Iceland bank repays £3m

Geoff Driver
Geoff Driver
Have your say

A council has been repaid £3m of the money it invested in the doomed Icelandic banking system.

Lancashire County Council invested £10m in Landsbanki which went into receivership and was nationalised in October 2008.

The first instalment was repaid to the council last month and bosses hope to retrieve the majority of it, although they will have lost out on interest payments in the meantime.

County Coun Geoff Driver, county coun leader, said: “We are confident we will get something like 98% of it back.”

Last April, the Icelandic District Court found in favour of councils and ruled deposits placed by UK wholesale depositors should have priority status in the winding up of Landsbanki.

Coun Driver said: “We have been anticipating that we would get 98% back because the judgement went our way.

“The cost of it to the county council, apart from the 2% or so that we won’t get back, is we won’t get any interest back.”

Speaking about receiving the first instalment after a four-year legal battle, he added: “It’s good to have it. It’s alright being confident it’s coming back but there’s nothing like having it in your bank account.”

Chorley Council, which had £2m of taxpayers money invested in Landsbanki when it collapsed, has received £666,000.

South Ribble Council has had almost half of the £5m it deposited repaid.

The £10m from Lancashire County Council included around £2.5m on behalf of the Lancashire County Pension Fund.

Councils across the country had money tied up in Iceland’s banks when they went bust, as well police authorities, Transport For London and hospital foundations.