In the aftermath of the financial crisis, a spate of building society takeovers peppered daily news broadcasts. Initially, the Government acted to protect savers who had money stashed in two different building societies that merged, but that ended in December 2010.
So, if you have money in more than one of the institutions contained within the following groups, you now only have £85,000 protection across that group.
- Co-operative Bank and Britannia
- Nottingham and Shepshed building societies, trading as Nottingham BS
- Yorkshire, Chelsea, Barnsley, Norwich & Peterborough building societies, plus Egg.
Nationwide used to share its protection with Cheshire, Derbyshire and Dunfermline Building Societies, but all products held with the three smaller building societies are now Nationwide branded. The same is true of Coventry BS and Stroud & Swindon BS – any old S&S accounts are now Coventry branded.
There are lots of overseas-owned banks operating in Britain, including Santander, ICICI and Yorkshire Bank. Providing they’re not ‘offshore’ accounts (which are very different), it’s usually irrelevant who their parent company is.
They’re UK-regulated banks, so you get the same £85,000 per person protection. Yet there’s a subtle extra dimension…
If a bank gets into trouble, it’s to be hoped there’d be a bailout which didn’t affect savers, so all your money’s protected (though that, of course, isn’t guaranteed). This didn’t just happen with UK-owned Northern Rock and Bradford & Bingley, but also with Iceland-owned (but UK-regulated) Kaupthing Edge.
Where possible, always keep your cash within the £85,000 limit, as it’s an aim but not a promise to bail out banks that fail. However, this is particularly true with non-European banks, as this has not been tested yet (and hopefully won’t be!).