Savers get reassurance over cash risks

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savers who hold money with Northern Rock and Virgin Money received reassurance they would still be entitled to the same levels of compensation if the institutions went under.

The Financial Services Compensation Scheme (FSCS), which protects money in banks, building societies and credit unions, said both organisations will maintain separate banking licences when the sale of Northern Rock to Virgin Money goes through on January 1.

This means that customers will not see their compensation limits slashed in half if the banks hit trouble and they can still claim the full amounts.

The level of deposits covered by the scheme stands at £85,000 for single accounts and £170,000 for joint accounts.

FSCS chief executive Mark Neale said: “Anyone with savings above those limits should consider spreading their money around to ensure it is safe.”