The Pensioneer Trustee Company (Guernsey) Limited
T +44 (0) 1481 743760
The Guernsey Banking Deposit Compensation Scheme (GBDC) has been in force since November 2008. It was designed to offer protection for anyone depositing money with Guernsey Licensed Banks, no matter where in the world they might be based. Protecting retail depositors is the scheme’s main focus. For IPP and RATS members, there are some key points to note.
In the event that a bank covered by the scheme fails, it is declared in default by the Guernsey Financial Services Commission. Compensation is then available to Qualifying Claimants who held deposits with the bank. The scheme is funded via annual charges that are paid by Guernsey’s banks. If a bank does fail then additional charges are applied.
The list of Qualifying Claimants includes the trustees of a Guernsey Retirement Annuity Trust Scheme (RATS). So, the Scheme protection applies to members of bespoke RATS, multi member RATS and occupational schemes. Qualifying Recognised Overseas Pension Schemes (QROPS) and Qualifying Non-UK Pension Schemes (QNUPS), established and approved as a Retirement Annuity Trust Scheme, are also covered. Each sub pension is protected up to £50,000 each.
The Scheme does not apply to members of 40 (o) or 40 (ee) International Pension Plans (IPP’s), as the legislation only extends to ‘Retirement Annuity Trust Schemes’ established and approved by the Guernsey Income Tax Office.
Excluding International Pension Plans or other types of retirement plans from the Scheme’s protection should not in reality create a problem for those using these plans. As these plans are normally fully invested- the risk of a bank defaulting, and a member of an IPP losing money, is small. In the event of a default, there would be other remedies available to International Pension Plan members.