350 mln Offer From IOM ! What does that mean for us?
From Today's Scotland Herald.
Link also posted on News tab:http://www.theherald.co.uk/business/news/display.var.2474155.0.Kaupthing_savers_will_be_offered_350m_package.php
WHAT DOES IT MEAN FOR US?
Kaupthing savers will be offered £350m package
SIMON BAIN December 10 2008
Depositors and bondholders in the collapsed Kaupthing Singer & Friedlander Isle of Man bank are to be offered a £350m compensation package by the island's government and banks, it was reported yesterday.
More than 8000 savers and investors, mainly British, stand to lose £800m in the liquidation of the Icelandic offshore bank, which has been twice postponed to enable talks about some form of rescue.
The report said the package would use government and bank contributions to enhance the island's existing compensation scheme, and add to any available assets from the provisional liquidation of the company. The government's maximum contribution would be £150m and that of the banks £200m. A similar scheme in Guernsey has been funded with £100m.
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The IoM government said it was working with the provisional liquidator to achieve the "best possible outcome" for depositors, and expected an indicative value of the bank's assets to be announced in mid-January.
An insurance industry spokesman said all depositors, including life insurance company policyholders, could expect to do "significantly better" from the rescue package.
The IoM government is also understood to be planning to provide immediate emergency pay-outs of around £1000 to help small depositors in cases of hardship
350m "compensation" addition to IOM offer
This story is gaining ground. I doubt it is true. I think the IOM Government (Treasury Minister Bell) or the Chief Minister Brown should squash it - or confirm that it is under consideration. They should NOT allow it to gather momentum if it is pure journalist speculation. Can somebody on the island please contact IOM responsible staff and ask for comment or denial.
If it continues the rounds it will damage our case, unless it is true.
Someting similar regarding compensation
"Meanwhile, there appears to be a silver lining for those with deposits in collapsed Manx subsidiary Kaupthing Singer and Friedlander with the news that the IoM’s government is to team up with local banks to offer investors strengthened compensation.
The package, which will help all KSF IoM depositors, will combine government and bank contributions under a depositor compensation scheme with assets from the provisional liquidation of the company."
Here's the link but its in news items too:
http://www.moneymarketing.co.uk/cgi-bin/item.cgi?id=178066&d=340&h=341&f...
To be quite honest I think
To be quite honest I think that either these reports are either a load of c**p with one journalist picking up on all the information that has been in the public domain for weeks and then mixing it all up to produce an 'original' story that has then been picked up by a load of other lazy journalists.
Or a concerted spin campaign by the IOM authorities and banks to set expectations on what could be expected.
To be quite frank, this is old news.
Money Marketing Article - Bondholder compensation
I have sent the following to the Editor of the journal which produced the first 'Compensation' story -
One of your team, Hannah, wrote an interesting article on the current Kaupthing IoM crisis yesterday, entitled:
IoM government seeks to support bondholders with compensation package
Have a couple of questions regarding that article:
What is the Compensation Package for Bondholders to which Hannah refers please? The only compensation scheme of which I'm aware is the DCS scheme (which, as she says combines Iom Govt and Bank contributions to a max of £150m). However if the bank goes into liquidation and the DCS scheme is triggered then Bondholders will be treated as one single depositor. In the case of Royal Skandia bondholders, this means 600-700 of us sharing €20.000! Is Hannah saying that the rules of the DCS have now changed to treat all Bondholders as individuals under the DCS? Clearly, whatever the Liquidator recovers (separate from the DCS) will be shared equally amongst Bondholders and direct depositors but this can hardly be considered as compensation and is anyway not specific to Bondholders.
In the case that liquidation is avoided, the only alternative seems to be the 'Orderly Run Down'? Is any compensation scheme being offered by anyone in such an event? So far, I have seen no reference to anyone offering any compensation beyond that which the Liquidator recovers. Is there a suggestion that IoM will divert some part or all of what it would have given to fund the DCS scheme?
You will appreciate the importance of Hannah's article to myself, my family and the thousands of investors who are anxiously scanning the media for news. We stand to lose our life savings. The suffering for us and many like us over the past 8 weeks has been immense. The medical, financial and emotional consequences of this event are already very significant and you can read more about this on the Depositors' website. I sincerely hope and pray that there is a Compensation Package for Bondholders and that we have now some hope of an improved settlement versus what the Liquidator recovers or what is retrieved during the Orderly Run Down. Unfortunately, the article is somewhat vague in key areas but I trust that your journal's source, research and conclusions are impeccable given the circumstances and the audience.
Would be grateful for the clarifications as soon as posible.
Thank you,
old news
Yes this is basically old "news" and has already been discussed in this thread:
"Has anyone else seen that IOM is compensating bondholders"
Journalists Filing Retreads? Say it ain't so, Joe.
Some might wager that when the weather is chilly in Glasgow, good journalistic hacks will seek the warmth of a cosy alcove and knock off half a dozen retreads -- but I couldn't possibly comment. In my day, we used to update the obits of the soon to be departed or 'fly a kite' targeted at outraging the unsual suspects who would complain to the editor about anything -- I recall one about the council failing to take adequate measures to deal with an unusually heavy fall of Autumn leaves. Still, without the irate Colonel Bloodshots of this world, where would the press be today?