Page last updated at 14:00 GMT, Thursday, 9 October 2008 15:00 UK

Savings protection boost approved

Isle of Man Bank
Isle of Man savers are currently protected up to 15,000

Legislation to protect savings held in Isle of Man banks up to the value of 50,000 has been approved.

Members of Tynwald held an emergency sitting - the first since 1967 - to approve the new measures on Thursday.

But during a three-hour debate treasury minister Allan Bell did not say whether depositors with Kaupthing Singer & Friedlander would be protected.

The Isle of Man subsidiary of the bank - the latest victim of the global financial crisis - has been wound up.

The Financial Supervision Commission (FSC) confirmed news of the bank's demise on Thursday.

It was owned by Icelandic banking giant Kaupthing - the third institution to be taken over by its government.

Depositors contacted

Although the Isle of Man bank was not owned by the UK subsidiary, it had a "significant working relationship", the FSC said.

A spokesman for the FSC said: "Following consultation with the commission, the board of Kaupthing Singer & Friedlander (Isle of Man) Limited has notified the commission that it has passed a resolution that the company be wound up.

"The commission has suspended the banking licence of Kaupthing Singer & Friedlander (Isle of Man) Limited with immediate effect."

The FSC said that depositors would be contacted and invited to make a claim once the depositors' protection scheme (DPS) was activated.

A statement on whether savers will be protected by the new DPS is expected later.

Previously, the level of guaranteed protection for savings in Manx banks was 15,000.

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