Could Britain 'Do A Cyprus' ?

Mendonca In Asdas

Do you think the same thing could / would happen here , people having bank accounts frozen , money taken out of peoples accounts to sort out the deficit?

I wouldn't put it past the politicians , our finances seem to be up the swanny , just a question of when i guess?

Brendan_O_Connell

It will happen in Spain very soon I think. Hopefully it won't get to that point here, but you never know.

Henry Irving

Who can say for sure what will happen a few years down the road but I would say no on the basis that:

We're not in the Euro

We're not a money laundering offshore banking business for dodgy Russian investors

We're just too big a country to be bullied that way that Cyprus has.

Jarman

If it happened in Britain then who would bail everyone else out?

randy andy

Also, whilst a lot is made of double/tripple dip recession, that is over the country as a whole. London and most of the SE has seen it's economy grow 12.5% since 2007. So whilst the country as a whole is suffering, the financial heart is still beating strongly.

The problem Spain has got, and Cyprus even more so, is a massive amount of their national income is from tourism, and northern Europeans just aren't spending.

Henry Irving

Jarman said:

If it happened in Britain then who would bail everyone else out?

Germany : - )

Bedsaddick

They can freeze my overdraft if they like.

northstandsteve

randy andy said:

Also, whilst a lot is made of double/tripple dip recession, that is over the country as a whole. London and most of the SE has seen it's economy grow 12.5% since 2007. So whilst the country as a whole is suffering, the financial heart is still beating strongly.

The problem Spain has got, and Cyprus even more so, is a massive amount of their national income is from tourism, and northern Europeans just aren't spending.

if only my business had grown

The_President

A financial 'expert' in one of the big papers over the weekend stated that he believes we are 3rd or 4th in line for similar treatment, sooner rather than later . I was trying to think who the other 3 would be, and i suppose its the PIGS again,

randy andy

Well I'm just quoting this article on the BBC:
http://www.bbc.co.uk/news/business-21934564

I don't think we're in any danger of doing a Cyprus in the near future, but you never know what the future holds.

PL54

If we do it will have been Thatcher's fault (of course)

Weegie Addick

I'd like to know what happens to companies that hold customers' money as advance payment for goods/ services? For example, we run a holiday business, so take deposits and balance payments from customers before they take their holidays. So around this time of year, we have a healthy bank balance - but the majority of that is advance payment for costs that will be incurred once the holidays are taken. If the Gov came along and took 20% or more of it, that would wipe out our business. Do they make any attempt to distinguish between cashflow and actual reserves?!

Jarman

Henry Irving said:

Jarman said:

If it happened in Britain then who would bail everyone else out?

Germany

Ben I will quote your fine self from an earlier post if I may.

but you just know there will be the usual people being serious

Serious , you say...
How apt, eh?!

Henry Irving

Jarman said:

Henry Irving said:

Jarman said:

If it happened in Britain then who would bail everyone else out?

Germany

Ben I will quote your fine self from an earlier post if I may.

but you just know there will be the usual people being serious

Serious , you say...
How apt, eh?!

Whoooooooooooosh : - )

Algarveaddick

If it happens, their will be plenty of time for the super rich to shift what they still have in the country into their offshore accounts.

The Red Robin

Only a matter of time before it happens here I'd say. Maybe not this year but it's coming.

eaststandmike

Algarveaddick said:

If it happens, their will be plenty of time for the super rich to shift what they still have in the country into their offshore accounts.

Phew! thank god for that. :-)

Algarveaddick

eaststandmike said:

Algarveaddick said:

If it happens, their will be plenty of time for the super rich to shift what they still have in the country into their offshore accounts.

Phew! thank god for that. :-)

:-D

cafcfan

Whatever. In any event - and I know this will effect a lot of people on here :-) never, never, ever keep all your eggs in one basket. Certainly never more than £85k on deposit with any one banking group. That's the limit for compensation in the FSCS. You need also to be aware of what your bank's "trading names" really mean.
For example, the Lloyds Banking Group uses the trading styles Lloyds TSB, Halifax, Bank Of Scotland and C&G (Is the latter mortgages only?). Together with the investment houses, Clerical Medical and Scottish Widows. (There are different levels of compensation payable by the FSCS for investment and insurance business defaults.)

Goonerhater

100K in euros aint super rich

cafcfan

Weegie Addick said:

I'd like to know what happens to companies that hold customers' money as advance payment for goods/ services? For example, we run a holiday business, so take deposits and balance payments from customers before they take their holidays. So around this time of year, we have a healthy bank balance - but the majority of that is advance payment for costs that will be incurred once the holidays are taken. If the Gov came along and took 20% or more of it, that would wipe out our business. Do they make any attempt to distinguish between cashflow and actual reserves?!

Only individuals and small businesses really have any protection at all in the event of a bank defaulting. The protection regime is generally (there are exceptions) in place to protect retail consumers.
These days it would be quite unusual, and dangerous I'd have thought, to mingle company's funds with customers' monies. Remember Farepak Hampers? Their big rivals Park Hampers put clients' funds into a trust account and are still going strong.
Surely the correct thing to do would be to hold those advance payments separately in some form of escrow or client money account until such time as the money becomes payable to the supplier companies? It might then be covered but you need to ask your bankers or the FSCS for their considered opinion. fscs.org.uk/

Greenster

Goonerhater said:

100K in euros aint super rich

Thats the minimum threshold. If you add up total deposits it is total unbalanced with the rest of Europe & the "super rich" have way more than EUR 100k!!

E_cafc

So if you have 99,999 euros in Bank of Cyprus you lose nothing but if you have 100,001 you pay up to 40% in a theft levy! What dickbreath at the European Union thought that one up?

MuttleyCAFC

Could be the life savings for a pensioner couple. Ultimately, it will have repurcussions througout Europe as people lose the trust they have in banks.

ShootersHillGuru

Hypothetical question I hope. So it happens here. What are the implications for your average joe ? Short and long term.

E_cafc

MuttleyCAFC said:

Could be the life savings for a pensioner couple. Ultimately, it will have repurcussions througout Europe as people lose the trust they have in banks.

Exactly, who is going to invest anything in the eurozone now? You would have to be stupid to do so. The money will be flying out of the place(if they allow withdrawals and transfers of people`s own personal private money)

Henry Irving

The positive spin being put on it yesterday was that investors unsure about the banks would look to alternatives such as the stock market leading to an increase in share prices.

cafcfan

E-cafc said:

So if you have 99,999 euros in Bank of Cyprus you lose nothing but if you have 100,001 you pay up to 40% in a theft levy! What dickbreath at the European Union thought that one up?

I must say I have to agree. I have no idea how house purchases work in Cyprus, but what is going to happen to people who had a contract to buy a house and had the money in their bank account short-term pending the purchase? Are they going to lose their money but still be contractually obliged to complete on the house sale?

redman

It is of course happening herein small measures. Inflation at 4% interest at maybe 1.5% net of tax and you are effectively losng 2.5% per annum. This has happened for several years in the last 40 years and is very likely to continue for the next 5. Very difficult to inflatuion proof savings without taking risk

I think it very unlikely in the forseeable future we will do a Cyrpus though

Lincsaddick

It will not happen in Britain as any government introducing such a measure would not get back in power ever, that is if the PM and his cohorts managed to avoided assassination and/or public hanging.
The Cyprus situation is an example of Germany showing its muscle, Euros not Panzers thankfully. But of course Cyprus is a tiny nation which has lived above its means for years like the rest of the southern European EEC states. All the lotuses have been eaten my Cypriot friends, get off the beach, out of the café and start working hard for a living for a change

grownupyth

No sterling will save us. No thanks to New Labour though. Having the Euro was nearly another catastrophic fvck up on par with selling our Gold @ $255!