Icesave Savings

• Icesave Customers Uncertain Over Fate of Savings
• Icesave Suspend Access to UK Customers' Savings Accounts
• Savers Get Assurances Over Icelandic Banks

This week has seen turmoil hit the Icelandic financial sector with the government nationalising two of the country’s largest banks, Landsbanki – owner of Icesave and Heritable Bank - and Glitnir.

Despite assurances from the Icelandic government that both banks would be continuing with their operations as normal, UK customers are currently unable to access their Icesave online savings accounts. The company have not released any details as to why this is although potentially it is to prevent a run on the bank similar to that seen on Northern Rock last year.

As Landsbanki is now owned by the Icelandic government savers do have assurances that savings up to £50,000 held with the bank will be covered in the unlikely event that it goes under.

The Nordic bank operates under a passport compensation scheme which ordinarily means that the first £16,000 of any savings with Icesave would be covered by the Icelandic government and any amount above this up to the £50,000 maximum will be covered by the UK Financial Services Compensation Scheme. However, Chancellor Alistair Darling has this morning assured savers that the UK government will protect British savings in Icesave with unlimited compensation.