Savers in the UK are moving their money between providers to find a safe home for their money.
Anecdotal evidence suggests that people are shifting their cash to savings providers that they consider to be strong or that are backed with Government guarantees.
Savers are flocking to banks such as Lloyds TSB and Abbey, which is owned by Spanish giant Santander, as well as to the Treasury-backed National Savings & Investments.
The Irish Government’s pledge yesterday that it would guarantee all money saved with an Irish institution for two years is also thought to be causing a flow of money to Irish banks.
A Bank of Ireland spokeswoman said anecdotal evidence suggested that British savers were moving cash to the bank to take advantage of the guarantee.
She said the bank was seeing a “very, very steady” increase in people contacting its call centres from the North, and it is thought the pattern is the same across the UK.
The move by the Irish Government comes just over a week after it increased the guarantee limit for savers from €20,000 to €100,000.
Savings products at the Post Office in the UK are backed by the Bank of Ireland, meaning that savers will benefit from the Irish Government’s guarantee.
A Post Office spokeswoman said: “Since last week when the government first changed the amount that was protected, we have seen an increase (in savings customers).”
National Savings & Investments, which is backed by a UK Government guarantee, has also seen an increase in interest.
A spokeswoman said: “We have seen a higher volume of calls than usual to the call centre.
“But it is too early for us to say if the number of calls will have had an effect on sales.”
The strength of Abbey and its parent Santander was flagged up this week, after the Spanish bank acquired the savings assets of Bradford & Bingley.
Anthony Frost, of Abbey, said: “We have seen an increase in savings inflows because people see Abbey, because of Santander Group, as a safe haven.”
Lloyds TSB also told Channel 4 news: “Recently, we have seen a significant increase in deposits and in the last week alone, double the average numbers of term deposit accounts have been opened.”
But consumers in the UK were reminded that the first £35,000 (€44,000) they have saved with each banking group is protected by the Financial Services Compensation Scheme, in the unlikely event that a UK bank failed.
The British government plans to increase that limit to £50,000 (€63,000), but even at the lower level, the Financial Services Compensation Scheme would cover 97% of savers’ money.
Michelle Slade, of financial information group Moneyfacts.co.uk, said: “The first thing that consumers should look at is the rate that they are getting. It is very unlikely that a bank would be allowed to fail.”