British govt claws back £1.36bn from Iceland after Landsbanki bank collapse
The UK Treasury has recovered a further £1.36bn from Iceland after its Landsbanki bank collapsed at the height of the financial crisis, forcing a taxpayer bailout for 230,000 savers in the UK.
The British government through the Financial Services Compensation Scheme paid out £4.5bn after the collapse in October 2008 of Landsbanki , which operated high-interest internet accounts in Britain through the Icesave brand.
Economic Secretary to the Treasury Andrea Leadsom said she had been pressing ministers in Iceland to speed up the return of UK taxpayers’ money.
The Treasury said a total of £3.82 billion has now been recovered from the Landsbanki estate, or 85% of its total claim, which is expected to be fully met by 2017. The latest sum is the fifth in a series of instalments since 2011.
Payment received today will be used to pay down the national debt.
Ms Leadsom said: “A key part of our long term economic plan is getting taxpayers’ money back from the financial crisis, including the collapse of Iceland’s banking system in 2008.
“The failure of the Icelandic banks cost taxpayers billions of pounds, with no certainty of ever getting the money back.
“We remain committed to recovering the full outstanding amount of the British taxpayer’s claim from the Landsbanki estate, and will continue to work hard to make this happen as soon as possible.”