Icelandic saga sees £29m of Norfolk taxpayers’ cash clawed back
09:56 06 February 2014
Almost £29m of the £32.5m of Norfolk taxpayers’ cash which was frozen in Icelandic banks has now been recovered – after the county council sold its claim against one of the banks involved.
Norfolk County Council had invested £15m in Landsbanki, £10m in Kaupthing and £7.5m in Glitnir when the Icelandic government took the financial institutions into administration in 2008.
The council, then under a Conservative administration, battled hard to recoup the money which had been invested in those banks, with cash clawed back in stages.
In October 2011, Iceland’s Supreme Court upheld a ruling made after the county council jointly led a High Court challenge that British councils which had cash in Landsbanki and Glitnir should be given priority over other creditors. The saga around Lansdbanki has drawn to a close, after the council, now under a Labour/Liberal Democrat administration, sold its remaining claim against the bank – netting a payment for the council’s coffers.
Steve Morphew, the county council’s cabinet member for finance, corporate and personnel, said: “I am satisfied that by using a competitive auction process, we have been able, after more than five years, to bring the recovery process for Landsbanki to an end.
“The sale means we have now recovered almost £29m (89pc) of our original £32.5m investment in three Icelandic banks, with more to come.
“Overall, we expect to recover more than 96pc of our original investments. Having fought Norfolk’s corner through the Icelandic courts, we faced many more years of uncertainty had we continued with the recovery process.
“It makes good financial sense to have sold our claim against Landsbanki and bank the money so it can be put to work supporting vital public services.
“This decision does not mean extra money for the council, but does remove some of the risk and uncertainty for our budget planning.”
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