Written question asked by Lord Laird (Ulster Unionist Party), in the House of Lords. It was answered by Lord Sassoon (Conservative) on Tuesday, 19 October 2010.

Banking: Iceland

Question: To Ask Her Majesty’s Government how much financial support they have paid to retail depositors in Icelandic banks to date; how much of that has been retrieved; and what is the estimate of the amount that will not now be retrieved.

Answer: Details of the financial support provided to retail depositors in Icelandic banks and repayments received for the 2009-10 financial year are set out in the Treasury's resource accounts for 2009-10 (HC261). Total gross support in respect of Heritable Bank, Kaupthing Singer and Friedlander (KSF) and Landsbanki amounted to just under £7.76 billion as at 31 March 2010. This £7.76 billion comprises £6.68 billion of loans to the Financial Services Compensation Scheme (FSCS) to cover depositors' claims up to £50,000 and £1.08 billion to cover depositors' claims above the £50,000 cap (HM Treasury top-up payments). The £6.68 billion loans to the FSCS includes around £2.3 billion of compensation that the UK Government paid out, via the FSCS, to depositors on behalf of the Icelandic Depositors' and Investors' Guarantee Fund (DIGF). HM Treasury expects to retrieve the full balance of the loans advanced to the FSCS. With regard to the £2.3 billion paid out on behalf of the DIGF, discussions to agree repayment terms are ongoing between the UK and Iceland. Retrieval of HM Treasury top-up payments made in respect of Heritable Bank, KSF and Landsbanki will depend upon recoveries from the respective administration processes. Forecast rates of recovery are published by Ernst and Young, the administrator appointed for Heritable and KSF, and by the winding up board for Landsbanki.

Secondary information

Type: Written question
Reference: 2346; 721 c137-8WA
Session: 2010-12
Related items: Banking: Iceland
Wednesday, 15 December 2010
Written questions
House of Lords; Banking: Iceland
Wednesday, 15 December 2010
Written questions
House of Lords
Subjects: Compensation Banks Insolvency Repayments Iceland
Link: View this Written question on www.publications.parliament.uk