Icelandic ‘Outvasion Vikings’ took huge loans in the UK

landsbankiThe total loans of failed Icelandic bank Landsbanki in the United Kingdom to fellow Icelandic businessmen amounted to a minimum ISK 130 billion of a total loan portfolio of around ISK 730 billion.

By far the biggest single loan paid out by Landsbanki UK went to Novator Pharma, a company owned by Bjorgolfur Thor Bjorgolfsson (son of Landsbanki’s biggest shareholder) and companies associated with Baugur Group (huge retail chain with Icelandic media empire including Stod 2 and Frettabladid), Stod 2 News reported.

The majority of money loaned went to non-Icelandic businesses; but by far the biggest individual loans all went to Icelanders. For example, Novator received a loan from Landsbanki in the UK for GBP 205 million, whereas the highest loan to any non Icelandic company was GBP 58 million.

Novator’s outstanding debt to Landsbanki stands at ISK 40 billion and the debt of Baugur Group and associated companies is ISK 58 billion. The loan to Novator was taken to finance its takeover of Actavis, which is now responsible for the loan.

According to Frettabladid sources within Landsbanki, the loans to Novator and Baugur were secured with the best possible collateral the companies had to offer at the time. Of the total loans given out by Landsbanki in the UK, Icelandic companies got 18 percent.

Frettabladid sources point out that the figure is reduced to 12-15 percent if the loans from Heritable Bank are included. Heritable was a Landsbanki subsidiary which only loaned to British companies.

In the meantime, the agreement reached with Dutch and British authorities over Icesave reimbursements was greeted with hostility by the opposition in parliament yesterday and by protesters outside.

While the contract commits the government and the Icelandic people to shoulder the responsibility for Icesave, the liquidation of Old Landsbanki assets in coming years is hoped to cover much of the debt. The amount of debt held by failed Icelandic investment companies is, therefore, of direct consequence to all Icelandic residents.

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