Extension of deposit rules proposed - Savings - News - Moneyfacts

News

Extension of deposit rules proposed

Extension of deposit rules proposed

Category: Savings

Updated: 04/06/2009
First Published: 04/06/2009

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 It is now over 6 months old so the content may be out of date.
The Financial Services Authority (FSA) has proposed that interim rules which allow separate compensation cover for customers with deposits in two merging building societies be extended until December 2010.

An extension for consumers of a society which merges with a subsidiary of another mutual society has also been proposed, as have rules for customers whose deposits are transferred from a failed firm to another deposit taker where they already have an account.

The current rules are set to expire at the end of September. These were bought in to address concerns that customers with savings in two merging societies, or those where deposits were transferred, could potentially have a combined investment that breached the £50,000 maximum deposit limit of the Financial Services Compensation Scheme.

Jon Pain, the FSA's retail markets managing director, said: "We now propose to extend the operation of these rules until December 2010, by which time it should be clear what changes will be made to the EU Deposit Guarantee Schemes Directive.

"We will then be able to put in place permanent arrangements which will take into account any new EU requirements."

The Building Societies Association's head of savings policy, Brian Morris, was quick to praise the move.

"Today's announcement is a welcome, sensible move and means members of societies that have merged, or whose deposits have been transferred to another society, will continue to enjoy the same levels of protection as if the merger or transfer had not occurred," he said.

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

Related Articles

Savings being used as a festive financial buffer

Good news from RCI Bank UK – its latest research shows that many of us are saving more than we were a year ago, but the question is, will you be dipping into that buffer to cover the cost of Christmas?

6 of the best easy access savings accounts

Easy-access savings accounts are as simple as they sound – they allow you to access your money whenever you need it, without having to give advance notice, and they also allow you to pay into them at any time. Here are six of the best.

Start saving for Christmas… 2017!

Christmas is just around the corner and our annual festive splurging is starting to step up, but are you prepared? It may be too late to start saving for this year’s festive spend, but it’s never too early to start for next year’s!
 
Close