In the interview, which was broadcast on the Icelandic news programme Kompas on Monday night, Bjorgolfsson revealed that the day before Landsbanki was nationalised in Iceland, the UK Financial Supervisory Authority had offered to accept Icesave deposits under a British guarantee within 5 days, provided Landsbanki submitted GBP 200 million in collateral from the Icelandic Central Bank.

Bjorgolfsson suggested that the Central Bank’s refusal to grant Landsbanki the loan, which would have allowed them to accept the British offer, might have been the trigger behind the seizure of Icelandic bank assets in the UK which many believe led to the total collapse of the Icelandic banking system.

According to Bjorgolfsson, the Icelandic government therefore bears considerable responsibility for the collapse of Icesave and for plunging the country into an international dispute.

“Icesave could have been tackled very differently, “said Bjorgolfsson. “The Icesave issue would not be a problem, but part of a solution to the crisis that has now hit Iceland. And by that I mean that in a crisis like this, the responses to the problems are actually more important and have greater consequences than the problem itself”.

In Bjorgolfsson’s opinion the Icelandic Central Bank could have prevented the uncertainty surrounding the Icesave deposits in the UK and the subsequent clash between Iceland and Britain which caused considerable damage to Iceland’s reputation in the UK.

The Icelandic Prime Minister Geir Haarde and Minister of Industry Ossur Skarphedinsson have both denied knowledge of the British offer. The Central Bank has responded by saying, “the reason for Landsbanki’s request [for a GBP 200 million loan] was outflow from deposit accounts. An express treatment by the British Financial Supervisory Authority was never mentioned.”

Bjorgolfsson has rejected these claims, saying that “the directors of the Central Bank had full knowledge of the British Financial Supervisory Authority’s offer to fast track the loan and that can also be confirmed by others. Government ministers who have been solving the problems of Icelandic financial companies were also aware of the offer made by the British authorities.”

Sources: Morgunbladid, Iceland Review, Frettabladid, Kompas

Mbl.is reports that when the Central Bank lowered interest rates on the 15th of October, economists were warning that the decpreciation of the krona would encourage further inflation in the country. They argued that tt would have been a dangerous situation to have interest rates under the rate of inflation and ultimately this would cause considerable inflationary pressure.

Inflation in Iceland rose by 2% in October to 15.9% year on year.

In August, USA TODAY picked Iceland as one of the Top 5 destinations for travel in Fall 2008. Since then the dollar has become even stronger against the krona, increasing in value by over 25%.

Icelandair is inviting passengers to take advantage of the exchange rate by offering round trip flights to Iceland from Boston or New York for $399. The ‘Winter Airfare Special’ is valid for travel from November 1st 2008 to March 31st 2009 with all flights booked by October 31st.

The Icelandic airline also has vacation packages from Boston which include round-trip airfare, discount shopping card, 3 nights at the Hilton Reykjavik Nordica with breakfast and free shuttle service to the old town and the Kringlan Mall.

The ‘Iceland Winter Frenzy’ package starts at $559 and is valid for travel between November 1st and December 15th 2008. The package must be booked by October 31st 2008.

For more information on Icelandair special airfares and packages to Iceland, visit www.icelandair.com.

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For long term deposits, Fixed Rate Bond Issue 46 is a 1 year bond which pays 6.70% interest on maturity or 6.50% (6.70% AER) monthly.

For short term deposits, Fixed Rate Bond Issue 47 offers an interest rate of 6.00% fixed for 3 months, with interest paid on maturity. Both bonds are available for balances over £5,000.

Bradford & Bingley International is now part of Abbey and the Santander Group, which has an AA/Stable rating from Standard & Poor. Deposits with the offshore savings bank carry the full and unconditional guarantee of Abbey.

Managing Director John Pearson said, “With the recent reduction in Bank of England Base Rate to 4.50% these bonds represent a great opportunity for savers in what are difficult times. The added security offered by Abbey’s take-over of Bradford & Bingley International will give savers that all important peace of mind as to the safety of their deposit.”

More information on Bradford & Bingley International’s fixed rate bonds can be found at www.bbi.co.im or by calling + 44 (0) 1624 695000.

Note to editors

Information about Bradford & Bingley International can be found at the following web address – www.bbi.co.im

EU Savings Directive rules apply to EU resident depositors.

AER stands for the Annual Equivalent Rate and illustrates what the interest rate would be if interest was paid to the account once a year.

Under Isle of Man legislation, deposits made with an Isle of Man office of Bradford & Bingley International Limited are covered by the Isle of Man Depositors Compensation Scheme.

Bradford & Bingley International Limited is registered in the Isle of Man No. 052221C. Registered Office: 30 Ridgeway Street, Douglas, Isle of Man, IM11TA, British Isles. Licensed by the Isle of Man Financial Supervision Commission to take deposits.

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The slimming aid uses chitosan, a natural dietary fibre found in the shells of North Atlantic Coldwater Shrimp (Pandalus Borealis). A by-product of the food industry, the chitosan is modified to improve its fat binding performance and solubility in the human digestive system.

Production begins with basic chitosan which is then combined with succinic acid to produce a highly integrated organic acid/fibre matrix that is easily digestible in less than 5 minutes. This is in comparison to regular chitosan which can take upwards of 2 hours to dissolve in the human digestive system.

Clinically proven to reduce body weight in humans, LipoSan Ultra is expected to appeal to consumers looking for an alternative and natural weight loss solution.

For more information on LipoSan Ultra natural dietary supplement, visit www.liposan.com.

Actavis, which has its headquarters in Reykjavik, is a leading generic pharmaceuticals manufacturer with operations in 40 countries and 11,000 employees.

The statement, released on the company’s website, says that “only 1% of Actavis’ revenues are generated in Iceland” and that it is “not exposed to the Icelandic banks in regards to funding or normal banking facilities”.

The Icelandic government recently nationalised all the country’s major banks with the Icelandic krona seeing a sharp drop in value.

Actavis states that its banking operations are with international banks that are not exposed to the current events in Iceland and that its books are in euros.

“The global financial crisis does not impact our normal course of business, and we will remain focused on providing quality products to our customers,” the statement says.

The move is a result of changes to Icelandic pharmaceutical laws which took effect from the beginning of this month. The reductions are similar to those that the company announced in May this year.

The total price reductions amount to around 200 million Icelandic kronur on an annual basis.

Some of the drugs reduced include:

• Cholesterol-lowering drug Atacor reduced by 15%. This generic drug is not available in Scandinavia but was introduced to the Icelandic market in June 2006.
• Heart drug Valpress reduced by 20%. Also not available in Scandiavia but introduced to Iceland in December 2007.
• Cancer drug Bicalutamid Actavis reduced by 15% on 1st May and a further 8% on 1st October.
• Psychotropic drug Olanzapin Actavis reduced by 16%.
• Migrain drug Sumacta reduced by 17% on 1st May and a further 10% on 1st October

Actavis says the price of its drugs in Iceland is around 35% lower than comparable drugs, and in some cases the difference can be up to 80%.

Actavis is a leading generic drug manufacturer which is based in Iceland. The company has operations in 40 countries and 11,000 employees.

The latest price list of Icelandic drugs can be found at: www.lgn.is/lyfjaverdskra.php

The annual event is expected to draw record numbers of participants, with over 1,000 people attending the day event and more than 70 companies represented at the accompanying trade show.

The conference and expo, which will be held at the Peppermill hotel and casino, is one of the most important events in the industry and is the biggest of its kind in the US.

Geothermal energy is seeing a growth in public and government interest with senators John McCain and Barack Obama both having expressed their support for geothermal power, which is a clean and renewable source of energy.

Nordic bank Glitnir will be one of the main sponsors of the event. The bank, which is a leading provider of financing and advisory services to the geothermal energy industry, will also have a booth in the Expo Hall.
Glitnir is a niche player in two global market sectors; sustainable development of the seafood industry and growth in the geothermal energy industry, with 13 percent of the bank’s loan book and 43 percent of its corporate advisory services derived from these sectors in 2007.

For more information on the 2008 Geothermal Energy Conference & Expo visit www.glitnirbank.com/reno.

Analysts had expected an increase of 14.2% in September, after a record rise of 14.5% in August. The drop was the first decline in the annual inflation rate since January 2008.

The price of clothing and shoes climbed more than 11%, causing a 0.5% rise in the CPI. The price of services also climbed considerably, or 1.1%, causing a 0.3% rise in the CPI. Thereof, the price of private sector services rose by 1.0% and the price of public sector services by 1.1%.

These figures were offset by a 0.8% decline in house prices, a 1.8% slump in the price of new cars and a 0.9% drop in petrol prices. The CPI excluding housing rose by 1.3%, bringing the annual rate to 14.7%.

Economists at Landsbanki said that Icelandic inflation peaked in August and will ease rapidly once the economy cools and the ISK has reversed its recent downward swing.

He also said that geothermal energy could clean up the air in Alaska as well as save oil and gas reserves for the future.

“Above all, you will also obtain cheaper energy for the citizens for their homes and for their businesses because the price of oil whatever happens and gas is going to go up,” said President Grimsson.

The Icelandic president is visiting Anchorage this week to attend the Northern Research Forum (NRF). The biennial meeting, this year under the theme ‘Seeking Balance in a Changing North’, will discuss issues that affect countries in the Arctic. This is the first year the forum has been held in the United States.

The Fifth NRF Open Assembly is being held in Anchorage, Alaska between 24 – 27 September 2008.

The US Geothermal Energy Conference & Expo, which is the most important event in the geothermal energy industry and the biggest of its kind in the US, will take place in Reno, Nevada, between October 5th and 8th.