Steingrimur J. Sigfusson, Iceland’s Finance Minister said that Iceland has been in close and positive communication with the British and Dutch authorities over the Icesave deal. Officials have looked closely at the British and Dutch response to the amended contract passed by the Icelandic parliament and the ambassadors of the two countries were yesterday called to a meeting in Reykjavik to be updated on the initial Icelandic reaction to the British and Dutch ideas. “That is the stage we are currently at,” Sigfusson said.
The ideas were presented to the parliamentary finance committee in Iceland and political parties were also permitted to see and discuss them – some with strong feelings. For example, the Progressive and Independence parties both said some of the proposals would be out of the question.
The British and Dutch authorities accepted many of the proposed amendments to the deal; but among the unresolved disagreements is Iceland’s desired 2024 cut-off date for repayments.
At this stage, the debate continues and more details are expected over the coming weeks.
The representatives of the British and Dutch governments have, as usual, been given the authority to negotiate. But who are they negotiating with? It looks like every MP in the entire Icelandic parliament! What an inefficient process when the nation doesn’t trust the government and so their every trip to the toilet has to be first checked with opposition MPs.
2024? – Only speculative explanation has been provided as to why debts should be absolved in this timeframe.
Fisy – an ardent defender of the Icelandic position, acknowledges feeling ‘uncomfortable’ with this position.
http://www.icenews.is/index.php/2009/09/02/icelandic-president-signs-icesave-deal/#comment-92309
Maybe it is as simple as – not wanting to pass on a debt burden to children and beyond.
However, if Icelanders do not fulfil their obligation – it would mean that others paying the price of miscreant banks within their own countries would have to pick up your burden also.
“If Icelanders do not fulfill their obligation….” – Iceland’s “obligation” under the banking regulations (which complied with EU banking standards) in effect at the time of the Icesave collapse were very small (the deposit guarantee fund, and no more, was at risk. There was no obligation to borrow.). In response to British political pressure, including the unprecedented listing of Icelandic banks as “terrorists” under security legislation and British pressure on the IMF to withhold assistance to Iceland, the Icelandic government was forced to assume an extraordinary burden. Since the regulatory failure was as much British as Icelandic (who approved all those local authorities depositing money in Icesave accounts?), Britain ought to be picking up part of the burden.
What a huge success of demokratia! They are permitted to see!
So people of Iceland ought to pay for the whole show but their representatives only “permitted”? What the ****?
I think this is fair. At least it was their burden to check foreign bank before giving them money. Don’t you think so?
Andrew – I question nothing, but the terms of the guarantee. The below link reassured me that all would be well.
http://blog.moneysavingexpert.com/2008/04/01/icesave-how-safe-are-your-savings-facts-and-myths/
Perhaps Iceland’s banks would have collapsed without the UK use of ‘terrorist’ legislation.
Other countries – most notably Ireland have managed (so far) to avoid Iceland’s fate (the old joke – what’s the difference between Iceland & Ireland – one letter & six months).
>the Icelandic government was forced to assume an extraordinary burden.
Iceland is a sovereign country. Not to be forced – if terms are not acceptable – then it is Iceland’s prerogative whether to accept or decline.
Alexander,
>I think this is fair. At least it was their burden to check foreign bank before giving them money. Don’t you think so?
Maybe, for authorities having people paid well for their expertise in these matters – but have a little sympathy for the little persons like myself, who were not greedy but participated in a highly competitive (but not unique) offering. Again, I would refer you to the link above.
Alexander E,
Just to point out that the word “permitted” was my own. I could just as easily have said “Given the opportunity to see” or “allowed to see”.
The tone of the debate here should not hinge on language!
Thanks for reading IceNews
Alex, editor
To Terry:
>>>>I question nothing, but the terms of the guarantee. The below link reassured me that all would be well.
I would never recommend using a web site, even if it is called “moneysavingexpert.com”, to ever decide if any particular deposit guarantee scheme should be considered “safe”. Actually, in the real world no guarantee scheme never fully is, since they and the government are always smaller than the largest banks of the respective country.
Its also important to remember, that before the whole banking system in Iceland crashed, almost no one assumed this could possibly happen, a true black-swan event. Therefore, most recommendations and advice that were given before were simply wrong, in light of what occurred last fall.
>>>>Iceland is a sovereign country. Not to be forced – if terms are not acceptable – then it is Iceland’s prerogative whether to accept or decline.
Well, by holding up the IMF and Nordic loans, a heavy pressure being applied to Iceland to give in to UK/Netherlands demands. While the Icelandic government has seemingly been willing to give in to these demands, so far the Althingi has not.
>>>>but have a little sympathy for the little persons like myself, who were not greedy but participated in a highly competitive (but not unique) offering.
Same description would definitely apply also for most Icelanders, that are now being asked (forced) to pay for the IceSave guarantee.
I don’t think any UK local authority invested in Icesave, as this was aimed at retail investors. Most local authorities caught out by the Iceland bank collapse had put their money either in Heritable Bank (a Landsbanki owned British Bank regulated by the UK FSA) or Kaupþing Singer Friedlander (a Kaupþing owned British Bank regulated by the UK FSA).
The real question so far as the Local Authorities are concerned is why did the UK Govt let these 2 British banks fail when they bailed out Royal Bank of Scotland and Lloyds with, potentially, hundreds of billions of pounds of taxpayers money.
I don’t think any of the Icesave ‘loan’ is to compensate anybody other than retail depositers. I wish the UK and Dutch govts would just take what’s on offer from Iceland and draw a line under this poisonous dispute. It’s starting to look like flogging a dead horse.
“before the whole banking system in Iceland crashed, almost no one assumed this could possibly happen, a true black-swan event”
Bjarni – Yes, but the whole point of the deposit guarantee scheme was to handle the specific explicit black-swan event of when the banks collapse! The situation is equivalent to an insurance company taking premiums against a specific explicit event occuring and then, when it occurs, trying to justify not paying out because that specific event was more likely than predicted.
“I wish the UK and Dutch govts would just take what’s on offer from Iceland and draw a line under this poisonous dispute. It’s starting to look like flogging a dead horse.”
Mike – Don’t ever apply for a job as a negotiator! ;-)
Whilst I’m sure that it has in fact been the UK & NL holding up the loans, it’s interesting to see that the IMF says that the Nordic loans are conditional on the Icesave agreement and that is what’s holding it up:
“However, the official position of the IMF is that as the Nordic loans are contingent on the resolution of the Icesave agreement, the board wants to wait until all the parts of the financing are in place, before the review takes place.”
http://www.bloomberg.com/apps/news?pid=20601085&sid=ayVsxSsSTQ.A
To Bromley86
>it’s interesting to see that the IMF says that the Nordic loans are conditional on the Icesave agreement and that is what’s holding it up:
In the link I provided earlier – the Icesave response stated -
“In the extremely unlikely event that the Icelandic government wasn’t in a position to meet all claims, all the Nordic countries have an arrangement where they will step in and help any one of the participating countries that are in trouble so there is an additional layer of reassurance and cover.”
Not exactly a seamless process!
To Jim:
>>>>Bjarni – Yes, but the whole point of the deposit guarantee scheme was to handle the specific explicit black-swan event of when the banks collapse!
Well, we will have to disagree on this point. Deposit guarantee schemes are only really designed to deal with individual bank failures. No deposit guarantee scheme (or even governments) can ever handle paying everyone out their deposits after a complete collapse of the whole banking system.
For further information on this subject, see for example the following quote (page 179):
“It is accepted that deposit guarantee schemes are neither meant nor able to deal with systemic banking crises, which fall within the remit of other parts of the “safety net”, e.g. supervisors, central bank, government.”
from this French report published in 2000:
http://www.banque-de-france.fr/gb/supervi/telechar/2000_deposit.pdf
BTW, this French report is a very interesting read, highly recommended for anyone interested in learning more about deposit guarantee schemes. I would also recommend reading:
http://www.bankofengland.co.uk/education/ccbs/handbooks/pdf/ccbshb09.pdf
which includes a very good explanation of different types of guarantee schemes, including why deposit guarantee schemes can in some cases end up creating a moral hazard.
To Bromley86:
>>>>Whilst I’m sure that it has in fact been the UK & NL holding up the loans, it’s interesting to see that the IMF says that the Nordic loans are conditional on the Icesave agreement and that is what’s holding it up:
Guess what, at the same time the Nordic countries are saying they can not finalize their loans until IMF has done their review (which has been postponed now several times since February).
Everyone knows, that as soon as the IceSave agreement is final, all these mysterious holdups will suddenly disappear. They are just not willing to call a spade a spade.
To Bjarni
>I would never recommend using a web site, even if it is called “moneysavingexpert.com”, to ever decide if any particular deposit guarantee scheme should be considered “safe”.
I would like to think that many of us are a little wiser.
>Same description would definitely apply also for most Icelanders, that are now being asked (forced) to pay for the IceSave guarantee.
Well yes, of course I have sympathy for Icelanders, but that does not negate my comment:-
“if Icelanders do not fulfil their obligation – it would mean that others paying the price of miscreant banks within their own countries would have to pick up your burden also.
To Mike Smith
>I don’t think any UK local authority invested in Icesave, as this was aimed at retail investors.
Yes you are right, but the point I make – is that the average saver didn’t have the knowledge available to those intimately associated with banking.
I disagree with the ‘accept what is on offer’ stance. Whilst, I agree with your comment re ‘flogging a dead horse’ –
http://www.icenews.is/index.php/2009/07/29/more-members-of-parliament-against-the-icesave-deal/#comment-88411
This does not mean that Iceland should get a ‘get out of jail card’.
“Deposit guarantee schemes are only really designed to deal with individual bank failures”
I disagree. It is more accurate to say that Iceland’s deposit guarantee scheme (rather than deposit guarantee schemes in general) wasn’t designed to deal with more than one bank failure. The UK’s deposit guarantee scheme, for example, successfully handled several simultaneous bank failures. So, Iceland’s design failure doesn’t imply that the guarantee specification is limited to only one individual bank failure.
Remember that Iceland failed to regulate its deposit taking activities such that it could satisfy its guarantee obligations. It’s that simple (ie the state’s ability to cover the guarantee should limit the deposit taking). However, I appreciate that, if you’re Icelandic, then the guarantee obligations disappear (by some kind of magic) when more than one bank fails and also the state isn’t actually responsible (by another kind of magic) and… and…
Mike Smith wrote:
>I don’t think any UK local authority invested in Icesave, as this was aimed at retail
>investors. Most local authorities caught out by the Iceland bank collapse had put
>their money either in Heritable Bank (a Landsbanki owned British Bank regulated
>by the UK FSA) or Kaupþing Singer Friedlander (a Kaupþing owned British Bank
>regulated by the UK FSA).
>
>The real question so far as the Local Authorities are concerned is why did the UK
>Govt let these 2 British banks fail when they bailed out Royal Bank of Scotland
>and Lloyds with, potentially, hundreds of billions of pounds of taxpayers money.
Yes it is good question.
The answer of course comes from political direction.
All UK banks other than Icelandic owned ones got access to UK liquidity schemes. It was convenient premediated attack on Icelandic banks to draw away attention from horrible RBS, HBOS, etc. problem at home for Brown Darling.
Also in months prior swap agreements with US Federal Reserve, ECB and Bank of England were applied for by Icelandic Central Bank but turned down. Iceland is only western nation that did not get such swaps.
Thus the interest in talking to Russia. Russia and China are likely to be useful friends as trade partner in future but they are not our natural ally. Nordic country and UK are.
Daniel Hannan earn Conservative party in UK good will from Icelander — at least he came out in support of Icelander.
But we will see what David Cameron government policy will be next year when finally New Labour is kicked from power.
Bjarni. It’s been quite comical watching the excuses and delaying tactics pouring out of the IMF. Pencilled in rather than firm, loans approved but need to now be approved by the board, etc.
Whilst looking into the Nordic loan holdup (nothing new to report there), I found this:
http://www.ministryoffinance.is/news/nr/12286
IIRC, your best guess for the IMF loan rate was ~2%. I had assumed that the Nordics were on the same terms, but they’re actually on 3m EURIBOR +2.75%.
It’s both quite funny and sad to see the MoF give an example of the current rate situation, which is about 3.8%. They neglect to mention that the EURIBOR is at a historic low. Except for this year, it’s not been below 2% in the past 10 years, and by-eye & excluding this year the mean looks to be 3.5%.
So the Icesave loan rate isn’t unusual, as even the friendly Nordics are looking at a minimum of 4.8% once the EURIBOR returns to normal. Although I think the UK & NL missed a trick here. Why dind’t they agree the same rate as the Nordics? Even at the current low EURIBOR, it would still cover the UK cost of borrowing (admittedly with no risk premium).
Or have I missed something?
10 year 3m EURIBOR graph:
http://www.homefinance.nl/english/international-interest-rates/euribor-rates-3-months.asp
Bjarni – A more legalistic response to the “force majeure” idea is in paragraphs 51 to 54 of the UK’s submission last November:
http://www.island.is/media/frettir/28.pdf
To Terry,
>>>>if Icelanders do not fulfil their obligation – it would mean that others paying the price of miscreant banks within their own countries would have to pick up your burden also.
What will most likely happen, is that Iceland will end up paying the original IceSave guarantee amounts, and then some part of the interest payments, irrespective of current negotiations results. The rest of the interest will need to be written off, either because of the amendments or to avoid sovereign default of Iceland.
>>>>This does not mean that Iceland should get a ‘get out of jail card’.
You can rest assured, what Iceland is going through does not in any way feel like ‘get out of jail card’.
To Jim:
>>>>I disagree.
I told you :-)
>>>>The UK’s deposit guarantee scheme, for example, successfully handled several simultaneous bank failures.
Just because you have not yet had all your largest banks fail (e.g. HSBC, Barcleys, Lloyds) in the same week, does not prove your deposit guarantee scheme would be able to pay out all their deposits.
Note also, the UK government was able to avoid paying out the deposits of HBOS by having Lloyds taking them over, Bradford & Bingley by Santander, and RBS by taking it over by themselves. The only ones they really had to pay out the deposits for were Northern Rock, few smaller ones, and then of course the Icelandic banks :-).
>>>>Remember that Iceland failed to regulate its deposit taking activities such that it could satisfy its guarantee obligations. It’s that simple (ie the state’s ability to cover the guarantee should limit the deposit taking).
It may sound simple, but I know of no western country that actually has done this. If you know of any specific case where the country has limited deposit taking by their largest banks so the amounts would be within their government ability to pay the guarantee, I would be very interested in seeing the documentation for this.
To Bromley86:
>>>>Or have I missed something?
I don’t think so. It looks like the only real friends we have are the Faroe Islands :-)
I agree that we should not hinge on language as at least three languages involved in the case. But my point was and is that this matter is not for the discussion by few.
According to language at icelandreview it’s confidential now.
But it’s irrelevant whether this is “permitted”, “allowed” or “confidential”. THIS IS NOT private matter among private parties. This is national matter. If someone wants me to pay to him – I want to know all details. If someone want to keep something “confidential” – I would be more then happy to send him my “confidential cheque” :-)
100% agree with Alexander.
This is a jocke acctually they are laughing in our faces, its been almost 5 day now and absolut silence, what shoks me the most is the TOTAL and absolute controll aver the media, not a single note about the situation, and even worse, nobody even asks in the media, I find it amazeing, and then we want to protest after they make the decition, why isn’t anybody asking questions, “whats going on?” “its been 5 day and no coments” “what are they doing?” “what are they talking about?” “who are they talking with?” it is like there is no case, the Icesave case doesnt even exists. They said that they asked for confidencallity and we are very respectfull of that.
>I don’t think so. It looks like the only real friends we have are the Faroe Islands :-)
At the risk of looking like I’m trying to depress you, wasn’t their loan at 5.25%?
http://www.icenews.is/index.php/2008/12/20/faroe-islands-give-green-light-to-iceland-loan/
Poppycock.
Heritable’s parent was already insolvent and effectively nationalised. KSF was facing a massive run.
@Barni
Perhaps you are right. Personal i prefer friends for free, not bought by money. There are no cheap loans – and free loans might be the absolute most expensive.
If the oposition in Iceland don´t accept the program through IMF – then OK, but the Nordic loans are still based on this and accepted by the Nordic governments/parliaments. We can of course change that, but it depends on political processes in the four countries. You know – it is not only Iceland that have to give guarantees on these loans…
SV/DK/NO have already put some money in the pot through swap-agreement from May 2008, probably after Iceland was asked to go to IMF in February 2008.
I don´know if all politicans in Iceland want foreign help/loans at all. There will always be some that benefits from the situation today.
-
Perhaps the best description of “best help” is said in this song “Eg ser”, written by Bjørn Eidsvåg – sung by Sissel Kyrkjebø. It has english subtitles.
http://www.youtube.com/watch?v=WSxCxXHmkfk
If you need friends, you need to thrust them.
To Jim:-
I remember 30-odd years ago when ace negotiator Roy Hattersley turned down the Icelandic offer re fish quotas, in the belief that he could obtain a better deal. He did, but the better deal was for the Icelanders, who managed to get away with giving the UK a fishing quota of zero tons instead of the 45,000 (if I remember rightly) tons a year which the Icelanders had offered.
If I have learned only two things from 38 years of visiting Iceland (the most important thing I learned is to say já takk to everything when seated at the dining table), the second most important thing is that if Icelanders think they are really really being pushed beyond a point where honour/pride demands they dig their heels in, then dig their heels in they will even if in practice they are cutting off their noses to spite their faces.
I think that point has been reached with Icesave. If the UK and Dutch govts don’t take what has been offered, then they could very easily end up with zero, no matter what it costs the Icelanders.
To Anybody Else Who Might Be Interested:-
So far as the UK deposit scheme is concerned, there was nowhere near enough money in it to guarantee all the retail deposits in the UK banking system, and it has been able to pay out only because the UK govt has lent money (I think it’s around £20 billion) to the scheme to enable it to meet its obligations. This means that the institutions covered by the scheme will have to pay collectively around £1 billion a year into it over Lord knows how many years so that the scheme can repay HMG.
Øystein – Norway could potentially provide the Icesave loan guarantee past 2024. There’s a good chance Norway wouldn’t ever have to pay anything. And all the lending countries and institutions around the world would remain content that the modern principle of sovereign debt obligation was still being respected and no potentially-destabilising precedent had been set.
Mike – I stand corrected: you’d make an excellent negotiator….for the Icelandic cause :-)
“If you know of any specific case where the country has limited deposit taking by their largest banks so the amounts would be within their government ability to pay the guarantee, I would be very interested in seeing the documentation for this.”
Bjarni – Just a simply ratio ( total consumer deposits / GDP ) for each country would probably reveal a lot. Refine the numerator by adding any national debt and subtracting any major assets that could be securitised and sovereign wealth funds. Then short the currency of the country at the bottom of the list; damn, too late… ;-)
To Bromley86:
>>>>At the risk of looking like I’m trying to depress you, wasn’t their loan at 5.25%?
I had heard something about a different lower rate before, but it sure looks like this is correct. But, and this is important, the loan offer from Farou Islands was immediate, and with no strings attached. Just that they are still there for us and willing to do their part to help, was noticed by everyone in Iceland.
To Øystein:
>>>>Perhaps you are right. Personal i prefer friends for free, not bought by money.
I do not think anyone would call the help by the Faroe Islands, “friends bought by money”. We are simply in the dire situation of having lost approximately 100% GDP, and are now being forced to pay another 30-50% of GDP, for something we get will get no economic benefit. This means unfortunately, that the outside help we need will have to be mainly financial in nature.
I think their loan offer from Faroe Islands was a genuine offer support and friendship. Please note that, Faroe Island (population 50000) is even smaller than Iceland, so for them 40 million Euros is a very significant amount of money.
The other Nordic countries and Poland/Russia have of course been very helpful in offering their loans, but by holding back finalizing them until IceSave is fully resolved, they are being USED to apply pressure on the Icelandic government to accept a punitive loan agreement, that most of the population does not agree with.
Bjarni, I haven’t heard about any loan from Russia. Only talks about it.
I’ve travelled in Iceland and the people are so unfriendly. Putting the blame on just the Banks is not all true. Its greed from unfriendly people that got this country in so much trouble, the only thing that is going to get you out of this hole is tourism smarten up Iceland…
To Alexander E.
>>>>I haven’t heard about any loan from Russia. Only talks about it.
Yes, its definitely still only discussions so far, but it suddenly came back into the news few days ago.
http://www.mbl.is/mm/frettir/innlent/2009/09/20/russalan_innan_seilingar/
http://www.austurglugginn.is/index.php/200909202230/Landid/Ymislegt/Sendiherra_segir_Russa_vilja_adstoda
Both articles are in Icelandic, but it sounds like the Russian ambassador wants to get back in the play. He is complaining in the interview that certain Icelandic politicians are too suspicious of Russia motives.
David,
There is plenty to criticize about Iceland but in my opinion the people are certainly not unfriendly. I visited Iceland last november, just after the start of the crisis and I only had good experiences, not only in the hotel and in restaurants, but also in the streets or when visiting attractions. Some people whom I asked directions even got out of their way to help me and I found people honest too.
I have told enthusiastic stories about Iceland to my colleagues and this summer two of them went to iceland too…and they were pleased as well. At the moment a ticket from Holland to Iceland is less than 200 euro all-in and everything has become really affordable with a rate of 180 kr to the euro.
Hope to go back there next summer.
To Bjarni
As you well aware the Russian ambassador has nothing to do with the Ministry of Finance (where all loans come from). I don’t know what the heck he’s talking about.
But Iceland is off the Russian radar for sure. At least none of the top financial executives mentioned anything about Iceland and loans.
BTW the exchange rate between ISK and RUB is same as a year before. That means both currencies are falling at same speed ;-)?
Niels said:
“At the moment a ticket from Holland to Iceland is less than 200 euro all-in and everything has become really affordable with a rate of 180 kr to the euro.
Hope to go back there next summer.”
Its still a very expensive place to visit – isn’t it?
As for the friendliness of the people – I hope they are not reflected by the attitude displayed here.
Peter,
Iceland is off course not a cheapy, but it is definitely not as expensive as before the kreppa when things (tickets, meals, hotels) were at least twice as expensive as in Holland.
I remember paying some 1000 kr for a bottle of booze at the airport (at a rate of 160 kr to 1 euro) and we paid less than 400 euro for ticket + hotel during 5 nights.
That is comparable to other city trips in Europe.
I definitley recommend seeing the country because it is a unique place and in my experience people were ok.
Don’t worry Peter. You will be more then welcomed. And you’ll get special treatment if you pay in cash pound :-)
It was something wrong with David, not with people here.
“As for the friendliness of the people – I hope they are not reflected by the attitude displayed here.”
No one is blaming British or Dutch public for anything, our governments are responsible for the problems we are going trough along with the people who run things behind the curtains,
the general public has very limited influence,
it takes protests, riots or civil wars to make a difference,
you are more than welcome in Iceland, lots of Brits live here and have no problems at all,
Iceland has not changed and i hope it never will.
http://www.youtube.com/watch?v=oxIHuD1ITcs&feature=fvw
Niels, listen to what the old guy says at the end of the video ;)
happy to hear that you liked Iceland.
Nice vid Axel.
Here there is also no blaming of the icelandic people. In fact I saw a tv report of some dutch people who went to iceland, shortly after Icesave failed, trying to recover their money.
They did not know anything about Iceland and many of them had lost their savings…but still they were impressed by the icelandic people and felt sympathy for them.
These people had more heart than Haarde…who basically said that people who had lost money in Icesave should get lost.
Niels said:
“These people had more heart than Haarde…who basically said that people who had lost money in Icesave should get lost.”
—————————————-
Whilst I have absolutely no agenda for Haarde, that statement is disingenuous.
Haarde stated this bare undeniable fact,
“total debts of the Icelandic banks had become higher than the national economy could sustain and that Icelandic authorities were therefore unable to cover all debts”.
In that context he went on
“But of course we will undertake it is such a way that claimants are not being discriminated against, regardless of their nationality, and committees [on behalf of the Financial Supervisory Authority (FME)] and those who are responsible for the operations of the banks now will have to sort it out,” the prime minister said.
“It is first and foremost its reputation that we want to protect. We do that, among other things, by saying honestly to people: Iceland’s state treasury cannot be responsible for paying all of the debts which private companies in the financial market—the banks—have piled up.”
Knowless,
It is nice to dish up a rather statemanly speech made by Haarde, obviously to the icelandic public.
But I am talking about the perception which the dutch public got back in 2008:
it was like this and differs strongly from the very reasonably-sounding speech which you are quoting (and I do not know where and when Haarde spoke like this) :
http://www.volkskrant.nl/economie/article1075780.ece/IJsland_laat_Icesave-klant_in_kou_staan
The title means: “Iceland lets down icesave-customers.”
it is in dutch but the crucial passage is:
“De IJslandse regering liet de Britten woensdag aanvankelijk weten dat zij ‘geen enkele intentie had’ om haar verplichtingen in Groot-Brittannië na te komen.
Nadat de Britse regering met een rechtszaak had gedreigd, zei de IJslandse premier Geir H. Haarde later op de dag dat de Britse claims prioriteit hebben.
De premier zei geen gesprekken te voeren met de Nederlandse autoriteiten. Op de vraag wat Nederlandse Icesave-spaarders te doen staat, antwoordde Haarde: ‘I’m very sorry for them.’
”
with google translate (and some modifications) this translates as follows:
The Icelandic government told the British last Wednesday that it “had no intention at all” to its meet obligations in Great Britain.
After the British government had threatened a lawsuit, the Icelandic Prime Minister Geir H. Haarde said later during the day that the British claims have priority.
The Prime Minister said there are no talks with the Dutch authorities. Asked what Dutch Icesave savers should do, Haarde said: “I’m very sorry for them.”
+++++++++++++++
This was the icelandic reaction at the beginning of that crisis as it was quoted all over the dutch press (not just in the source I am using).
it makes a rather different impression than the speech you are quoting.
Now that I was searching the web I came upon the following article which I would like to add to this thread . I do not know what to think of it myself, but leave others to judge:
http://www.nu.nl/economie/2089317/icesave-spaarders-zetten-aanklacht.html
google translate does not make too much sense, I tried to repair (sorry for the remaining mistakes):
”
Icesave savers continue indictment
RIJSWIJK – Icesaving, the Dutch association of wealthy savers who have been let down by the collapse of Icelandic savings bank Icesave, have started the indictment of the Government of Iceland.
The association accused the Icelandic government of discrimination against foreign savers.
According to Icesaving the Icelandic Government last autumn broke European rules by only giving Icelandic savers of the bankrupt parent bank of Icesave, Landsbanki, the entire access to their savings.
Injured Dutch savers got their funds to a maximum of 100,000 euros compensated.
Conversations
Icesaving already announced the indictment in early May . According to a spokesman the association seemed to come to an agreement with the Icelandic government, but the icelandic side
broke off the talks in July.
The interest group is to launch the complaint with the European Free Trade Association. Proceedings could take three years.
“
To Niels:
>>>>The Icelandic government told the British last Wednesday that it “had no intention at all” to its meet obligations in Great Britain.
This quote is sounds much more likely to have come from Alistair Darling, than Geir Haarde. Here is the actual quote from Darling:
“The Icelandic Government have told me, believe it or not, have told me yesterday they have no intention of honouring their obligations there”
Darling has never been able since then to point out the quote or the exact person in Icelandic government that actually said this. So if the Dutch want to be mad at anyone specifically over this quote it should be Alistair Darling, not Geir Haarde.
Bjarni,
This quote appeared all over the dutch press at the start of the kreppa.
I cannot judge if Haarde exactly said this (probably t has been derived from the infamous phone conversation between Mathiesen and Darling).
However it is a fact that he made it clear, in a press conference to dutch journalists, that Iceland was not intending to do anything for people who had become victims of Icesave.
He may have used some diplomatic politicians speak but his message was clear: we are sorry for you , get lost, british claims have priority.
This was not very helpful for the icelandic image in dutch public opinion as you can imagine.
Now I do realize that at least he was honest in the sense that Iceland was (is) in no position to give compensation but this does not relieve him from the responsibility he had:
-allowing the banks to outgrow the abilities of the icelandic authorities
-not having any contingency plan
-allowing the ‘bussiness vikings’ to start all kinds of unsound adventures
-encouraging the icelandic public to borrow,borrow,borrow
and…when the kreppa started, some very bad crisis management (see above) making things only worse.
And I do not think Darling should be blamed for this.
“this does not relieve him from the responsibility he had:
-allowing the banks to outgrow the abilities of the icelandic authorities
-not having any contingency plan
-allowing the ‘bussiness vikings’ to start all kinds of unsound adventures
-encouraging the icelandic public to borrow,borrow,borrow
and…when the kreppa started, some very bad crisis management (see above) making things only worse.”
I doubt anyone would disagree with that! Aren’t those some of reasons why Icelander’s topplied Haarde’s government…
To Niels,
>>>>I cannot judge if Haarde exactly said this (probably t has been derived from the infamous phone conversation between Mathiesen and Darling).
Although Geir Haarde certainly made a lot of mistakes, he cannot bear responsibility for something he actually DID NOT say. If you read the transcript from the phone call you will notice that Arni Mathiesen did not say this either (this topic has already been heavily debated here on IceNews in previous threads, so I will not try to repeat it here). Until Alistair Darling actually says who exactly he talked to and gives us exact quotes or transcripts, we will have to take these as his words, not Geir’s or Arni’s or anyone else.
>>>>However it is a fact that he made it clear, in a press conference to dutch journalists, that Iceland was not intending to do anything for people who had become victims of Icesave.
He as the prime minister of Iceland by definition cannot do anything specific for the “victims of IceSave”. That is simply not his role so you could say he was speaking the “truth”, even if you did not like what you heard. When a bank goes under, there is a specific process according to laws in Iceland that takes place. If there is a dispute regarding implementation of those laws, they will have to be resolved either through the courts.
>>>>He may have used some diplomatic politicians speak but his message was clear: we are sorry for you , get lost, british claims have priority.
I do not think he would ever had said that British claims would have priority over the Dutch, because they simply do not. If you have a specific quote where Geir actually said anything like this, I would be interested in getting more details about it.
>>>>-allowing the banks to outgrow the abilities of the icelandic authorities
-not having any contingency plan
-allowing the ‘bussiness vikings’ to start all kinds of unsound adventures
-encouraging the icelandic public to borrow,borrow,borrow
Yes, Geir Haarde as the prime minister of Iceland, will have to bear his share of the responsibility of the above points, at least over those where he had actual control.
>>>>and…when the kreppa started, some very bad crisis management (see above) making things only worse.
No debate here.
>>>>And I do not think Darling should be blamed for this.
Just like everyone else, Alistair Darling will have to bear the responsibility for his own words and actions. The freezing order of Landsbanki and handover of the KS&F deposits to ING did an enormous damage to the Icelandic economy, that now plays a major role in reducing the ability of Iceland now to cover the IceSave guarantee. If all the countries involved and the central banks had worked together towards a common solution, there is a good chance that most of this damage could have been avoided.
>Darling has never been able since then to point out the quote or the exact person in Icelandic government that actually said this.
It’d definitely based on the Darling-Mathiesen conversation, as I saw Darling stating that in a committee meeting 5 weeks after the collapse.
Now we can argue whether such a thing was said or not, and how important Oddson’s comments were, but that is what Darling has said. From memory, in answer to a statement that his “has no intention of honouring” was not supported by the transcript of the conversation, he said that he was, “left in no doubt from that conversation that Iceland would not be honouring its obligations and, indeed, it is now five weeks on and they have not done so.”
@Alex. Please find another solution other than Captcha!
To Bromley86:
>>>>he said that he was, “left in no doubt from that conversation that Iceland would not be honouring its obligations and, indeed, it is now five weeks on and they have not done so.”
This now becomes a very different thing, since he is now not quoting the Icelandic government directly anymore, but rather is here stating HIS own opinion of what the conversation really meant. It is also very clear that his understanding of what Iceland obligations are were certainly different from what the Icelandic government thought, again a matter of an opinion.
BTW, according to the Icelandic deposit guarantee laws, the TIF has the option to delay for 9 months (3+3+3), making any payments or arranging for loans to do so, after the official declaration of insolvency. This deadline will officially run out late next month, so there certainly was no obligation to start arranging payments within 5 weeks.
Niels said:
“This quote appeared all over the dutch press at the start of the kreppa.
I cannot judge if Haarde exactly said this (probably t has been derived from the infamous phone conversation between Mathiesen and Darling).
However it is a fact that he made it clear, in a press conference to dutch journalists, that Iceland was not intending to do anything for people who had become victims of Icesave.
He may have used some diplomatic politicians speak but his message was clear: we are sorry for you , get lost, british claims have priority.”
—————————————————
Niels, I think that it would have been more appropriate to offer a direct quote from the beleagured ex pm Haarde to support your contention.
I have offered you a clear quote where Haarde expressed no such bias.
We certainly have had enough of dubious interpretations of statements and have them presented as fact.
Why oh why doesn’t the EU simply assess all countries bound by EEA deposit guarantee laws to determine whether or not they have “hidden” laws to get around their obligations. For example, imagine if more countries start saying that, sorry, but they won’t return deposits because of obscure local law that no-one knew about beforehand. Let’s get all these local laws out in the open so that the EU can ban certain countries from offering certain financial services within the EU. Kinda obvious when you think about it.
Bjarni. As I said, we could spend a long time discussing whether he was correct and right to say what he said :) .
However the allowed delay has no bearing on the matter, as we are talking intentions here and not when the guarantee is honoured. On that subject though, IIRC, the EU legislation allows for a 3 month delay. Not that that’s all that important.
To Bromley86:
>>>>Bjarni. As I said, we could spend a long time discussing whether he was correct and right to say what he said :) .
I kind of agree, its probably one of those questions that never can be adequately answered. I just got started on this, when I saw the press “quotations” by Niels and how they affected the sentiments of the Dutch people.
As you may have noticed, I have this thing about opinions vs. facts, and how often the press, politicians, and people start mixing the two :=).
To Bromley86:
>>>>On that subject though, IIRC, the EU legislation allows for a 3 month delay. Not that that’s all that important.
As far as I can see the EU Directive has exactly the same wording as the Icelandic regulation:
“Article 10
2. In wholly exceptional circumstances and in special cases a guarantee scheme may apply to the competent authorities for an extension of the time limit. No such extension shall exceed three months. The competent authorities may, at the request of the guarantee scheme, grant no more than two further extensions, neither of which shall exceed three months.”
Apologies Bjarni, I was wrong.