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In short, I have a personal current account with a UK bank which holds funds in Euros.

Is this account protected by the UK Financial Services Compensation Scheme (FSCS)? If so, is the limit based in Euros or an exchange rate off of the sterling limit? And in which case, what exchange rate is used?

I've found various search results that say the current protection limit of £85,000 is "the equivalent of €100,000" (e.g. https://www.fscs.org.uk/news/comp-limits/limit-update/) but nothing that specifically says which currencies are protected under the scheme or the mechanics of how it protects non-sterling currencies.

Vicky
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Mike
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2 Answers2

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Are Euro deposit accounts in UK banks protected a) if the customer in UK-based, b) if they’re a non-UK resident?

Yes, foreign currency accounts with failed UK banks would be converted to GBP prior to compensation been paid. There is no residency requirement.

https://www.fscs.org.uk/what-we-cover/#!/synthetix/article/qed00357

Alex Ward
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I googled for FSCS "exchange rate" and found

https://www.fscs.org.uk/globalassets/pdfs/2017-03-24-fscs-guide-to-scv---mar-2017-final-1.pdf

The Depositor Protection Rules require that the exchange rate as at the default date is used when converting foreign currency accounts into Sterling, but do not require a particular exchange rate to be used. However, FSCS recommends the Bank of England’s spot rate on the date of default to be appropriate.

Deposit takers can find the relevant exchange rates at the website below and should note that the rate for a certain day is not published until the morning of the following day.

http://www.bankofengland.co.uk/statistics/index.htm

FSCS asks deposit takers to provide the exchange rate and source of the exchange rate used in their SCV effectiveness report.

The SCV (Single Customer View) is a report that deposit takers (ie banks) must provide to the FSCS.

AakashM
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