. The effect had the govt not acted today would have been to have wiped out all remaining consumer confidence in the banking system. Grow up.
Jack, London, UK
Comments from knuckleheads saying that Icesave customers should not be reimbursed are contemptable. Have you not heard it's a global economy? This was an FSA regulated UK based operation. HM treasury took tax from interest. Why should I pay for N'Rock customer losses made in the US sub-prime market?
Mick, Stamford, UK
If a gunboat or two is required , lets do it, there are at least 300,000 people in Britain who would be happy to mount a raid on Iceland to get their money back. I am one of them.
The FSA backed Icesave, all the money pages/sites recommended Icesave as safe, why not put your savings there.
R T Lewis, Edinburgh, UK
Why should the tax payer bail out a foreign bank? These Icesaver customers took a 'high risk, high return' investment and now they want to be compensated. Why should the more prudent pay for the naivety and stupidity of others?
Dmitry Zakharovic, Taipei, taiwan
We should dispatch a gunboat immediately.
Kevin, Leeds,
Why did people put six figure sums in any one bank account, Icelandic or not, knowing only £50k is guaranteed? Why would you put one giant egg in one basket? That's such a shocking gamble to take. It's great us savers are getting our money back, but those who put in £200k should have known better.
enia, Manchester, uk
Culpability Brown says he will "sue" the Icelandic government. In which court? Iceland is a sovereign state and as such is impervious to the orders of any British Court. No international Court has any executive powers to enforce any order that it might make in favour of Culpability. Gun boat maybe?
Stephen Green, Correns, France
I feel strangely patriotic hearing that my government is actually going to be on my side in reclaiming my money. I do not rely on these savings, unlike many. I sympathise with those who now face a long wait and do need thier money back now.
Byron, Lincoln,
A bank called ICESAVE has frozen customers savings ! just like the name suggets ICESAVE !! Even Robert Mugabe has failed to bankrupt his country...how did Iceland manage this ?
Roger Ndaba, St Albans, Hertfordshire