Banking Risk

[Crossroads]

In light of the rather hysterical media coverage around Northern Rock and the resulting panic withdrawals, several threads on here and other websites have talked about the BoE(?) compensation schemes etc that safeguard your money.

However, I presume that is only protecting the consumer, and I'm sure I'm not the only one here with a significant sum languishing in my business accounts.

No matter how small the risk, it is not a pleasant thought that you could potentially lose those large sums you hadn't withdrawn just to prevent Hector getting his slice. So:
- what if Cater Allen / A.N. Other were to go under - is the money protected by BoE in any way?
- what steps can be taken to reduce or spread the risk.

Or should I just buy a load of gold and stick it under the bed?

[daviejones]

I have withdrawn my £125 and moved it to a pot under the bed!!!

[fzbucks]

isn't the amount you are covered only up to 30k anyway - so f you have a large sum of money it may never be protected fully no matter what your circumstances are eg business/personal

[TheFaQQer]

isn't the amount you are covered only up to 30k anyway - so f you have a large sum of money it may never be protected fully no matter what your circumstances are eg business/personal

No - first 2k is covered; next 33k is covered up to 90%, so the most you are guaranteed is 31700

[Old Greg]

isn't the amount you are covered only up to 30k anyway - so f you have a large sum of money it may never be protected fully no matter what your circumstances are eg business/personal

If you're worried, bank each 33k (or whatever) with a different bank.

[Old Greg]

No - first 2k is covered; next 33k is covered up to 90%, so the most you are guaranteed is 31700

Does this hold true for business deposits as well as personal deposits?

[hugebrain]

money

No the guarantee doesn't apply to business accounts, so we are in big trouble. (also be careful with personal accounts since some of the sneakier banks operate under more than one name and still only give a guarantee on a total of £35K)

Can businesses withdraw the money in Cash? I'm not sure. Would it still count as the company's money, or would the scum count it as a dividend or wages once it went from a bank account to currency?

[Crossroads]

Can businesses withdraw the money in Cash? I'm not sure. Would it still count as the company's money, or would the scum count it as a dividend or wages once it went from a bank account to currency?

Yes you could withdraw in cash. I would suggest a board meeting be held and minuted though given the sums involved. Cash however is susceptible to fire and theft to name but two. Where would you keep it?

Perhaps gold is the way to go?!

[Old Greg]

My emercgency back up plan would probably be to loan it to myself and put it in my personal NS&I account.

[TheFaQQer]

also be careful with personal accounts since some of the sneakier banks operate under more than one name and still only give a guarantee on a total of £35K

I thought the limit was per account, rather than per customer?