It Least We're Not Iceland

Discussion in 'Trading' started by Pa(b)st Prime, Oct 7, 2008.

    Iceland's banks faced a battle for survival Tuesday, after the country's government introduced emergency legislation to give the government sweeping new powers over its collapsing financial sector.

    Iceland's attempt to wrest control of the increasingly dire situation and restore some confidence in the country's hard-hit banking sector followed a day of panic on Monday that saw trading in shares of major banks suspended and the Icelandic krona fall a quarter against the euro.

    The British arm of Iceland’s Landsbanki stopped British customers withdrawing or depositing money Tuesday. A notice on the website of Internet bank Icesave offered no explanation for the move, but it came as Iceland’s Financial Supervisory Authority said it would take control of the country’s second largest bank.

    Prime Minister Geir H. Haarde warned late Monday that the heavy exposure of the tiny country's banking sector to the global financial turmoil was raising the specter of "national bankruptcy", AP reported.

    Iceland agreed to adopt sweeping powers over banks on Monday as its financial system tottered, its currency plunged 30 percent and a leading agency cut its credit ratings.

    The country's financial stature had swelled in recent years as its banks expanded overseas, investors took large positions in its high-yielding currency and foreign firms poured money into local projects.


    Russia takes a "positive view" of a request for credit from Iceland and is to hold talks on the issue, Russian Finance Minister Alexei Kudrin said on Tuesday, quoted by Russian news agencies.

    Iceland's central bank had earlier said the country secured a 4 billion euro emergency loan from Russia, and that the loan had been personally approved by Russian Prime Minister Vladimir Putin, however media reported a top Russian official had later denied that Moscow had granted the loan.

    "Four billion euros would be more or less what Iceland needs to cover the whole banking system assets with their reserves," Elisabeth Gruie, currency strategist at BNP Paribas told Reuters.

    "It's also a surprising move for Russia that reflects its desire to reaffirm itself as a world power."

    The government took control of the second largest bank, Landsbanki and the central bank gave the biggest bank Kaupthing a 500-million-euro ($678 million) loan. The third largest bank, Glitnir, was nationalized last week.
  2. Next week I'm putting in my bid to buy Iceland for $99.99.
  3. Not yet, but we're working on it..
  4. Mup


    Uk's not far behind...

    Looks like were going to have a public/private partnership for our banking system :eek:

    Sounds better for the media rather than to use the word "nationalisation"....
  5. zdreg


  6. hughb


    Brown condemns Iceland over banks
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    Gordon Brown criticised Iceland's ''illegal action''

    Prime Minister Gordon Brown has condemned Iceland's handling of the collapse of its banks and its failure to guarantee British savers' deposits.

    He said its action were "effectively illegal" and "completely unacceptable".

    The UK government has frozen all UK-held assets of the Icelandic bank Landsbanki after it collapsed.

    Iceland's prime minister Geir Haarde said it was "not very pleasant" to learn that anti-terror laws were being used to deal with the company.

    Landsbanki, one of many banks hit heavily by the global credit crunch, was taken over by the Icelandic government and declared insolvent on Tuesday.

    The 300,000 UK customers of its subsidiary IceSave were unable to access their accounts.

    'Further action'

    UK Chancellor Alistair Darling later announced that all UK savers affected would be protected.

    But the government has not yet offered the same for more than £900m known to have been invested in Icelandic banks by UK councils, police and transport authorities.

    In an interview with BBC political editor Nick Robinson, Mr Brown said the government was talking with local authorities about what could be done and intended to recover as much money as possible.

    He added: "What happened in Iceland is completely unacceptable. I've been in touch with the Icelandic prime minister. I said this is effectively illegal action that they have taken.

    They have failed not only the people of Iceland; they have failed people in Britain
    Gordon Brown on Icelandic authorities

    "We are freezing the assets of Icelandic companies in the United Kingdom where we can. We will take further action against the Icelandic authorities wherever that is necessary to recover money."

    He added: "This is fundamentally a problem with the Icelandic-registered financial services authority - they have failed not only the people of Iceland, they have failed people in Britain."

    Mr Haarde, asked if he felt there was a crisis in relations between Britain and Iceland, said: "I thought so for a few minutes this morning when I realised that a terrorist law was being applied against us.

    "That was not very pleasant. I'm afraid that not many governments would have taken that very kindly, to be put in that category and I told the chancellor that we were not pleased with that."

    Diplomatic moves

    But he said he had cleared up a number of issues with Mr Darling.

    Minister for Work and Pensions, James Purnell, said efforts were going on to ease the diplomatic situation with Iceland.

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    Geir Haarde on the 'painful process' facing the banking industry

    "Clearly it's been unacceptable that Iceland was only acting to protect its own depositors.

    "That's why we've acted to protect ours, and it's also been frustrating we haven't been able to get in sort of proper communication with them.

    That is now something that's been addressed - Treasury officials are going there in the next few days - and we want to make sure that we address this in a way that's constructive with the Icelandic government."

    Story from BBC NEWS:

    Published: 2008/10/10 00:22:02 GMT

  7. mokwit


    Plenty of fish in the sea.