JERSEY’S banks are safe, says the Island’s Treasury Minister Senator Terry Le Sueur.
He told businesses this week that even if one of the banking groups was in dire straits, the government of the parent company would not allow the Jersey branch to go under.
The minister was guest speaker at a seminar on the new zero/ten tax arrangements. However, several questioners were more concerned about their savings. ‘All banks in Jersey are in the top 500 and the majority are in the top 100. Their host country would not let them fail,’ said Senator Le Sueur. ‘The risk of any going belly-up is virtually non-existent.’
He said that this was not the policy in Guernsey, where a branch of Icelandic bank Landsbanki has gone into administration. Jersey residents with deposits there are still waiting to know what will happen to their savings.
On Wednesday Chief Minister Frank Walker sought to assure Islanders that their savings deposits would be guaranteed should anything similar happen to a bank in this Island. But Senator Le Sueur said he did not think that the States of Jersey would be called on to pay out any such guarantees.
He said that because most of the money deposited in Jersey was funnelled through the City of London, the chances were that any depositor protection arrangements put in place by the UK government would be extended to Island branches – as happened earlier this year in Guernsey, which had a branch of Northern Rock.
Senator Le Sueur said that similar extensions to guarantees had applied during the 1970s.