Iceland rises from ashes of banking crisis – timeline
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Version 0 of 1. Iceland, which became an emblem of the 2008 global financial meltdown, hopes to end its isolation by lifting capital controls imposed during the crisis. October 2008 The country’s banking system is taken over by the government, after its three largest banks run out of money. Glitnir, Landsbanki and Kaupthing have amassed assets 10 times greater than the size of Iceland’s annual economic output, but can no longer fund themselves. The collapse of Landsbanki means that 400,000 British and Dutch savers who have put money into its Icesave accounts have lost their deposits. The UK and the Netherlands say they will be refunded in full using taxpayers’ funds. Alistair Darling, then chancellor of the exchequer, uses anti-terrorism powers to freeze Landsbanki’s UK assets. November 2008 Iceland imposes capital controls to protect the krona and stop foreign currency flooding out of the country. The government receives a $2.1bn (£1.4bn) loan from the International Monetary Fund, the first western European state to get an IMF bailout since 1976. February 2009 Prime minister Jóhanna Sigurðardóttir’s centre-left coalition is elected on a promise to apply for EU membership. March 2010 Icelandic voters overwhelmingly reject a referendum proposal to pay the UK and the Netherlands €4bn in compensation for the collapse of Icesave. The Eyjafjallajökull volcano begins erupting, creating a giant ash cloud that hovers over the Europe and grounds flights for more than a week. December 2010 Iceland’s government agrees a plan to repay the UK and the Netherlands €4bn lost in the Icesave collapse. The final repayment will be made by 2046. April 2011 Iceland’s voters reject the Icesave repayment plan in a second referendum. On this occasion, 58% voted no, compared with 93% who voted against an even tougher plan in the first referendum. February 2012 Fitch credit-rating agency raises Iceland’s rating to BBB-, meaning the country is fit for investment. January 2013 Iceland wins a sweeping victory at the court of the European Free Trade Association, upholding the government’s decision not to compensate the UK and the Netherlands for the lost Landsbanki deposits. April 2013 A centre-right Eurosceptic coalition comes to power. The Social Democrats are punished at the ballot box, after four years of austerity tailored to international lenders’ requirements. March 2015 The government announces it is no longer seeking EU membership. June 2015 Iceland’s parliament approves measures to ease the end of capital controls. |