Iceland drafts a deal to repay debts from its banking bailout

ICELAND has drafted a new deal to repay the British and Dutch governments the money they paid to bail out investors who had saved with several of its banks, including Landsbanki, following their collapse two years ago.

Iceland’s government put together a deal to repay Britain and the Netherlands earlier this year but the deal was rejected by voters in March.

The new deal is believed to be far lower and would see Iceland repaying 40bn to 60bn Icelandic crowns (£240m) to the British and Dutch.

The figure is well short of the £3bn both governments paid out to investors in high-interest Icelandic bank accounts. However, it is believed a big portion of the debt could be covered by a sale of assets in Landsbanki.

Dutch and Icelandic finance ministries said no deal had been reached but progress was being made.

“A final resolution of the matter will hopefully emerge within a few weeks,” the Icelandic finance ministry said.

Dutch finance minister Jan Kees de Jager said full payment would still be required.“The Netherlands does not accept anything less than the principal plus interest,” he said.