Non - Euro investements / deposits

a148pro

So...

for the first time in my life I've actually got money in the bank. But I am now convinced that the whole sh*thouse is going to go up in flames in the short to medium term.

So I don't want to leave it there. Originally I thought I'd just transfer it to a foreign bank, or a foreign owned bank. I had accounts opened in Rabo and Northern Rock Ireland. Couldn't find the details for the Rabo account though so its all in NR at the moment. Owned and guaranteed by the UK govt, also guaranteed by the Irish 'government'. I suspect the latter's guarantees are going to be rather strained if they are called in.

But then I was thinking that, effectively, if our banks go under, which is the risk I'm trying to avoid, there is a risk that this will lead to a domino effect among our European friend's banks, which will lead to increasing pressure being put on the Euro and may lead to the effective collapse / abandonment of that currency. Or so I'm given to understand, as I know little of these things myself.

So it occurs to me that if it is my fear that the Irish banks might go then really I should get out of the Euro.

So-

- what do people think about this?
- what are my options for opening accounts in foreign countries, with foreign currencies?
- what are my options for opening accounts in foreign currencies here - i.e., are there foreign banks with operations here?
- what are the factors to be taken into account in choosing an alternative currency?
- is there an easier solution, like investing in a fund which is linked to other currencies or something which might not be adversely affected by bank collapse?

Thanks in advance.

PS, I would be patriotic and keep it here but I simply do not believe the Irish banks or the government's line on the banks. Also, I believe the actions of the government and banks over the last few years have completely undermined any of the values required to ground a feeling of patriotism.

Permabear

This post has been deleted.

ballyharpat

I have some dollars in an account with AIB, I will be converting to Euro as the $ gets better against the euro. However, I would be very careful about putting money into dollars, the American economy is on shaky ground, imo, with all this QE they are doing. In reality, there is speculation that it is in worse shape than Ireland, except the Chinese keep buying the $ to benefit their economy. This is what I can gather from it anyway.

tenchi-fan

Word of warning, if you earn interest in a non-Irish, EU bank account there will be a Europe-wide retention tax of 35% after 1 July 2011. Whether this retention tax is deducted or not, you will actually be liable to tax on interest at your marginal rate.

This exceeds the new DIRT rate of 27% on Irish accounts, after which you generally will not have a further tax liability.

SkepticOne

a148pro wrote: »

- is there an easier solution, like investing in a fund which is linked to other currencies or something which might not be adversely affected by bank collapse?

If the fund is investing in, say, Aisian markets, then it doesn't really matter what the fund is denominated in. Rabbo has various funds that are managed in the US presumably in dollars but the value of them is presented in Euro terms for European customers. A devaluation of the Euro would not devalue the fund although there could possibly be tax implications as it would be regarded as a gain in Euro terms.