THE TELEGRAPH: Iceland has adopted sweeping powers in a bid to stabilise its struggling financial sector and made clear it would nationalise more banks if necessary.
Prime Minister Geir Haarde warned of “chaos” if Iceland’s banks stopped operating, and rushed through emergency legislative measures designed to stop the collapse of the Icelandic banking system.
Mr Haarde added: “A lot of the banks’ business is in Britain, so it is likely that Britain might well be affected.”
Earlier yesterday the government halted trading in the shares of six of the country’s banks. The threat is the biggest yet faced by any country over its financial sovereignty in the 14-month-old credit crisis.
The obvious implications of recent events in the “Land of Fire and Ice” are the sale of tens of billions of pounds of foreign investments, including major loan portfolios and retail assets in the UK.
The credit crisis has been particularly damaging to Iceland because its banks are so powerful in its economy, with liabilities worth almost 10 times the country’s gross domestic product.
Mr Haarde’s emergency measures include the ability to nationalise banks and a suspension of competition laws.
Last night it was not clear what Iceland plans to do with Kaupthing, the country’s biggest bank, and Landsbanki, the number two player. They could follow the third biggest bank, Glitnir, into nationalisation. Iceland Prepares to Rescue Its Banks >>> By Rowena Mason in Reykjavik and James Quinn in London | October 7, 2008
TIMESONLINE:
Bank Shares Plummet and Icesave Deposits Frozen: The global financial crisis deepened again today as shares in British banks plummeted by up to 40 per cent and 300,000 British savers were blocked from accessing their money in the Icelandic bank Icesave after it collapsed. >>> David Charter, in Luxembourg, and Jenny Booth | October 7, 2008
FINANCIAL TIMES:
Iceland Nationalises Landsbanki: Landsbanki, Iceland’s second largest bank, was nationalised on Tuesday as the country used new powers that allow it to seize control of public companies in the financial services sector.
The Icelandic Financial Supervisory Authority on Tuesday said it had dismissed the bank’s management board and appointed a receivership committee to run the group’s operations with immediate effect as the government seeks to stabilise the country’s financial system. >>> By Tom Braithwaite in Reykjavik | October 7, 2008
The Dawning of a New Dark Age – Dust Jacket Hardcover, direct from the publishers (UK) >>>
The Dawning of a New Dark Age – Paperback, direct from the publishers (UK) >>>
