Bank Of Ireland - Withdrawing deposits

My Partner went into her local BOI today to take out 100K of her savings to put into another bank so she would be covered under the Deposit Guarantee Scheme of 100K per institute, She was asked to wait and brought down to see a manager who proceeded to convince her to leave her money in the bank as the bank is the safest bank in the country and everything over 100K is covered by Government Guarantee.
She even went so far as to tell her that Bank of Ireland needed no bailout and they were forced into it and there was no need at all as they are very strong.

What do people think about this coming from BOI ? My Partner told her that I had done some research online and with an advisor and had told her to at least not have over 100K in any institute or better still to change it into sterling, She then asked would I be able to come in to see her for a chat. I don’t think I will as I am very annoyed over it and think i would see red with her telling me that the Irish government can guarantee everything.

They are correct, the government did guarantee all banks and that was the start of our problems. I cant see a very good interest rate for BOI and have very little in there.

changing to sterling is another matter

noah

Actually BoI have a subsidiary called ICS Building Society which has its own licence and er..its own guarantee.

jimmyd said:

and everything over 100K is covered by Government Guarantee.

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I thought it was everything under 100k?

The banks are running dry of cash and try their best to keep every EUR. But they haven't realized that they need to encourage people to keep their money with them (keyword competitive interest rates).

The truth is that BoI is no more save or un-save than any other Irish bank under the guarantee scheme. (no Ulsterbank)

If they go burst, it’s a question if they will be able to payout the banking guaranteed 100k or the state guaranteed unlimited to every savings holder. Interesting and still valid facts are under itsyourmoney.

Splitting the saving over several banks is a very good idea to spread the risk. If the domino will happen, it’s not likely that all banks will fail at the same time. Said so, if that would really occur then your savings are your / our lowest problem because that means that the whole country went south.
So you should consider spreading your savings over several banks to reduce the risk.

Another thing to think about!!
BoI and almost all other banks are not really competing for money. (They haven’t learned it yet because we all are lazy to move and check the best bargain)
With Inflation of around 2.5% and 27% DIRT you should not put your money below 3.x % interest rate. Now that’s not easy to find at the moment, but for example PTSB does have even a short Term fixed money starting at 3.x%. Again, don’t be risky and put all the money onto that horse but its helping the diversity.
Why Short Term? Short Term is good, don’t commit to long term fixed deposits.
The interest rates will go up. That’s a fact. Irish Banks are now trying to lure people with “competitive” 4+ % for 2 years.
You can bet that by next year the interest will be more than 4% if they want to stay in market to get cash. Said so, they will need to increase the interest rates which they of course won’t do for the long term committed money. Summary you’re screwed, again as usual.

Try to keep it short and shop around, it’s your money and you want the best of it.
On converting money to different currencies, I personally would steer clear.
There is no real benefit. For each conversion you have to pay a fee and that one can be pretty much (Banks want to earn money and don’t care about you) There is at presence no currency to be considered as “stable” enough to flee into and together with the DIRT you then still would have to declare and pay here (to stay legal) you lose money probably every day.
The EUR is still one of the strongest currencies simply because it’s backed by the diversity of all its member states. While the £ for example can easily go south once something “weird” happens in London only. The debts of Europe are nothing compared to the debts of the US and see how they perform and put money into to keep them alive. At the end of days, it’s still the same old game that the EUR is too big to fail as the $ is. It can dip, but that happens to all currencies over a time.
My advice, shop around and spread the money go for value and don’t commit to long term. Show the bank who is the real money owner (you) and get the best deals for you.

shnaek said:

I thought it was everything under 100k?

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It does not matter if the sum of money is 50,000 EUR or 500,000 EUR or 5,000,000 EUR.

All sums of money, regardless of the amount, are state guaranteed in the Irish banks, like most of their liabilities.

the-madman said:

The EUR is still one of the strongest currencies simply because it’s backed by the diversity of all its member states. While the £ for example can easily go south once something “weird” happens in London only.

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so can the EURO -it has tanked a number of times in the past few years...first on greece, then ireland, then portugal, then spain, then italy

whil the diversity of Eur member states is all well and good in the good times, it can also work against the currency in the crazy times (ie now).

the main mitigating factor for keep your savings in EUR is that (at present) EUR is the currency in Ireland. Moving savings to another currency then puts a currency risk in place (which people dont really need right now). The reason people are suggesting moving money out of Ireland is that if Ireland were to leave the EUR, then a new currency (say Punts) would be introduced in Ireland. This currency would (in all likelyhood) quickly devalue vs EUR...meaning that the value of your savings would be diminished (vs its value in EUR). There is uncertainty as to what would happen with debts owed in EUR -would they stay in EUR or convert to Punts. My guess is that if they convert savings to punts then debts would also have to convert.

What does this mean for u & me? Well if you have your savings in Ireland and these convert to punts & your debts convert to punts, then the only difference is that imports (and holidays) are then more expensive. But if you've moved your savings to another EUR country, then you would gain on the currency devaluation - your EUR would now buy more punts. so as long as your debts convert to punts you would be quids in!! But all this is IF Ireland left the EURZONE. Moving your savings to any other currency is then just currency speculation -something most people dont need