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Southsea savers to receive compensation

Southsea savers to receive compensation

Category: Banking

Updated: 16/06/2011
First Published: 16/06/2011

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Savers with Southsea Mortgage and Investment Company are to receive compensation payments from the Financial Services Compensation Scheme (FSCS) after the bank was shut down.

The Financial Services Authority and the Bank of England acted together to close the Havant-based bank which had just over 250 depositors.

In a statement, the Bank of England said the failure of Southsea followed 'a deterioration in its financial position as a result of management decisions and the firm's specific business model'.

The bank had retail deposits of £7.4 million when it ceased trading, with the FSCS already confirming it is to step in to compensate customers of the bank.

Savers will be entitled to compensation of up to £85,000 each and will receive the payment automatically, without having to contact the FSCS.

In the majority of cases, eligible customers can expect to receive their money within seven days.

Any remaining claims, which are likely to be more complex cases, should be paid within 20 working days.

Customers of the bank with an ISA account will shortly receive a certificate from the insolvency practitioner showing the balance they had saved in their ISA on 16 June.

This will enable them to open a new ISA with another ISA manager of their choice.

Anyone with mortgages or loans from Southsea Mortgage and Investment Company have been told to continue to make repayments and service their debts in the normal way.

They will be contacted in due course and advised how loan and mortgage repayments will be handled in future.

Further details about the payout, including information about whether deposits are eligible, can be found at www.fscs.org.uk or by calling the FSCS on 0800 678 1100 or 020 7741 4100.

Eligible depositors with amounts in excess of the insured limit of £85,000 may be entitled to receive a share of their savings above this limit, as part of the insolvency process.

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