Britain gives Landsbanki a £100 million loan

Landsbanki the failed Icelandic bank that was nationalized by the Icelandic government will be given a £100 million bailout from the Bank of England the Chancellor Alistair Darling announced today, to help its British savers to recoup their deposits from the failed bank in Iceland.

Mr Darling has been in talks with the Icelandic Authorities to help push through claims by UK local councils and charities to get the money back from the Icelandic banks.

Darling said that he will be providing to the short-term secured loan of up to £100 million to Landsbanki to maximize the returns to the UK creditors.

Icesave which is the British online arm of Landsbanki prevented its depositors to withdraw money from their accounts after the nationalization of Iceland’s second biggest bank Landsbanki last Tuesday. The Chancellor has said that the government will guarantee to cover all deposits from British savers who have deposits in Icesave. Since the nationalization of Iceland’s three largest banks the stock markets in Reykjavik have remained shut.

Source: Guardian