Tweet
The Anglo Irish Bank today moved to reassure its UK savers that their money is entirely safe after the bank was dramatically nationalised last night by the Irish government.
It is thought 120,000 UK-based savers have a total of around £10bn invested in the Dublin-based bank.
British savers poured money into its coffers late last year after the Irish government promised to guarantee 100% of all deposits held in Irish banks.
They were also attracted by some of the highest interest rates in the UK market - particularly for its one-year and two-year fixed rate savings bonds which remain near the top of the savings tables.
Ireland's Fianna Fail-led coalition government said the bank would "be managed on an arms-length basis as a commercial entity" and that shareholders's rights would be respected.
"All customers of Anglo Irish Bank can be assured that the full amount of their deposits and savings are further safeguarded by this action.
"They can also be assured that they can and should continue transacting with Anglo as normal and there is no need for customers to take any steps as a result of this announcement. Anglo Irish Bank will communicate directly with all customers in the coming days," the Irish finance minister, Brian Lenihan, said last night.
This morning, a notice appeared on the company's UK website designed to reassure savers that they continue to have access to their money, and that future payments are fully safeguarded.
The company said terms and conditions were unaffected, and that promised interest would be paid as before.
Anglo Irish's one year fixed-rate bond paying 4.6% remains second in the table of best buys - and is understood to have been doing brisk business in recent months, helped substantially by the collapse in the rates offered by the UK banks following the recent base rate changes.
Kevin Mountford, head of banking at moneysupermarket.com, said: "The nationalisation shows that, after the financial bloodbath that was 2008, there is still worse to come.
"Naturally any savers with Anglo Irish may be concerned about the safety of their money but it's worth noting that the government guarantee means their deposits are fully protected."
The declining fortunes of the Anglo Irish Bank, which had a reputation for funding key players in the Irish construction business, can be tracked via its share price.
In 2007 shares in Anglo-Irish Bank were worth €17 (£15) but when trading stopped yesterday they were priced at only 22 cents.
guardian.co.uk © Guardian News & Media Limited 2009 | Use of this content is subject to our Terms & Conditions | More Feeds
More...
