What happens savings in a banking melt down?

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groom

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Hi,
if some bank(s) in the state collapse - are my savings held in various current/deposit/regular savers accounts under threat. Is there any garantee that the government will or can step in in a similar situation to Northern Rock in the UK?
 
No guarantee whatsoever! You lose your money .

Except for 90% of the first €20,000 which is covered under an agreed protection scheme. This increases to €40,000 for a joint account.

Some of the foreign banks eg Rabo have much better protection schemes
 
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(Slight) Correction - you get 90% of your balance, subject to a maximum compensation payment of €20,000. So ideally you should have no more than €22,222 on deposit at any Irish bank.

Note that if you have several accounts with the same bank, they are all added together for the purposes of determining compensation.

Regarding joint accounts, it appears that if you have a joint account and an account in your own name with the same institution, they will add the balance of the sole account to half the balance of the joint account when calculating the compo.

Some unanswered questions from that document:
- what happens if more than one bank defaults - can you only claim once?
- what happens if more than one subsidiary of the same group defaults - presumably balances with the different subsidiaries are added together

Of course, bank defaults would be viewed as highly unlikely by most people... despite what some newspapers may report... ;)
Having said that, nothing is beyond the bounds of possibility in the current market climate... and some institutions may have higher risk profiles than others.
Diversification is definitely something to bear in mind, but personally I haven't got around to it yet! :(
 
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