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Banking Bill

The noble Lord may be aware that I have expressed sympathy for the position of the people of Iceland in the difficult situation in which their banks have placed them. In our representations to the Government of Iceland we have made it clear that they should not regard us as accusing them of being terrorists. At the same time, we have made it equally clear to them that we expect them to comply with their obligations in respect of depositor protection and not to act in a discriminatory way against the interest of non-Icelandic depositors, as it appears was their inclination at one stage when they were suggesting that they were going to create ““good”” banks and ““bad”” banks, leaving the non-Icelandic depositors as claimants on the ““bad”” bank. As I said earlier, the action we took, regrettable as it was in the circumstances, has nevertheless proved effective as part of our representation to protect the interest of UK depositors.