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KU saved £3.4m from bank collapse  Send to a friend
Written by Martin George   
Monday, 03 November 2008 15:20

Relief as University finance chiefs confirmed its £68 million is safe from the Icelandic Bank Collapse

Smart thinking by cautious university finance chiefs saved Kingston’s cash from the Icelandic bank collapse that saw both Oxford and Cambridge universities lose millions of pounds.


The university’s Finance Manager confirmed that none of its £68 million cash is invested in Icelandic banks, which folded in October due to the global banking crisis. In contrast, Oxford University lost a reported £30 million, while Cambridge University came off £11 million poorer.


Finance Manager Terry Butcher explained how Kingston avoided the mistakes of Britain’s top ranked universities: “Kingston University has never had any investments in Iceland. We follow a tight set of Kingston University treasury management policies and have generally favoured high quality UK and some European banks with a tendency to invest mainly in the UK.”


Oxford’s loss represented five per cent of its cash deposits. Had Kingston sustained a similar loss, £3.4m would have been at risk.


University finance chiefs were reluctant to speculate about how the university would have dealt with such a financial hole. However, £3.4m would represent over ten per cent of the cash earmarked for the university’s plans to replace the Rennie Building on the Kingston Hill Campus, most of the money awarded in bursaries last year, or six times the annual grant to the students’ union.


Kingston was ‘just lucky’, according to third year biomedical student Nishma Patel: “Oxford put their money in Iceland, and it just happened that Iceland went down. It could happen to anyone.”


Kingston Council had a lucky escape after it pulled £5 million out of Icelandic banks five months ago. But there was bad news for Surrey residents after Surrey County Council admitted that it had a total of £10 million deposited at the Icelandic banks, Glitnirand Landsbanki.

 

 

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