<tadas.blinda@[EMAIL PROTECTED]
> wrote in message
news:33d5593a-0b0a-4c40-a038-293f49a4c159@[EMAIL PROTECTED]
Oct 7, 12:22 pm, "captain." <spammersmust...@[EMAIL PROTECTED]
> wrote:
> sorry, no links yet. i do know that it is to help prevent a *possible*
> collapse of the krona.
>
> this link sums up the situation preceding the
>
loan:http://www.independent.co.uk/news/business/news/iceland-suspends-bank...
Where did you get that bull****? The word "Russia" is not mentioned
in this article.
------------------------------------
as i originally stated, i had no link for the russian loan story, as it
was
still super-fresh at the time. i'm sure you could probably find one now.
the
link i provided dealt with " the situation preceding the loan", again, as
stated.
-------------------------------------
Iceland suspends bank stocks as króna plunges
By Sean Farrell, Financial editor
Tuesday, 7 October 2008
Iceland suspended trading in its main banks and guaranteed savers'
deposits yesterday after the country's currency went into freefall and
the Government was faced with the prospect of financial and economic
meltdown.
The suspension of share dealing in banks and other financial firms by
the Financial Supervision Authority just before the local stock
exchange opened was designed to stop panic trading.
The regulator said fears about the banks' security had reached the
stage where prices would not be set norm-ally. The decision was also
made to ensure equal treatment of invest-ors because "the issuers
cannot ensure confidentiality of price-sensitive information which has
not been made public".
The Icelandic Government became the latest to guarantee all bank
deposits in a bid to reassure local savers.
The króna, which had already lost a fifth of its value against the
euro, plunged a further 23 per cent yesterday to a record low of 230,
after steep declines last week. The currency's woes put further
pressure on Iceland's banks and the country's 320,000 people by
increasing the cost of their foreign debts.
Iceland's biggest bank, Kaupthing, said at the weekend that it was
financially sound but investors were panicked after Glitnir, its
smaller rival, was rescued last week despite repeated government
assertions that the financial sector was in good health.
After the Government spent €600m bailing out Glitnir, fears about the
rest of the country's banks has hit confidence in Iceland's once-
booming economy. Iceland's banks have expanded internationally and
piled on loans in recent years, resulting in the assets of the biggest
three lenders totalling about 14 trillion króna, or nine times the
country's economy.
Iceland's banks are now looking to sell overseas assets and bring the
money back into the country to reduce pressure on the currency and
ease local credit conditions. Landsbanki, the island's second-biggest
bank, has already agreed to sell off some businesses, including its UK-
based brokerage business.
Kaupthing bought the UK bank and wealth manager Singer & Friedlander
in 2005 and is a lender to Baugur, the investment company whose UK
retail holdings include Hamleys, and the entrepreneur Robert
Tchenguiz. The Government is also calling on pension funds to
repatriate overseas funds.
Another bailout would be hard for the Government to finance because
the central bank's foreign reserves stood at 308 billion króna in
August.
Marathon talks at the weekend failed to produce a hoped-for financial
stability plan. The increasingly divided Government's banking
minister, Brogvin Sigurdsson, said the plan was "well under way".
The cost of insuring against debt default by the three biggest banks
rose to records in credit default markets (CDS) last week, making the
lenders the least-trusted issuers of bank debt in Europe. Markets have
also shunned the country's sovereign debt, with CDS prices hitting a
record last week after a series of downgrades by rating agencies.
Iceland's woes are the most extreme example of the further financial
stress facing European financial systems. Yesterday, BNP Paribas
completed the virtual dismantling of Fortis, the Benelux financial
services group.
The French bank paid €14.5 billion to take over Fortis's Belgian and
Luxembourg banking operations and Belgian insurance arm in a deal
brokered by Belgium's Government. The move followed the Dutch
Government's shock nationalisation of Fortis's Netherlands business on
Friday.
Shares in Italy's UniCredit were suspended repeatedly yesterday as its
shares fell sharply after a U-turn move to raise €6.6 billion from
investors.
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