And see how all govts in the world seek to protect their own people's interests ahead of foreigners while the Familee sacrifices NSmen to make FTrash happy.
U.K. Officials Travel to Iceland Over Bank Dispute (Update2)
By Kitty Donaldson
Oct. 10 (Bloomberg) -- The U.K. government is sending a delegation to Reykjavik today in an attempt to end the rift over who will compensate British depositors with money in Iceland's collapsed banks.
Officials and lawyers from the Treasury, the Bank of England and the Financial Services Authority will work with the Icelandic government over the weekend ``to find a solution to the current situation,'' a Treasury spokesman said in an e- mailed statement.
The pound dropped against the dollar to the lowest level in almost five years on concern the dispute may escalate after Prime Minister Gordon Brown yesterday threatened to freeze the assets of Icelandic companies in Britain, which employ 100,000 people.
The spat over money trapped in accounts of Kaupthing Bank hf and Landsbanki Islands hf has plunged relations between the two countries to the lowest since a 1970s dispute over North Atlantic fishing rights, known as the Cod Wars.
Brown and his Icelandic counterpart Geir Haarde yesterday traded recriminations, with Brown accusing Iceland of failing to honor its guarantee to compensate savers up to 20,887 euros ($28,400), leaving Britain to pick up the tab.
`Unacceptable'
Haarde, after speaking with U.K. Chancellor of the Exchequer Alistair Darling, said Britain triggered the crisis by using anti-terrorism laws to seize the assets of Icelandic banks.
``The prime minister made clear the behavior of the Icelandic authorities had been unacceptable, and we had found it very difficult to get information from them,'' Brown's spokesman, Michael Ellam, told reporters in London today.
``They had indicated they would give preferential treatment to domestic creditors over foreign creditors,'' Ellam said. ``We have always made it clear we want to work constructively with the Icelandic authorities.''
U.K. taxpayers will probably face a bill of at least 2.4 billion pounds to compensate about 300,000 British holders of accounts at Icesave, the online banking unit of Landsbanki, the Financial Times reported yesterday, citing unidentified British officials.
Darling has guaranteed that individual savers will not lose money, though corporate and government accounts may not be covered. Charities too face the potential loss of tens of millions of pounds.
Local Authorities
The compensation pledge has not been extended to more than 108 local councils with investments in Icelandic banks of at least 799 million pounds.
London's municipal authorities alone had more than 212 million pounds invested in Iceland. That included 40 million pounds invested by Transport for London, which provides bus and underground services for the U.K. capital, it said. The money was invested in an Icelandic subsidiary of Singer and Friedlander Group Plc, a unit of Kaupthing Bank hf.
Icelandic banks are unable to finance about $61 billion of debt, 12 times the size of the economy, according to data compiled by Bloomberg. The government in Reykjavik is seeking a loan from Russia and may ask for aid from the International Monetary Fund to help guarantee deposits.
Assets at Iceland's three biggest banks had grown fivefold since 2004 as the companies expanded beyond the island nation of 320,000, half that of the city of Las Vegas. Much of that expansion was debt financed.
Relations between the U.K. and Iceland were last as bad more than three decades ago when Icelandic coastguards cut the nets of British trawlers fishing in Iceland's self-proclaimed exclusive economic zone.
After an incident in 1976 when a nuclear-armed U.K. ship rammed an Icelandic vessel that had been net-cutting, a compromise was reached that allowed a limited number of British fishing ships into the disputed zone.
To contact the reporter on this story: Robert Hutton in London at [email protected]
Last Updated: October 10, 2008 09:00 EDT
U.K. Officials Travel to Iceland Over Bank Dispute (Update2)
By Kitty Donaldson
Oct. 10 (Bloomberg) -- The U.K. government is sending a delegation to Reykjavik today in an attempt to end the rift over who will compensate British depositors with money in Iceland's collapsed banks.
Officials and lawyers from the Treasury, the Bank of England and the Financial Services Authority will work with the Icelandic government over the weekend ``to find a solution to the current situation,'' a Treasury spokesman said in an e- mailed statement.
The pound dropped against the dollar to the lowest level in almost five years on concern the dispute may escalate after Prime Minister Gordon Brown yesterday threatened to freeze the assets of Icelandic companies in Britain, which employ 100,000 people.
The spat over money trapped in accounts of Kaupthing Bank hf and Landsbanki Islands hf has plunged relations between the two countries to the lowest since a 1970s dispute over North Atlantic fishing rights, known as the Cod Wars.
Brown and his Icelandic counterpart Geir Haarde yesterday traded recriminations, with Brown accusing Iceland of failing to honor its guarantee to compensate savers up to 20,887 euros ($28,400), leaving Britain to pick up the tab.
`Unacceptable'
Haarde, after speaking with U.K. Chancellor of the Exchequer Alistair Darling, said Britain triggered the crisis by using anti-terrorism laws to seize the assets of Icelandic banks.
``The prime minister made clear the behavior of the Icelandic authorities had been unacceptable, and we had found it very difficult to get information from them,'' Brown's spokesman, Michael Ellam, told reporters in London today.
``They had indicated they would give preferential treatment to domestic creditors over foreign creditors,'' Ellam said. ``We have always made it clear we want to work constructively with the Icelandic authorities.''
U.K. taxpayers will probably face a bill of at least 2.4 billion pounds to compensate about 300,000 British holders of accounts at Icesave, the online banking unit of Landsbanki, the Financial Times reported yesterday, citing unidentified British officials.
Darling has guaranteed that individual savers will not lose money, though corporate and government accounts may not be covered. Charities too face the potential loss of tens of millions of pounds.
Local Authorities
The compensation pledge has not been extended to more than 108 local councils with investments in Icelandic banks of at least 799 million pounds.
London's municipal authorities alone had more than 212 million pounds invested in Iceland. That included 40 million pounds invested by Transport for London, which provides bus and underground services for the U.K. capital, it said. The money was invested in an Icelandic subsidiary of Singer and Friedlander Group Plc, a unit of Kaupthing Bank hf.
Icelandic banks are unable to finance about $61 billion of debt, 12 times the size of the economy, according to data compiled by Bloomberg. The government in Reykjavik is seeking a loan from Russia and may ask for aid from the International Monetary Fund to help guarantee deposits.
Assets at Iceland's three biggest banks had grown fivefold since 2004 as the companies expanded beyond the island nation of 320,000, half that of the city of Las Vegas. Much of that expansion was debt financed.
Relations between the U.K. and Iceland were last as bad more than three decades ago when Icelandic coastguards cut the nets of British trawlers fishing in Iceland's self-proclaimed exclusive economic zone.
After an incident in 1976 when a nuclear-armed U.K. ship rammed an Icelandic vessel that had been net-cutting, a compromise was reached that allowed a limited number of British fishing ships into the disputed zone.
To contact the reporter on this story: Robert Hutton in London at [email protected]
Last Updated: October 10, 2008 09:00 EDT
