Tuesday, 11 February 2014

Barnet and the Icelandic bank disaster - an interesting development

Buried away on the Council's website is notice of a decision "Sale of Claim in LBI". What this is in fact is Barnet's attempt to bring the long running Icelandic bank (Landsbanki) debacle to an end, albeit at a further cost to local council tax payers. Barnet note that whilst part of the claim has been settled we are still waiting for around £7.9 million to be returned which may take several years at least to settle.

The Local Government Association have been advised by lawyers Bevan Brittan and have appointed Deutsche Bank to sell our outstanding claim at auction which is possible under Icelandic law. The Council have set a reserve price for our debt but that is not stated for obvious reasons. How much on the pound we will get for our outstanding debt who knows, but one thing is sure, it will not be for the full amount of the debt and we will have lost years of interest.

I marvel at the irony when I think that it was the financial institutions who brought about this global banking disaster and they are now seeking to make money from their mistakes by buying up that bad debt at a discount and I'm sure Deutsche Bank aren't running this auction out of the kindness of their hearts.

I look forward to Richard Cornelius telling us exactly how much we have had to forgo in order to get at least some of our Icelandic money back.

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