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Raboplus' and citibank's deposits guaranteed?

 
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Old 12-10-2008, 09:55 AM   #1
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Raboplus' and citibank's deposits guaranteed?

Hi there,

I am looking forward to australian government approving a law for deposit protection. I think that the lack of some kinds of deposit protections in this country with a strong economy can partially explain the collapse of the AUSD in the last few days...

Query: do you think raboplus' accounts could be covered up to 100K Euro (=approx 200K AUSD) under the dutch deposit protection scheme? And aren't citibank Australia covered up to 100K USD (=around 150K AUSD) under the american protection scheme?

I've sent a couple of e-mails to both rabo and citi. I'm hoping to get an answer from them as well that I'll share here...

Cheers!
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Old 12-10-2008, 10:03 AM   #2
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I think you'll find that the Australian operations of these banks fall under the Australian prudential authority and regulation mechanisms ... the bank accounts would be domiciled in Australia rather than overseas.

I'd be very surprised if it were otherwise.
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Old 12-10-2008, 10:11 AM   #3
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Quote:
Originally Posted by Sim View Post
I think you'll find that the Australian operations of these banks fall under the Australian prudential authority and regulation mechanisms ... the bank accounts would be domiciled in Australia rather than overseas.

I'd be very surprised if it were otherwise.
Hi Sim,

...Not sure but I'd be very surprised if they are not protected! In Ireland Rabodirect (irish version of raboplus) introduced the dutch deposit protection scheme earlier than the loval government introduced the 100K and then full deposit protection for some of the banks:
Savings :: RaboDirect Online Savings & Savings Account Ireland. Try Our Savings Calculator!

And when Northern Rock was collapsing before nationalization the UK extended the english deposit protection to NR Ireland as well.

Can't foreing banks have different ways of protecting local deposits?
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Old 12-10-2008, 11:04 AM   #4
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Hi GodFather,

The USD/AUD fell due to interest rates falling, bank deposits being government guaranteed or not had nothing to do with it. If you look over the last few years, each time the RBA interest rate rose, the USD/AUD rose a little bit. Now that the RBA has dropped interest rates, the USD/AUD decreased.

Cheers,

Dan
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Old 12-10-2008, 02:01 PM   #5
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Thank you Asxbroker!
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Old 12-10-2008, 04:57 PM   #6
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Hi Asxbroker, now that K. Rudd has guaranteed all the deposits I want to check if my theory on the exchange rate was right! I'll keep checking it in the week to come! I'm expecting the AUSD to go below 1.90 against 1 Euro for sure!

...But I agree that the interest rates played a huge part into last weeks exchange rates...
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Old 23-10-2008, 07:39 PM   #7
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Just as an update on this - statement from ING Direct:

Quote:
Does the Australian Government’s deposit guarantee cover my savings in ING DIRECT?

Yes. The Australian Government will guarantee all deposits of Australian banks, Australian subsidiaries of foreign-owned banks, building societies and credit unions until 12th October 2011. ING Bank (Australia) Limited trading as ING DIRECT is an Australian subsidiary of a foreign-owned bank. For further information on the Australian Government guarantee read the Prime Minister's Media Release - 12th October 2008 or visit the APRA's list of Authorised Deposit-taking Institutions.
Is there a limit on the guarantee?

No there is no dollar limit on the guarantee. The Australian Government will guarantee all deposits regardless of amount for a period of three years from 12 October 2008.
How long does the guarantee last?

The guarantee will be in place for a period of 3 years from 12 October 2008. At the end of the 3 year period the Australian Government will review the cap on the guarantee.
Is my money safer in the big Australian banks?

Deposits with ING DIRECT, like deposits held with the big four Australian banks, are subject to the new Australian Government guarantee.
Why does the guarantee cover ING DIRECT?

ING DIRECT is the trading name of ING Bank (Australia) Limited. ING Bank (Australia) Limited is an Australian subsidiary of a foreign-owned bank. For further information visit the APRA's list of Authorised Deposit-taking Institutions or read the Prime Minister's Media Release - 12th October 2008.
From RaboPlus:

Quote:
Rabobank Australia Limited, the issuer of RaboPlus, will be covered by the recently announced Australian Federal Government guarantee of deposits.

The guarantee covers all RaboPlus at call savings accounts and term deposits for a period of 3 years from 12 October 2008.

Further details about the coverage of the guarantee can be found in the announcement made by the Australian Federal Government Treasury at the link below.
Quote:
Is RaboPlus covered by the Federal Government Deposit Guarantee?

Yes. The guarantee covers all RaboPlus at call savings accounts and term deposits for a period of 3 years from 12 October 2008.

Further details about the coverage of the guarantee can be found in the announcement made by the Australian Federal Government Treasury.

Rabobank Australia Limited, which issues RaboPlus, is prudentially regulated by the Australian Prudential Regulation Authority (APRA).

The liabilities of Rabobank Australia Limited are guaranteed by the bank's ultimate Dutch parent, AAA rated Cooperatieve Centrale Raiffeisen-Boerenleenbank B.A (known as Rabobank or Rabobank Nederland).
From Citibank:

Quote:
Deposit Guarantee

As a result of the extraordinary circumstances in global financial markets, the Australian Federal Government has announced it will guarantee all bank deposits held in Australian-owned banks, Australian subsidiaries of foreign-owned banks, building societies and credit unions.

As an Australian subsidiary of a foreign-owned bank, we would like to assure all of our clients that all their deposits held with Citigroup Pty Limited ("Citibank Australia") will also be covered by this protection.

Citibank deposits for non-residents issued by Citibank N.A Sydney Branch will not be eligible for the Australian Government Guarantee.

What deposits are covered?

The guarantee is effective immediately and will operate for a period of at least three years. There will be no limit on the amount covered.

The guarantee applies to all types of deposit accounts. For example it includes, transaction accounts, savings accounts, term deposits and mortgage offset accounts.

The guarantee applies to deposits held by all types of legal entities in Australia, including individuals (including joint accounts), partnerships, businesses, trusts and government entities.

The guarantee applies to deposits denominated in any currency.

more
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This is a general comment only and does not constitute advice. Before making financial decisions you should seek advice from a professional adviser, who can take into account your specific circumstances and investment goals.
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