British FSA offerred help to Icesave before collapse

Seajays

Interesting if true - the FSA offerred to relocate responsibility of Icesave to the UK prior to the nationalisation and subsequent collapse.

Icelandic entrepreneur Björg!lfur Thor Björg!lfsson, who held one of the largest stakes in Landsbanki Bank, stated in an interview on Stöd 2 news magazine Komp!s last night that before Landsbanki was nationalized, the British Financial Supervisory Authority had offered to fast track the process of shifting the responsibility of the Icesave deposits to Britain.

Björg!lfsson claimed in the interview that the British Financial Supervisory Authority had been prepared to speed up the relocating of the responsibility for the Icesave deposits provided Landsbanki submitted GBP 200 million (USD 309 million, EUR 249 million) in collateral. Landsbanki therefore applied for a loan of that amount at the Central Bank, Morgunbladid reports.
...
Minister of Industry Össur Skarph!dinsson denies Björg!lfsson’s claims. “That offer was never presented to the group of ministers who were working on those matters from time to time and I do also not recall that it was discussed in the cabinet.”

Prime Minister Geir H. Haarde also denied having received such an offer from the British Financial Supervisory Authority in an interview with Stöd 2 last night.

Björg!lfsson suggested in the Komp!s interview that the Central Bank’s refusal to grant Landsbanki the GBP 200 million loan, which would have allowed them to accept the British FSA’s offer, might have caused the anger of British authorities and the harsh measures undertaken to seize assets of the Icelandic banks in the UK. Some believe these measures led to the downfall of Kaupthing Bank.

http://www.icelandreview.com/icelandreview/daily_news/?cat_id=21123&ew_0_a_id=314440

KingL

Same story with some different angles and crevices posted last night :
http://forums.moneysavingexpert.com/showpost.html?p=15355685&postcount=5

KingL

Channel 4 currently reporting that Iceland's pleas for help in March were ignored by the UK

http://www.channel4.com/news/articles/business_money/should+savers+have+been+warned/2700367

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blondieleopard

yes...I watched ch4 feature on situation re iceland banks....apparently UK govt and FSA knew way back in march that iceland in really bad way...and Iceland had been asking UK and IMF for help...also Mervyn King asked for assessment at IMF meet to ascertain state of Iceland banks...UK govt chose not to disclose this information..and FSA chose NOT to act......which in my view further condemns the FSA for the impotent agency it has been over last 10 yrs..... ....also Iceland had asked UK govt to put UK arm of Landsbanki under FSCS.. this was not done either..which has led to present situation.....
so this clearly puts response of UK govt to this entire debacle into a different light...and those of us....congratulating Brown and Darling may need to reassess our position....
clearly it was difficult position for UK govt..and disclosure could have led to run on Iceland banks...nut look what happenend anyway....cos no funding was forthcoming..
but you have to ask the question....what was FSA doing in allowing billions of pounds to go into these banks from private investors and Councils..when banks were known to be in danger...