Iceland to repay US$5.7 billion
(19 October 2009 – Global) The Icelandic government has agreed to repay Britain and The Netherlands $US5.7 billion ($A6.2 billion) that it borrowed to compensate savers who lost their funds in the collapse of an Icelandic internet bank.
Britain and Netherlands agreed in June to lend Iceland the funds to reimburse the customers of failed internet bank ‘Icesave’.
Iceland will pay A$4.1 billion to Britain and A$2.1 billion to The Netherlands from 2016. The government will spread the payments out over several years and the repayments will loosely reflect the pace of the nation’s recovery from the global economic crisis.
In order to be able to draw on a promised bailout fund from the International Monetary Fund and Nordic countries of A$5 billion, Iceland had to have made an agreement to settle the debt.
The Icelandic government proposed an earlier contract which was rejected by the British and Dutch governments regarding the expiry date of the state's guarantee for the repayment; the date was set for 2024 regardless of whether the amount was paid in full.
The Icelandic government has now agreed that its state guarantee will not expire in 2024 and it will continue to make payments until the debt is paid in full.
Iceland will pay A$4.1 billion to Britain and A$2.1 billion to The Netherlands from 2016. The government will spread the payments out over several years and the repayments will loosely reflect the pace of the nation’s recovery from the global economic crisis.
In order to be able to draw on a promised bailout fund from the International Monetary Fund and Nordic countries of A$5 billion, Iceland had to have made an agreement to settle the debt.
The Icelandic government proposed an earlier contract which was rejected by the British and Dutch governments regarding the expiry date of the state's guarantee for the repayment; the date was set for 2024 regardless of whether the amount was paid in full.
The Icelandic government has now agreed that its state guarantee will not expire in 2024 and it will continue to make payments until the debt is paid in full.
Subscribe