Isle of Man speeds up savers’ compensation
THREE-quarters of savers who lost money through the collapse of the offshore arm of an Icelandic bank will get back all of their money by September.
The Isle of Man parliament has approved a £193m Government funding package which will speed up compensation payments to savers of Kaupthing Singer & Friedlander Isle of Man (KSFIOM) under the island's Depositors' Compensation Scheme.
The bank's 10,000 savers will receive back up to the first £50,000 of what they lost from the DCS, plus any other money that is recovered by the liquidators.
Around £85m has already been paid out to depositors under the government's early payments scheme, under which people could apply for advance payments of up to £10,000.
The additional funding announced today will enable the more than three-quarters of savers who had up to £50,000 invested to get their money back in full by early September.
The funding is made up of £73m in direct support from the Government, as is required under the DCS regulations, as well as a £120m interest-free loan, which will be repaid through a £21m levy on the island's banks and from money recovered by the KSFIOM liquidator.
KSFIOM was put into liquidation in May after savers and other creditors rejected an alternative Scheme of Arrangement which had been proposed by the island's government.
The Isle of Man Treasury had claimed that 54% of depositors would get back all their money within three months under the scheme, while 76% would have received 100% within two years.
But the KSFIOM Depositors' Action Group argued that the scheme gave them little more than they would receive under liquidation, and they organised an internet campaign urging savers to vote against it.