Charities' £120m at risk in Icelandic banks

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The Independent Online

British charities stand to lose at least £120m invested in stricken Icelandic banks, it emerged today.







The National Council for Voluntary Organisations (NCVO) said it knew of six charities so far that had investments at risk.



A spokesman for the NCVO, which has called for urgent talks with Chancellor Alistair Darling to urge him to protect good causes with investments in the banks, said it estimated British charities have "a minimum of £120m" tied up with Icelandic lenders.



Naomi House children's hospice in Sutton Scotney, near Winchester, Hants, has £5.7m of deposits invested with Kaupthing Singer & Friedlander, which has gone into administration, while the Physiological Society in London confirmed it had £523,000 invested with the same bank.









Cats Protection has £11.2m of deposits in Kaupthing Singer and Friedlander (KSF).

A spokeswoman said the news would have "no impact at all on the charity's day-to-day operation".



"The deposits held by KSF were earmarked for long-term projects only and to provide a safety net in case of real emergencies.



"Therefore, the only areas of Cats Protection's work that may be affected will be those plans around future new facilities."



She added: "Cats Protection believes there is a case to be made to the Treasury that its particular deposits are public money that has been donated for us to help cats and provide benefits to the public.



"The charity feels strongly that public deposits should be safeguarded and is currently calling on, and working with, other organisations within the voluntary sector to support each other in this call to action on the Government."













City Minister Paul Myners was holding talks with representatives of the charitable sector today.

Charities classified as small businesses are covered for the first £50,000 of any investments under the Financial Services Compensation Scheme.



But while the Government has promised individual savers with deposits in Icelandic accounts that it will reimburse any losses they suffer, it has been resisting calls to extend the guarantee to the charitable sector and local authorities.



Last night the Charities Aid Foundation (CAF) called for the Government to give full protection for the charities' money.



CAF chief executive John Low said: "The Government has ignored the letter we sent in August calling for full protection for all charity deposits.



"Now it seems charities might lose millions in collapsed Icelandic banks. The impact of this on the people and causes dependent upon them could be catastrophic."

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