Uncertainty over council's Iceland cash
There is no certainty over how much and when rate payers' cash invested in Icelandic banks will be repaid, according to a report to Breckland council. Breckland, which invested �12m in Icelandic banks, is to consider how it manages its investments - including proposals to reinforce its policy of putting financial security before making money.
There is no certainty over how much and when rate payers' cash invested in Icelandic banks will be repaid, according to a report to Breckland council.
Breckland, which invested �12m in Icelandic banks, is to consider how it manages its investments - including proposals to reinforce its policy of putting financial security before making money.
Moves already made by Breckland include taking cash out of one of its Irish bank accounts after recent uncertainty over banks there.
It still has investments there that cannot be withdrawn until summer, according to a report.
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It comes as the council still does not know when and how much of its �12m in Icelandic banks it will get back.
The report to the cabinet meeting on Tuesday says: “We anticipate that a percentage of the debt will be repaid, but at present there is no certainty around the amount or timing.”
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Following the financial uncertainty in 2008 the need for a “security-biased” approach to investment had been increased, it says.
And liquidity of cash should come second and making cash third.
The council had already made changes to its investment policy following advice from Butlers, who advised a number of the councils who have cash in Iceland banks.
Further changes had been made as a result of the “Iceland banking difficulties”, the report said.
Options being put to the cabinet include the finance officer taking a more restrictive operational approach until the banking system “returns to more 'normal' operations”.
Banks or building societies thought safe would be favoured for investments.
Cash in an instant access account with Allied Irish Bank has already been transferred to the Royal Bank of Scotland and the Yorkshire Building Society, the report said.
It added: “The Icelandic banking situation still remains uncertain at this time. Claims have been registered with the administrators of the banks and we are a member of the local government creditors group for Glitnir bank, so we are able to follow the progress of our claims.”