Building society share a/c - covered by deposit protection?

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camlin90

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Does anyone know if building society share accounts in places like Irish Nationwide and EBS are covered by the deposit protection scheme?

I have read the INBS brochure which states that "deposits making up the own funds or capital of the institution" are not covered by the scheme.
If share accounts fall into this category, then most of the building societies' savings products would not be covered, including their fixed term savings bonds.

Anyone have a definitive answer?

Thanks
 
I would assume all consumer deposit accounts are covered, even member/share accounts, otherwise the scheme is pointless.

I guess IN's smallprint is based on [broken link removed]
Deposits not eligible for cover include: items which make up the own funds or capital of the institution;
Click to expand...

I think this is to prevent the institution depositing its own funds with itself, perhaps through proxies. I don't think it's designed to exclude consumer deposits from cover. I could be wrong!
 
There must be some organisation where a definite answer to this can be got.

Anyone know ?
 
Deposit Guarantee Scheme regulations defines share accounts in building societies as deposits falling to be guaranteed under its regulations other than shares that fall within the definition of own funds in Article 2 of Council Directive no. 89/299/EEC of 17th April 1989 see below:

Article 2 General principles [broken link removed]
1. Subject to the limits imposed in Article 6, the unconsolidated own funds of credit institutions shall consist of the following items:
(1) capital within the meaning of Article 22 of Directive 86/635/EEC, in so far as it has been paid up, plus share premium accounts but excluding cumulative preferential shares;
(2) reserves within the meaning of Article 23 of Directive 86/635/EEC and profits and losses brought forward as a result of the application of the final profit or loss. The Member States may permit inclusion of interim profits before a formal decision has been taken only if these profits have been verified by persons responsible for the auditing of the accounts and if it is proved to the satisfaction of the competent authorities that the amount thereof has been evaluated in accordance with the principles set out in Directive 86/635/EEC and is net of any foreseeable charge or dividend;
(3) revaluation reserves within the meaning of Article 33 of Council Directive 78/660/EEC of 25 July 1978 based on Article 54 (3) (g) of the Treaty on the annual accounts of certain types of companies (9), as last amended by Directive 84/569/EEC (10);
(4) funds for general banking risks within the meaning of Article 38 of Directive 86/635/EEC;
(5) value adjustments within the meaning of Article 37 (2) of Directive 86/635/EEC; (6) other items within the meaning of Article 3;
(7) the commitments of the members of credit institutions set up as cooperative societies and the joint and several commitments of the borrowers of certain institutions organized as funds, as referred to in Article 4 (1);
(8) fixed-term cumulative preferential shares and subordinated loan capital as referred to in Article 4 (3).

Hope this answers the question.
 
Thanks Kaplan.

Also INBS confirmed that all share accounts are covered under the Deposit Protection.
 
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