Interest amount included in our claims.

  • Russell
  • 12/10/08 31/05/09
  • unspecified
  • Offline
Posted: Sat, 09/07/2011 - 12:31

In all the banking rules and regulations it states quite clearly that the interest to be included in a creditors claim is calculated up to the date the bank is put into liquidation . Why in the case of KSF is our interest included only until 08 October the date the bank ceased trading ?.

The SOA delayed the liquidation causing additional hardship to depositors . It was not asked for and not wanted by a big majority of those concerned . It was also financed from our funds . The treasury surely had no right to do this . Not only that but the date of liquidation was still not considered for the inclusion of interest claims . Those were still backdated to 08 October the cease trade date inspite of the dalay and the cost !!!

Our interest should be paid until 27th May 2009 the date of the liquidation . That is what is stated in all the banking rules and regulations quoted concerning the demise of KSF - so how can this be ignored ? The only slight benefit to the delay might have been extra interest accrued in our claims but seems the rules can be bent to suit by the authorities .

I suggest this topic needs to be brought up again and enforced . How can this interest claim be overlooked and dated back to October 2008 when all the rules and regulations state otherwise . ?

The 5% limit on interest is also very unfair but that is clearly stated in the relevant documentation so by my own arguement must be accepted though most of us would not have been banking at KSF for 5% interest at that time - I know I would not . Yet that is the amount we must accept in our claims .

Atleast that 5% however must be up to the date of the liquidation as that is also clearly stated . It really cannot be clearer so why are we being ripped off in this way and how is it allowed to happen ?

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Interest claims

  • anrigaut
  • 19/10/08 30/10/09
  • a depositor
  • Offline
  • Sun, 10/07/2011 - 22:10

I have not personally studied the regulations, so stand to be corrected.

However, for what it's worth, my understanding has always been that, under Manx insolvency laws, claims for interest after the date of default (in our case 9 Oct 2008) can (and will) be considered only if and when the (currently agreed) claims for capital plus uncapitalised interest up to 9 Oct 2008 (capped at 5%) have been paid in full.

This concords with the following statement on the DCS website: "an eligible deposit is made up of the account balance and accrued interest as at the date of filing the winding up petition (Regulations 9(1)) & 9(4)(a)). Accordingly, interest for the purposes of DCS calculations accrues up to 9 October 2008 - this is consistent with the approach of the Liquidator when calculating your entitlement."

My further understanding is that if and when that point (representing "100%" recovery) is in fact reached, then additional interest WILL become payable, first any uncapitalised interest at 8 Oct over and above the 5% cap and then, if funds allow, interest relating to the period up to the date of liquidation (not sure how this would be calculated - it may for instance be different for those who had fixed term accounts at supposedly guaranteed rates of interest, but it seems premature to begoing into such details at this point). Interest has been included in the amount claimed under the Parental Guarantee, so may eventually be taken into account even if KSFIOM recovery does not reach 100% of currently-agreed claims.

In practical terms I don't see that this will make a significant difference to our final payouts (except that the % recovery will appear to be higher under this system than it would if all interest was included in the initial claim). But maybe I'm missing something.


Interest

  • Russell
  • 12/10/08 31/05/09
  • unspecified
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  • Wed, 13/07/2011 - 10:48

I believe that our initial claims should have been calculated with interest to liquidation date . However if there will be any intention either by the PG or from the Liquidator to pay interest to 27 May 2009 should funds be available as you suggest that is a better situation than I was aware of . I have never seen a reference to it . I did know that interest over the 5% cap to 08 October 2008 would be paid should funding allow after initial claim payment but have never seen anything concerning additional interest after 08 Oct 2008 up to liquidation date 27 May 2009 . Hopefully if correct we may yet actually see a benefit for some to the SOA and the delay of the liquidation date . Who would have thought that possible !! Seriously though the Liquidation should have happened straight away to avoid all the additional hardship suffered .


@Russell

  • IceCrusher
  • 14/10/08 25/10/11
  • a depositor
  • Offline
  • Sat, 09/07/2011 - 18:58
  1. IoM Judiciary
  2. IoM Judiciary is essentially the final arbiter for small concerns.

Ice