Failed banks compensation scheme

A new compensation scheme for Jersey savers will be backed by States reserves if banks fail in the island.

Politicians agreed to guarantee the Deposits Compensation Scheme with money from the Strategic Reserve in a vote on Friday night.

The insurance scheme will be paid for by banks and taxpayers and will pay out a maximum of £50,000 to individual savers should a bank fail in Jersey.

However, reserves will only be used if more than one major bank goes under.

About 100 savers in Jersey lost £3.5m when the Channel Islands branch of Icelandic bank Landsbanki collapsed last year.

So far they have only received a percentage of their money back from administrators.