Council auctions off £2.4m claim for Icelandic money

SBC Headquarters
SBC Headquarters

THE council has cut its losses by auctioning off its claim for remaining deposits in a failed Icelandic bank, in which it had £5m invested at the time of collapse in 2008.

SBC has refused to disclose the amount received from the sale of the £2.4m claim with Landsbanki, claiming the settlement is “commercially confidential”.

The auction was organised by the Local Government Association (LGA) and involved the claims of a number of local authorities.

An LGA statement has said that most councils will have recovered more than 95 per cent of the money they had invested in the bank in October 2008.

LGA chairman Sir Merrick Cockell said: “This settlement has enabled a number of councils to fast-track their recovery of money from LBI (Landsbanki) and avoid any risk of further loss.

“From day one, we have always been clear in our determination that local government would fight to recover the lion’s share of the money deposited in Iceland at the time of the crash.”

The statement added: “Selling the claims now eliminates the risk of any further loss of value, for example, through depreciation of the Icelandic krona against sterling.”

SBC has so far recovered £4.7m of the other £5m it had in another failed Icelandic bank, Heritable.