The Post Office bank is restructuring in a move that will give its savings account holders the security of the UK depositor protection. The Bank of Ireland had previously provided the banks savings accounts, meaning that savers were covered by the Irish depositor guarantee. On paper, the Irish guarantee appears superior to the British equivalent, as there is no cap on the amount of money that is protection. However, with the Irish economy in an uncertain state, the possibility existed that the guarantee could be flawed.
Subject to ratification from the High Court, the Post Office will now operate through a UK subsidiary, meaning that the banks 500,000 savers will now be covered by the Financial Services Compensation Scheme, which has a £50,000 limit of protection per account holder, but is more secure than its Irish equivalent.
The move also has implications for National Savings and Investments, who also sell accounts through Post Office branches. Indeed, experts are hailing the restructuring as good news for NS&I, with potential customers now certain not to be deterred by the Irish connection.
Savers Boosted by Restructuring of Post Office Bank
Financial Services > e-banking > Banking news
Savers Boosted by Restructuring of Post Office Bank
Wed, 08 Sep 2010
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