Thomas Bridge 05 February 2014

Councils recoup £1bn lost to Icelandic bank collapse

Around £1bn of cash tied up in failed Icelandic banks has now been recovered by local authorities.

Just under £1.05bn had been deposited by councils in four Icelandic banks at the time of their collapse in 2008.

Following the sale of most councils’ remaining claims against the former banks through a competitive auction, it is now thought these authorities will have recovered more than 90p for every £1 invested in Landsbanki (LBI), Glitnir, Heritable and Kaupthing Singer & Friedlander.

Some £414m of council funds had been deposited with LBI at the time of the 2008 crash, with only £225m having been recovered prior to the latest auction.

According to the Local Government Association (LGA), sale of the claims has eliminated the risk of any further loss of value through issues such as depreciation of the Icelandic krona against sterling.

Further work will now commence to identify which authorities have not sold their outstanding claims against LBI.

LGA chairman, Sir Merrick Cockell, said: ‘This settlement has enabled a number of councils to fast-track their recovery of money from LBI and avoid any risk of further loss.

‘From day one, we have always been clear in our determination that local government would fight to recover the lion's share of the money deposited in Iceland at the time of the crash

‘We can justifiably say that the tenacious efforts of local government working together to get this money back have paid off,’ he added.

For your free daily news bulletin
Highways jobs

Standard Care Broker

Royal Borough of Greenwich
£28,470 - £29,502
You will be working as part of a Brokerage Team. You should have a good understanding of Personalisation/The Care Act and Direct Payments. Greenwich, London (Greater)
Recuriter: Royal Borough of Greenwich

Mental Health Commissioning Manager

Royal Borough of Greenwich
£46,638 - £49,674
It is an exciting time to join Greenwich as part of an Integrated Commissioning Unit for Adults. Greenwich, London (Greater)
Recuriter: Royal Borough of Greenwich

Director (Operations)

Cambridgeshire County Council
£79,467 - £102,014
Reporting directly to the Chief Executive and working closely with elected Members. Cambridgeshire
Recuriter: Cambridgeshire County Council

Administrator/Receptionist - Childrens Centres

Stoke-on-Trent City Council
£20,444 - £22,571
An exciting opportunity has arisen within the Supporting Families Service to work front of house Stoke-on-Trent, Staffordshire
Recuriter: Stoke-on-Trent City Council

Highways Road Worker

Sandwell Metropolitan Borough Council
£21,269- £24,920
An exciting opportunity for a Highways Road Worker has arose based at Taylors Lane, Oldbury. Sandwell, West Midlands
Recuriter: Sandwell Metropolitan Borough Council

Partner Content

Circular highways is a necessity not an aspiration – and it’s within our grasp

Shell is helping power the journey towards a circular paving industry with Shell Bitumen LT R, a new product for roads that uses plastics destined for landfill as part of the additives to make the bitumen.

Support from Effective Energy Group for Local Authorities to Deliver £430m Sustainable Warmth Funded Energy Efficiency Projects

Effective Energy Group is now offering its support to the 40 Local Authorities who have received a share of the £430m to deliver their projects on the ground by surveying properties and installing measures.

Pay.UK – the next step in Bacs’ evolution

Dougie Belmore explains how one of the main interfaces between you and Bacs is about to change.