VERY IMPORTANT UPDATE - PLEASE READ

  • Diver
  • 11/10/08 31/05/09
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Posted: Thu, 25/12/2008 - 02:24

DAG Representative Committee

In his correspondence of November 19th to other parties involved in this debacle (in particular Cains and Gough & Co.), John Wright, the DAG Advocate in the Isle of Man, requested an informal committee of creditors be assembled with the objective of liaising directly with PWC and the IOM Government with regard to proposals and strategies for KSFIOM. As a result of this and the immense efforts of depositors this request has been granted.

As you all know, Alix & Partners were appointed by the IoM government to identify and develop restructuring plans for the bank as well as to carry out due diligence on the assets of KSFIOM to identify their liquidity and current market value. Over the past few weeks they have been working alongside the IoM Treasury and exploring a number of options for our bank. John Spellman, Director of the Financial Services Division for the IoM Treasury has been in discussions with a number of depositor representatives over the past weeks and has agreed to the formation of a committee of depositors which the IOM Government will use as a sounding board for all proposals for the future of the bank and our deposits.

The committee has been carefully put together to represent the demographics of the DAG as best as possible and includes the following members:

Higher Value Depositors: DaveBraddan, Ally and Diver
Core Depositors (under 50k): Willumcat and Emabroad
Small Business: Nixi
Bonds/Investments: Teapot
In-Transit Funds: Sleeplessnight

In the next week this committee will receive a selection of proposals for the future of KSFIOM and a conference call will take place to discuss this information. In the court hearings on the 14th and 29th of January, the IoM government will outline all these proposals and announce which have been rejected and which are being looked into further based on the responses of the committee.

It is important to note that the committee WILL NOT HAVE AUTHORITY to make a final decision on the fate of the bank on behalf of all depositors. When a solution has been devised that the committee believes is in the best interests of ALL (and there will have to be compromises on all sides), it will be put to a vote of ALL depositors with the results of this vote being presented to the court. Only then will the court make a decision on whether or not to proceed with the suggested plan.

Due to the commercial sensitivity of the discussions the committee will be having with the IoM Government, there will be some things which cannot be broadcast to the DAG as a whole. The committee will, of course, report back with as much information as possible, but would ask for the DAG’s trust and support to pursue the objective of the return of 100% of depositors’ money.

Further Strategy & Actions

As always our objective is to recover 100% of our money at the earliest opportunity, recognising hardship and long term difficulties that arise from our varied situations. At present our strategies are as follows:

• the unofficial committee will receive and review the proposals of IOMG
• formalizing the DAG - a constitution is currently being drafted and is nearly complete and will be uploaded for consultation
• continue to explore legal avenues and to continue investigating the culpability of various parties in our situation with the aim of seeking recompense where appropriate
• ongoing press releases based on developments and human stories - these are uploaded to the public site and an explanation of distribution can be found there
• building on existing political network of sympathetic and active MP's and representatives
• lobbying of UK MP's to push HMG to act decently with regard to: it's actions to date, clause 27 si2674, representation for IOM to Iceland and the recompense of the depositors of KSFIOM
• lobbying Iceland to honour the parental guarantee given to us by KHf.

This is a very significant step for all of us and it brings us closer to understanding our situation and what is being done to achieve the best possible outcome for all.

I think it is important to recognise EVERYBODY’s efforts in bringing about this progress as you’ve all contributed to this in one way or another. By supporting the legal routes both in the UK and the IoM and by keeping up the pressure on politicians on all sides of this mess we have now achieved one of our major goals in getting a serious official dialogue going with the IoM authorities.

It should be noted that special thanks for getting all of this sorted out should go to Sleepless, Dave, Teapot & Ally who have worked tirelessly behind he scenes to help make all this happen. Sorry if I've missed anyone out but if I have...thank you too!

Thank you all for all your magnificent efforts and your support and understanding over the past months. I hope that this news brings a little bit of cheer to an otherwise sombre holiday season. Please try to have as merry a Christmas as possible and let’s hope the New Year brings us all much happier times.

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Voting............. Ally, please

  • Anonymous
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  • Fri, 02/01/2009 - 18:13

Ally could you please help with another of your very helpful and accurate posts.....

Diver's message...

"It is important to note that the committee WILL NOT HAVE AUTHORITY to make a final decision on the fate of the bank on behalf of all depositors. When a solution has been devised that the committee believes is in the best interests of ALL (and there will have to be compromises on all sides), it will be put to a vote of ALL depositors with the results of this vote being presented to the court. Only then will the court make a decision on whether or not to proceed with the suggested plan."

Whilst there is the predictable (seasonal) lull in protagonists' developments it'd be very helpful to learn more about the mechanics of the vote that Diver proposes.

eg who would mail the forms etc to all 8,000 depositors ?
eg presumably the voting would not be weighted in any manner ?

Would be a good idea to get more on this before the January meetings etc.

Many Thanks


Voting

  • Ally
  • 13/10/08 31/05/09
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  • Fri, 02/01/2009 - 19:08

Bobby

In term of mechanics of voting I have no idea at all. The geographical spread of depositors would lead you to believe voting would need to take place over a number of weeks. So I really don't know if this can be achieved before the 29th January.

As to the actual vote I believe it will be double layered. So there must be a majority by value and a majority by number. Nothing has been finalised, but I believe the majority by value has to be at a higher level than a simple majority, lets say 75% for example.

So for any scheme to pass it would need 75% by value and 50% by number to agree. So if the insurance companies and biggest depositors voted for something, you may have 80% by value but lets say only 2,000 votes. Lets say smaller depositors voted agianst, so lets say 4,000 votes then the scheme would fail.


Voting

  • Anonymous
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  • Fri, 02/01/2009 - 20:02

Thanks Ally,

I think it's probaby just me who's confused !

I thought the voting HERE applied to just each of the 8,000 (or whatever number) retail depositors, and not other creditors (of the Bank, like eg Insurance companies).

Are you saying that voting would be per "group" , and eg "block voting"? Sounds ominous.

When I placed my deposit I was aware of the DCS summary and the parental guarantee bit (in the event of a failure) but I did not realise that the size of my deposit would be considered like shares or units, and that I would effectively get more votes than somebody who deposited less than me, and fewer votes than somebody who deposited more than me. Doesn't sound too fair to me, but no doubt somebody'll be able to reassure me.

Exactly who's to decide any weighting and grouping, and when ?


Voting

  • Ally
  • 13/10/08 31/05/09
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  • Fri, 02/01/2009 - 22:32

Bobby

In administration law the size of the debt always matters. So in a normal administration if you are a small creditor and there were 2 or 3 big creditors holding say 70 - 80% of the debt you basically end up with no say.

I think here the IoM want to balance up the voting.

So the insurance companies would have 1 vote the same as any other depositor on one level of voting. Then on the second level they might speak for £50m of depositors whereas an indvidual depositor might only speak for say £20k.

If this is the final voting plan, then the smaller depositors would still be able to vote down a scheme as although they wouldn't have a majority by value, they would have a majority by number of votes cast.


voting by depositors

  • Anonymous
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  • Sat, 03/01/2009 - 15:17

Since the bank has not yet been wound up, I am not sure why insolvency rules for voting by depositors need be strictly applied or even applied at all in respect of this exercise, which it seems to me is nothing more than a means by which the IOM Treasury will seek to persuade the court that the bank should not be wound up and that the DCS should not be triggered. The informal committee has no legal standing and a vote by the depositors would have no legal significance in advance of winding up (but it might be enough to persuade the IOM court).

In any event, it is rather alarming that the committee does not yet know how voting will take place, when it appears that the exercise needs to be completed before the Treasury drafts its next affidavit for the court (by Jan 15). Or will the Treasury merely seek to rely on the committee's agreement to whatever proposal in makes, as there will not by then be sufficient time for a vote of depositors on even one such recommended proposal? Further, I repeat my earlier point that depositors will only be given the opportunity to vote on proposals that are recommended by the committee, rather than all such proposals, and I believe that is flawed.


Elgee

  • cottesmore
  • 21/10/08 16/07/12
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  • Sat, 03/01/2009 - 15:46

Isn't it about time you and a few others declared openly that you want DCS triggered? You no more care about us >50k than flying to the moon! All this 'clap trap' and 'hidden' comments you post, point to exactly that.Tell your fellow supporters the truth,if DCS is triggered,some of them wont live long enough to get a penny of it!


cottesmore scaremongering

  • Anonymous
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  • Mon, 05/01/2009 - 05:38

"wont live long enough to get a penny of it!"
Prove it. This is a very pessimistic and negative criticism.
I assume that the proceeds of any winding up will transfer to the manager of the DCS. This may cover everybody up to 50k and we may receive payment very soon.

You are getting at elgee. He has presented a matter of importance to those of us with under 50k. Why not address the comments made rather than attack the person raising the comments? Responses like yours are beginning to make me wonder if I might be missing something. Am I? Or is discussing the DCS taboo? I am sure that over50k depositors will not seek advantage at the disadvantage of the under50k depositors. Still, larger depositors could assuage the fears of the under 50k depositors with positive remarks of reassurance, rather than criticising.

I deposited my money on the IoM because of proximity to the UK, the DCS and the parental guarantee - in that order. I want all of my money back. I can receive all of my money back under the DCS. I want to read about/discuss the DCS and matters pertaining to it.


Not so fast - the proceeds of

  • Captain Mainwaring
  • 11/10/08 31/05/09
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  • Mon, 05/01/2009 - 08:38

Not so fast - the proceeds of any winding up will only be transfered to the DCS from the dividends payable to depositors who agree to be a "member" of the DCS.

At the moment there is nothing that encourages me to subscribe to the scheme - I will get nothing out of it (as you know, the DCS does not treat all depositors fairly).

As for anyone addressing comments made by elgee - he has set everyone off against each other but still it seems he doesn't really understand the workings of the DCS - I for one am waiting for him to explain to me just how it does work before any more arguments break out on the strength of this advice.


DCS

  • user1123
  • 14/10/08 31/05/09
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  • Mon, 05/01/2009 - 08:52

something that should be mentioned is that the new DCS had not gone through tynwald when the doors of the bank were closed. Understand that one of the considerations is to show at law that there is in fact NO >50 in this case, think you will find that it could be >15, so be very careful those of you who are putting yourselves in boxes at this stage.
The trigger for this move was the expected demise of another bank on the island which has not materialised at yet but might.


Ramsey Peel

  • Captain Mainwaring
  • 11/10/08 31/05/09
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  • Mon, 05/01/2009 - 09:10

And I'll take a guess that the IoM are so insistent on finding a solution because their Actuary took a look at the grouping and levels of deposits and realised that there would be a huge hit on the scheme because of the levels of smaller deposits.

It's worth remembering again that the worse case for the DCS is not 3 depositors with £1 million a piece in the pot and a 10P in the pound recovery, but 300 depositors with 10K in the pot, which having looked at the latest figures from the IoM is very likely.

The first scenario costs the DCS nothing whereas the second scenario costs the DCS £2.7 M - I think that when the numbers are revealed, the DCS if activated will be seen to take a huge hit.


Ramsey Peel

  • user1123
  • 14/10/08 31/05/09
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  • Mon, 05/01/2009 - 09:22

you need to understand the motivation for the rise from 15 to 50. It was not to keep investors happy, or promote the Iom as a "reasonable" jurisdiction. It was because there are several MHK's with money in there, in excess of 15 and they want it back. However if they, the MHK's, stand to get more back by not activating the DCS, that is the route that will be taken.
Mainwaring, am aware of who you are and you know the score.


show compassion

  • hippychickrobbed
  • 03/11/08 31/05/09
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  • Mon, 05/01/2009 - 07:39

Can you please show compassion to people who have lost everything or proceeds like myself of a house sale, its very distressing. Like cottesmore said the dcs was raised from 15k I beleive to 50k, it is lady luck for you. What about bondholders who were told they were mostly protected in their bonds ?. may i add I had my funds in there for one day , havent had any intrest , or a proper account yet expect people to understand the need to at least stick togeter in a crisis which we have all been put in.


hippychickrobbed

  • cottesmore
  • 21/10/08 16/07/12
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  • Mon, 05/01/2009 - 07:50

Exactly!

Sorry,the DCS was raised from 15k to 50k, not 20k, as i have posted elsewhere.


steenjp

  • cottesmore
  • 21/10/08 16/07/12
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  • Mon, 05/01/2009 - 06:52

It is a credit to you that you had the fore thought to see that the IOM Gov' would increase the DCS from 20k to 50k after all this started.Or was that lady luck? Very easy to say, how informed you are after the event.I wonder, if the original figure had of been in place, you would be so keen for DCS? Mind you,i guess the parental guarantee would come to the rescue! Oh,hold on a second,why dont we all go and enforce this guarantee.Oh buggar,i forgot, no one can make Iceland honour it at present! Which would mean years of legal effort and waiting.In those years we all get old and..................
As for elgee and my 'attacking,' I and others, have, on many occassions asked for him to also substantiate his comments/critisms.Nothing yet! Other than cotinual reminders,he is part of the core group.If that it the case,surely the <50k feel well represented?
Are you missing something? who knows? I was not aware you had, 'lost anything!' Tell us what you have lost and i will endevour to help you find it!
DCS is most certainly not, a 'taboo.' It is one of a number of points being discussed (i'm sure) by our core team committee.It has also been a very well covered topic on the forum.(and still is)
I am glad you at least recognise that,'the >50k will not seek to take advantage at the disadvantage of <50k'
I am also pleased to see that you want all your money back.I am however,not convinced you feel the same for the majority of others!


Cottesmore

  • Anonymous
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  • Mon, 05/01/2009 - 07:11

I suspect that your postings are not only irritating smaller savers but embarrassing larger depositers too.

Your pathetic taunting of smaller savers (and not only this past week) is contributing to reducing the energy and momentum of the efforts of ALL depositors.

Do you wish for smaller savers to disappear and form their own Action ?


bs

  • cottesmore
  • 21/10/08 16/07/12
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  • Mon, 05/01/2009 - 07:45

What is pathetic, is your lack of compassion for the majority and the democratic constitution that represents.
Go and re-read some of the comments from some of my other postings.In particular, the Nationalisation of the bank.I fear there is more support for my thoughts than yours.However,i don't see it as a competition.
Do i want to see smaller savers disappear? Yes i do,but along with everybody else!
I will continue to post,along with others,whenever i like.I certainly do not feel that i am reducing the energy and momentum of all depositors.To the contrary, it has highlighted a number of issues.But that's what a forum is for! Or is it, just your god given right to voice your WILL on us all?


PLEASE STOP

  • anrigaut
  • 19/10/08 30/10/09
  • a depositor
  • Online Now
  • Mon, 05/01/2009 - 11:53

Please - all of you - STOP this endless and increasingly unpleasant bickering.

By all means discuss the issues - as far as possible supported by facts - but the personal abuse flying round is extremely unpleasant and does no-one any good.

Exasperated ...


Hear Hear!

  • mikepapa
  • 10/10/08 n/a (free)
  • a depositor
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  • Mon, 05/01/2009 - 18:27

Hear Hear!


etiquette

  • rbirch
  • 13/10/08 31/05/09
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  • Mon, 05/01/2009 - 12:33

well said !!!!
there are some great questions and great comments being made; personal insults don't really help - quite the opposite in fact

we all have different circumstances - amounts of money, need it now/can wait, bonds, Derbyshire etc etc .... we are bound to have different opinions and thoughts - each should be respected.


Yes - stop the bickering

  • Sophie
  • 16/10/08 31/05/09
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  • Mon, 05/01/2009 - 12:07

It does none of us any good, lowers moral, is not constructive and makes myself, and others, wonder who and what we are involved with. As anrigaut states the personal abuse is extreemly unpleasant and helps no one. Least of all yourselves!


sophie,..

  • hippychickrobbed
  • 03/11/08 31/05/09
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  • Mon, 05/01/2009 - 12:24

sophie your right lets stop the bickering, we have all been thrown in this crisis together , but its understandable were all under these important court dates and as time draws nearer we are all on edge.


I agree anrigaut.... come on

  • qatar
  • 15/10/08 31/05/09
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  • Mon, 05/01/2009 - 12:02

I agree anrigaut.... come on folks we have to stick together in this mess..


Very important update

  • German Mike
  • 13/10/08 31/05/09
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  • Sun, 04/01/2009 - 10:49

Hello, cottesmore.

I suppose you would categorise me as one of the non-caring sub 50k members who want the DCS triggered. And in my 71st. year you would add that I won't live to collect under the DCS.

You might be right on the latter, but possibly miles out on the former. And frankly at this stage you simply don't know - you can only take a view, and base what you say and do on that view. If your view differs from mine, you do not expect me to tear strips off you, or demean what you say, or totally rubbish your stance, because this means I am not considering your view in any real way.

And of course, the reverse is true. So please, keep in mind that while I may differ in view, I don't altogether differ in objective, but that I may well differ in terms, and that in one respect at least you are absolutely right - if it comes to an absolute choice of your needs or mine, I make no apology for saying mine will prevail in my mind.

My (simplified) view at present is that I have a right established by recent IoM legislation to full return of our £40k, but without any indication of when that might be. However, as joint depositors, my wife and I take the view that we might not do so badly in the initial payouts under the DCS, relieving much of our current financial discomfort.

My stance is quite clear - by all means seek to find a way in which those with more funds locked up might also be relieved, but if that proposition undermines what I consider to be our position at present in any material way, I will not, indeed cannot, vote in its favour. I mean this in no malicious or uncaring way, but in the final analysis I must, repeat must, act in the best interests of my family.

I worry deeply that the so-called 'representation' may prove to be nothing of the kind, I worry that those of us with relatively small sums are viewed as make-weight in the scheme of things by larger depositors, and I am fearful that the legal right we have at present to full return of our funds may be lost in an attempt to recover everything for everyone.

And yes, of course that causes a division - it has always been there from the day the bank stopped trading and the DCS emerged as a (possible) lifeline. It can be bridged, however, if those that are leading DAG, or supposedly representing us, acknowledge that any material undermining of the present DCS in value or time (however one asseses that!) is avoided in any proposed alternative. I think there is more flexibility on the time issue than on the value issue in this regard.

Of course it is up to individuals whether or not they want to read or consider a differing view, and you may choose to do neither, but try to accept that however differently we may view any final outcome to this affair, I am not uncaring, and wish everyone - even those who get up my nose - well, and a good result.

Mike.


German Mike

  • cottesmore
  • 21/10/08 16/07/12
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  • Sun, 04/01/2009 - 19:34

Hi Mike,
I will not categorise everyone in the DAG.However,i'm afraid there are a few that deserve to be put in some sort of category and its not only in the, 'non caring.'
I appreciate the honesty in your post,it comes through loud and clear.I wish though,some of your fellow group members were as honest too.
I am afraid the divide you write about about is one that has only been created by your own group.I think in hindsight, maybe grouping was not the best way forward for DAG.By virtue of its name,it does tend to indicate one group.Infact, i would honestly say, in my opinion,that i have always believed we were.It is only the last couple of days that this divide has really shown.Yes, there have been a few comments that have made people wonder,i'm sure.But i can honestly write that i (and i am positve,the majority) have felt a united front across all types of depositors.I genuinley believed we were all,in the most,'singing of the same hymn sheet.' That clearly now,is not the case.
I have no hidden agenda to hide behind, or any other reason to get on anyones nerves.But what i will not stand back and allow to happen is, the apparent distrust of the core team/committee.I think without question,so much is owed to them already.I certainly don't need to 'bang on' about what everyone feels about them.That said,i think, it should be understood, that they have always had everybodys best interests at heart.I still believe that now, as do, the many.I also believe, that what ever the outcome, that will always be the case.
Divers update on Xmas eve,it was so warmly welcomed, by so many.It gave a lot of us some great comfort and i understood that within that update it was indicated that some sensitive discussions that were taking place.It also was a fact, that due to that sensitivity, some information would be scarce.(or words to that effect) Now, one of the big criticisms has always been about the lack of information.I think you would agree that we were alerted to this fact.This probably,along with the festivities,has caused some impatience amongst a lot of members.What it should not create though, is a distrust.
Why sir, if you, or others, feel that there is not enough understanding of your situation, has this not been given its own thread.This would have been clear to everyone, how some of the <50k felt.It would also have allowed time to effect the comfort you guys required.I think it unfair to say,we should have joined the <50k, to find out your opinions (as told to me by one of your group members)There has really been enough time to organise.I would also add,if the feeling had been that strong,it would have certainly been actioned.But again,i repeat,the general feeling is, to trust the committeee to act,diligently,honestly and with upmost respect for all.I for one,will support that democratic way,whatever the outcome.
Finally, i do hope we all live long enough to enjoy our hard earnt!


DCS timing

  • rbirch
  • 13/10/08 31/05/09
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  • Sun, 04/01/2009 - 17:16

german mike - your views represent the vast majority of the <50k group - thats a reality.

second, with regard to the DCS timing, please don't accept that there is no timing associated with the DCS payout. in the q&a responses from the IoM govt dated 27th nov 2008 it states that there will be a delay whilst claims are established before payment in full. given that we will have responded to the PWC & IoM govt questions (the later for payment of the gbp 1000) establishing the claims should happen quicker. in other words, once the DCS is triggered, payment could be relatively quickly.

now, the question is - how can we help those with >50k at risk here ? I think there are ways, several ways within the parameters above, that we can help ...... it is a great shame that no-one cares to communicate meaningfully with the <50k group to exchange ideas.


DCS

  • Ally
  • 13/10/08 31/05/09
  • unspecified
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  • Sun, 04/01/2009 - 22:16

This old chsetnut again!

I will declare I am an over £50k so if people want to see me as biased my bias is in the open.

With regard to timings of the DCS. The IoM govt have committed £150m to the DCS, NOT specifically to the problems surrounding KSFIOM.

The £150m has been made available for ALL bank failures that happen within the 12 months from 9th Oct 2008. Therefore it is a possbility (I am not saying for sure it is a fact, but it is definitely a possbility) that they may not be able to commit funds to the DCS in respect of KSFIoM until 9th Oct 2009 as until that date they will not know how many other banks failures they may have to compensate for. Or even if they give the full £150m to the DCS on the 29th Jan the DCS itself may not be able to commit those funds until 9th Oct for the same reason.

Also bear in mind the IoM treasury contribution is for the amount from £20k to £50k. If a deposit is <£20k it will be up to contributions from the banks to fill this. The excerpt from the DCS is below

“Treasury funding

12A. (1) Where a default has occurred the Treasury shall pay to the Scheme Manager such sum as appears to it to represent the total of the amount by which the compensation payable in respect of each depositor exceeds £20,000.

(2) The total sum provided under paragraph (1) in respect of all defaults shall not exceed £150,000,000.”.

It is just my opinion, most definitely not fact , but my opinion is the £150m available to the DCS would not materialise until at least 9th Oct 2009.


ally DCS question

  • rbirch
  • 13/10/08 31/05/09
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  • Mon, 05/01/2009 - 09:03

ally - is your opinion that triggering the DCS would disadvantage the >50k depositors ? if so, can you explain how ?


DCS

  • Ally
  • 13/10/08 31/05/09
  • unspecified
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  • Mon, 05/01/2009 - 11:04

rbirch

It does not necessarily disadvantage the over £50k. I justed wanted to make clear that I am an over £50k so everyone knew whether I was over £50k or under £50k as some people seem to think the over £50k are pushing to avoid the DCS at all costs.

I think there are better solutions than the DCS for both under and over £50k. I think the DCS would not be the speediest way for anyone to get funds back. However I would add I do not want any of these solutions to disadvantage under £50k. I have always thought any shceme put forward by the IoM would not disdavantage sub £50k for the simple reason that it would fail to get passed by the court.

These are just my opinions.


DCS costs

  • rbirch
  • 13/10/08 31/05/09
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  • Mon, 05/01/2009 - 11:59

ok - and to capt m's point below - less money in the pot to redistribute as a result of liquidating than would be the case with restructuring (which also doesn't come cheap !) ... are we sure about that ?

personally I don't care whether my money comes back promptly via DCS or other means, but currently we are paying both PWC and Alix, so the pot is getting smaller day by day. what I do think, is that to continue to pay both beyond January 29th (ie: a further postponement), would be wasteful (to say the least)


DCS Costs

  • Ally
  • 13/10/08 31/05/09
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  • Mon, 05/01/2009 - 12:15

rbirch

Alix partners costs are currenly being covered by the the IoM govt and are not coming out of funds in KSFIoM.


Alix costs

  • rbirch
  • 13/10/08 31/05/09
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  • Mon, 05/01/2009 - 12:36

ah ... ok thanks for correcting that


You can answer this one for

  • Captain Mainwaring
  • 11/10/08 31/05/09
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  • Mon, 05/01/2009 - 10:48

You can answer this one for yourself - triggering of the DCS means liquidation, liquidation means fat liquidators rooking the backside out of the assets that the bank may have had. Liquidators effectively are non-stick and it is almost impossible to challenge their actions - oh, and of course their fees come out pretty much before anyone else.

Also be aware that liquidation may not do the sub 50K group much good either.


DCS question

  • user1123
  • 14/10/08 31/05/09
  • unspecified
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  • Mon, 05/01/2009 - 09:39

Can not see DCS being an option any more as it will piss off too many financial institutions, banks and assurance companies (those with bonds), who employ too many people who pay taxes.

There are two options either pay 100% or pay nothing. This is their dilemma.


liquidation proceeds

  • Anonymous
  • Offline
  • Mon, 05/01/2009 - 05:43

I am assuming that the money recovered by the liquidators provisionally will be used to fund the DCS. If the winding up proceeds, as I expect, we will all receive money quickly under the scheme. We may all receive up to 50k (or the limit of our deposits) quickly. We may not need the 150m. Even if we do, I assume the IoM will transfer this sum to the DCS manager soon. Either way, I am optimistic about rapid compensation under the DCS.


Steenjp. Any money recovered

  • thesunnysouth
  • 10/10/08 31/05/09
  • unspecified
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  • Mon, 05/01/2009 - 11:38

Steenjp. Any money recovered by the liquidator provisional would be distributed to depositors on a pro rata basis. So if 10p in the pound recovered the £500k person will receive £50k and the £50k person will receive £5k. The DCS has nothing to do with retrieved funds. It is a top up.


As I understand it the money

  • bellyup
  • 10/10/08 09/01/10
  • a depositor
  • Offline
  • Mon, 05/01/2009 - 11:35

As I understand it the money recovered by the liquidators does not fund the DCS.

The money recovered by the liquidators will be distributed on a pro rata basis and IF necessary will be topped up - we hope - to 50K by the DCS that is funded by the IOM banks. If of course they abide by the new 50k ruling which as someone pointed out went through after the bank was closed.

At the end of this very long day those who have 50k or less will see the return of their funds.


B and B's take on DCS

  • saversinfrance
  • 10/10/08 31/05/09
  • a depositor
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  • Mon, 05/01/2009 - 16:36

Interesting to see how other IOM banks interpret the DCS. This is from Bradford and Bingley's website which suggests liquidation funds can be used on top of the £50k DCS limit. Confusing...

Examples for individual depositors:

(1) If you have a joint account with one other individual which contains £80,000, you would each be entitled to receive ½ of £80,000 ie £40,000.

(2) If in the previous example you also had £25,000 in a sole account, the total balances apportioned to you under the DCS would be your share of the joint account (ie £40,000), plus the £25,000 of your own, giving a total of £65,000. As this exceeds the maximum covered by the DCS the scheme provides for you to receive the maximum payment of £50,000. If there are sufficient funds on liquidation of the failed bank, the remaining £15,000 may be paid from the liquidation proceeds.


Copy and paste from the

  • Captain Mainwaring
  • 11/10/08 31/05/09
  • a depositor
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  • Mon, 05/01/2009 - 17:25

Copy and paste from the original - and whilst confusing doesn't contradict what we know - that the DCS is a top-up. We know that the liquidation funds pay any liability to the DCS for individual depositor, which prefers depositors with less than 50K.

Of course Bed & Breakfast won't show a simple example with an individual with 200K in the pot and a recovery of 26P in the pound - 'cos that would show it to be the piece of kak that it is.


Belly up

  • user1123
  • 14/10/08 31/05/09
  • unspecified
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  • Mon, 05/01/2009 - 11:51

Disagree. You should not be creating false hope with your lack of understanding and sweeping statements.

Those who have 50K or less will only see the return of their finds IF the DCS is activated. If it is activated, 30-40% of the banks will refuse to pay and most will pull out of Iom. Also all the insurance bond punters will not get their money back and several large life companies will pull out of Iom, all those jobs lost! The assurance companies are already up in arms as they are being regulated by a Director of KSF (Gelling). Does not do their future business prospects any good being regulated by the Director of a failed bank!! Some are starting to transfer their business and staff already. So the activation of the DCS is only a very remote possibility, so those who have 50K or less will get their funds back if Iom Gov pays out in full.

Keep up to speed if you are going to comment.


I'd be interested to know how

  • Captain Mainwaring
  • 11/10/08 31/05/09
  • a depositor
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  • Mon, 05/01/2009 - 15:26

I'd be interested to know how the DCS cannot be triggered if the liquidator is not able to return pretty much of 100% of deposits, or otherwise secure them to the satisfaction of the depositors. If they cannot then there is no grey area, the bank is paper insolvent and any one creditor could seek to wind them up - I assume at the moment that they are protected against this by the interim court order.

Of course, the liquidator may well be able together with Alix and the IoM be able to "secure" deposits to the general satisfaction of all in some way or other, to prevent a petition for liquidation by another party.

As for banks pulling out and refusing to pay, I think you will find that this won't happen. If they do, then they had better move very fast, as they won't be moving funds anywhere if the IoM applies it's ultimate sanction and removes or suspends individual banking licenses - this would create a panic that make FSF IoM look like a game of monopoly.


R Peel I would like to know

  • bellyup
  • 10/10/08 09/01/10
  • a depositor
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  • Mon, 05/01/2009 - 15:33

Firstly

I would like to know how you get your 30%-40% figure re the banks?
Did you go around asking all the banks?
Are you a member of the IOM treasury to know these things?
In short where are you getting your information from?
They, the banks must have already agreed to pay into the DCS in order to get a banking licence.
The DCS was already in existence BEFORE the KSF IOM fiasco.
There must be a contractual obligation in order for them to start practising as a bank.

However the IOM has upped the DCS to 50K so the banks may well have objected to this.
So as I understand it the IOM has said it will pay 150m to supplement the DSC. for the duration of 12 months
(up to October 9th 2009)

If the bank goes into liquidation the DCS is automatically triggered.
One cannot happen without the other.
However what we dont know is how long it will take for the DCS to pay back the 50K

The bank is not yet in default if the bank is liquidated before that date oct 9th 2009 payouts will be paid at the level agreed ie to a maximin of 50k

If some of the banks are starting to leave the IOM already it would be major news as the banking business is their main employer.

And its not so this is just scaremongering!

If you feel what I have said is incorrect it is your feeling only UNLESS you can give some bona fida proof of your facts.

Meanwhile lets all agree to add our comments with civility.


aiming for restructuring..

  • hippychickrobbed
  • 03/11/08 31/05/09
  • a depositor
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  • Mon, 05/01/2009 - 12:21

Ofcourse the insurance bonds are up in arms, how on earth can an ifa sell a bond again,to be taken out on this island its a disgrace as I see it. Its looking to me no different than some ponzi scheme and we are not shouting our head about it.Sorry but every single person be it under 50k, over 50k, 100k every bongo size should have had their money safeguarded in this .. We didnt place our funds in some banana boat country and now we are trying to mind read how this dcs is set out. There is a big responsibility on the isle of man govt to show the financial institutions they have a reasonable soloution to this because like I have said alot of these big guns will surely just pull out of IOM.. I for one will push for a permanent website this is what will happen to you if you bank here. Would you blame people like me who have lost all our savings on advice of an ifa to move . I dont think so....


My understanding is that the

  • Ally
  • 13/10/08 31/05/09
  • unspecified
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  • Mon, 05/01/2009 - 10:37

My understanding is that the liquidator distributes pro rata, so lets say he has recovered 50% of funds due, he does not pay out say £50k to each depositor he pays out 50% of each depositors balance.. So even if you had £20k on deposit you would receive £10k and not the full £20k.

You would then need the DCS to pay you back the other £10k. In the case of amounts under £20k you would collect this from contributions made by the banks.


My understanding is that the

  • user1123
  • 14/10/08 31/05/09
  • unspecified
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  • Mon, 05/01/2009 - 11:19

So who pays for the DCS?? Thought that was the banks?


Ally I agree

  • dclf1947
  • 10/10/08 31/08/09
  • a depositor
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  • Mon, 05/01/2009 - 10:49

I agree entirely with your view. The only problem is how long will this take in real terms for the the full ammount (in accordance with DCS rules) to be paid?


DCS - Timing

  • Ally
  • 13/10/08 31/05/09
  • unspecified
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  • Mon, 05/01/2009 - 11:01

Well that depends how much they need to collect. I think people have estimated they will be collecting around £15m a year from the banks.


DCS

  • Captain Mainwaring
  • 11/10/08 31/05/09
  • a depositor
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  • Mon, 05/01/2009 - 11:18

Well bearing in mind that the DCS is also distributed on a proportional basis (not that it will help me in the slightest) I would expect that (based upon complete guesswork as we only have the size of one depositor group satisfied) it will take about 13 years of solely bank contributions to get a settlement for sub 50K depositors. The DCS is actually empowered to borrow money , but lord knows who will end up paying the interest payments.

Does anyone think that the IoM may have approached all the banks who have a liability in this and suggested that they may make a one off payment towards restructuring, rather than payments over the next 15 years? IoM already have 150M towards our shortfall of 550M...........


liquidation proceeds

  • cottesmore
  • 21/10/08 16/07/12
  • a depositor
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  • Mon, 05/01/2009 - 06:57

I will leave 'others' to comment on this point.Wouldn't want to be accused of scaremongering or anything else!


Lack of communication? well

  • Captain Mainwaring
  • 11/10/08 31/05/09
  • a depositor
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  • Sun, 04/01/2009 - 17:37

Lack of communication? well it didn't start that way, but thank one of your members and a couple of sheep who seem only interested in either stiring it up, or perhaps have some other agenda that they need to get off on.

Perhaps it would be better to forget groups and divisions and remember that we are all in it for the best outcome for all.


under 50k

  • Anonymous
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  • Mon, 05/01/2009 - 05:45

Does this "best outcome for all" mean we do get complete repayment of under 50k deposits?