Dutch, German and British loan to Iceland

Dutch talksA spokesman for the Dutch Ministry of Finances said earlier today that Dutch authorities will grant Iceland up to 1.3bn euro, MBL reported. The condition for the loan is that the money is used for paying IceSave depositors.

According to Dow Jones, the loan is a part of the 5bn euro loan package that British, Dutch and German authorities will grant Iceland. The majority of foreign depositors in Icelandic savings accounts come from these three countries.

The loan was contingent on the approval by the IMF of a 2.1bn US dollar loan last night (about 295bn Icelandic krona). The Danish, Finnish, Norwegian, Russian and Polish governments will loan Iceland another 3bn US dollars.

In the agreement that was announced last week it is stated that the Icelandic government guarantees the minimum insurance amount which EEA regulations stipulate for depositors in foreign branches of international European banks. The EU continues to search for a solution that would help Iceland restore the financial system and economy.

Arni Mathiesen, the Icelandic Minister of Finances and Dutch authorities had already come to an agreement for a loan of 1.1bn euro. This sum has now risen to 1.3bn euro (about 230bn Icelandic krona).

This amount has risen because Iceland needs to pay IceSave depositors up to the first 20,887 euro in every depositor account.

German, British and Dutch governments promised their help to Iceland under the condition that the IMF approved the loan of 2.1bn US dollars, the three nations informed in their joint statement. The IMF loan was approved last night.

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