Written question asked by Lord Laird (Ulster Unionist Party), in the House of Lords. It was answered by Lord Sassoon (Conservative) on Tuesday, 26 April 2011.

Banking: Iceland

Question: To ask Her Majesty’s Government, further to the Written Answer by Lord Sassoon on 28 March (WA 208), why 153 depositors with failed Icelandic banks have not reclaimed £418,200,202; and whether they will cease refunding balances over £50,000 in those banks and instruct the Financial Services Compensation Scheme to cease any further payments.

Answer: The figure of £418,200,202 includes all cases, as of 4 January 2011, where it has not been possible to locate the investor; no response has been received to enquiries; the depositor has gone away without leaving a forwarding address; or claimants have realised mistakenly that they are not eligible to claim under Financial Services Compensation Scheme (FSCS) rules. Payment for compensation for amounts up to £50,000 is a matter for the FSCS. Under the rules covering FSCS payouts, the FSCS will continue to pay compensation, provided that the relevant bank in question owes a legal liability to its customer. There is currently no deadline for claims against HM Treasury for amounts above £50,000 except in the case of Landsbanki. In this case, depositors were notified by the FSCS in 2009 that claims for compensation for amounts above £50,000 must be submitted by 30 October 2009, the date by which under Icelandic law creditors of Lansdsbanki (including the FSCS and HM Treasury) were required to submit their claims.

Secondary information

Type: Written question
Reference: 8264; 727 c12WA
Session: 2010-12
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Subjects: Compensation Banks Insolvency Iceland Financial Services Compensation Scheme
Link: View this Written question on www.publications.parliament.uk