Iceland to restructure banks

The Icelandic government will today announce a €1.5bn (£1.3bn) recapitalisation of its collapsed banking sector, and announce a deal which will see control of two of the country’s new banks pass to foreign creditors. The government plans to issue bonds worth 270bn Icelandic kronur (£1.3bn) to the three new banks set up in the wake of the collapse of the country’s three main banks. Creditors to the failed banks will be given the opportunity to stake up equity in two of the newly created institutions.