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| Treasury in Iceland crisis talks | |
| (about 1 hour later) | |
| A delegation of Treasury officials is going to Iceland to discuss its banking crisis and the impact on UK individuals and councils with money in its banks. | |
| The meetings follow sharp exchanges between Prime Minister Gordon Brown and his Icelandic counterpart Geir Haarde regarding the crisis. | |
| Mr Brown condemned Iceland's failure to guarantee British savers' deposits. | Mr Brown condemned Iceland's failure to guarantee British savers' deposits. |
| Mr Haarde strongly objected to Britain using anti-terror legislation to seize Icelandic bank assets in the UK. | Mr Haarde strongly objected to Britain using anti-terror legislation to seize Icelandic bank assets in the UK. |
| 'Unacceptable' | |
| Landsbanki, one of many banks hit heavily by the global credit crunch, was taken over by the Icelandic government and declared insolvent on Tuesday, leaving 300,000 UK customers of its subsidiary IceSave unable to access their accounts. | Landsbanki, one of many banks hit heavily by the global credit crunch, was taken over by the Icelandic government and declared insolvent on Tuesday, leaving 300,000 UK customers of its subsidiary IceSave unable to access their accounts. |
| Mr Brown said Iceland's actions were "effectively illegal" and "completely unacceptable". | Mr Brown said Iceland's actions were "effectively illegal" and "completely unacceptable". |
| The UK government has frozen all UK-held assets of Landsbanki after it collapsed. | The UK government has frozen all UK-held assets of Landsbanki after it collapsed. |
| Geir Haarde on the 'painful process' facing the banking industry | Geir Haarde on the 'painful process' facing the banking industry |
| Mr Haarde said it was "not very pleasant" to learn that anti-terror laws were being used to deal with the company. | Mr Haarde said it was "not very pleasant" to learn that anti-terror laws were being used to deal with the company. |
| He also said Britain was partly to blame for the collapse of Iceland's biggest bank, Kaupthing, which has now been nationalised. | He also said Britain was partly to blame for the collapse of Iceland's biggest bank, Kaupthing, which has now been nationalised. |
| "This is something that happened partly as a result of action taken against Kaupthing by British authorities, presumably to safeguard the interests of UK citizens. | "This is something that happened partly as a result of action taken against Kaupthing by British authorities, presumably to safeguard the interests of UK citizens. |
| "But I think this was very unfortunate. We were hoping that Kaupthing would be able to survive this crisis, continue as a fully functioning private bank." | "But I think this was very unfortunate. We were hoping that Kaupthing would be able to survive this crisis, continue as a fully functioning private bank." |
| Council deposits | Council deposits |
| UK Chancellor Alistair Darling has announced that all UK savers affected by the Icelandic bank crisis will be protected. | UK Chancellor Alistair Darling has announced that all UK savers affected by the Icelandic bank crisis will be protected. |
| . LARGEST CONFIRMED DEPOSITS Kent County Council, £50mNottingham City Council, £42m Transport for London, £40mNorfolk County Council, £32.5mDorset County Council, Hertfordshire County Council, £28mBarnet Council, £27mSomerset County Council, £25mHillingdon Council, £20mNeath Port Talbot Council, £20mWestminster City Council, £17mBrent Council, £15m Full list of councils affectedQ&A: Council funds at riskCouncils 'not reckless with cash' | |
| But the government has not yet offered the same for more than £900m known to have been invested in Icelandic banks by UK councils, police and transport authorities. | But the government has not yet offered the same for more than £900m known to have been invested in Icelandic banks by UK councils, police and transport authorities. |
| So far more than 100 local authorities in England, Wales and Scotland have revealed that they have deposits worth £842.5m in total. | So far more than 100 local authorities in England, Wales and Scotland have revealed that they have deposits worth £842.5m in total. |
| The councils say they have followed Treasury advice by investing surplus money to deliver the highest return for taxpayers. | The councils say they have followed Treasury advice by investing surplus money to deliver the highest return for taxpayers. |
| The Local Government Association wants the same protection for councils as has been given to personal customers of IceSave and other failed Icelandic banks. | The Local Government Association wants the same protection for councils as has been given to personal customers of IceSave and other failed Icelandic banks. |
| After a meeting with local government officials on Thursday, government ministers said they would deal with councils' financial needs on a case-by-case basis. | |
| "We have agreed that we want to work together obviously to protect service levels but this is a complicated situation," Work and Pensions Secretary James Purnell said. | |
| The financial exposure of public bodies rises to £946.8m when adding investments by police authorities and Transport for London. | |
| In addition, it is estimated that UK charities may have invested up to £120m in Iceland's banking system and are calling for support from the Treasury to alleviate any losses. | |
| "They are smaller than local authorities and they don't have the same level of financial advice so there's an immediate issue which I think we need to take up with the Treasury," said Stuart Etherington, chief executive of the National Council of Voluntary Organisations. |