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Santander restructure moves compensation goalposts

Santander restructure moves compensation goalposts

Category: Banking

Updated: 17/05/2010
First Published: 14/05/2010

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 It is now over 6 months old so the content may be out of date.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 a combined investment of £50,000 or more in Santander and A&L accounts may consider moving some of their funds after the Spanish group's restructure was rubber-stamped.

From 28 May, all of A&L's business will be finally transferred to Santander.

Currently, A&L holds a separate banking licence to Santander, meaning savers could have £50,000 invested with each of them which would be covered infer the Financial Services Compensation Scheme.

This means that investors could claim a maximum of £100,000 under the FSCS, or £200,000 in the case of a joint account.

However, from 28 May, all deposits will fall under Santander's remit, meaning cover from the FSCS will be halved.

Santander has said that this will only affect around 10,000 of the bank's 14 million savings customers, and that all of them will be written to, to fully explain the consequences of the change and their options.

Below is a selection of competitive accounts that savers affected may wish to consider should they want to move their money.

For those looking to lock their money into a long term account, Coventry BS offers a rate of 5.00% for its five year bond that can be operated online, in branch or over the phone.

Those who think a rise in interest rates could soon be on the cards may prefer to opt for Tesco Banks' variable rate account, which currently offers a rate of 2.75%.

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