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Icesave stops deposit withdrawals as Icelandic Government takes over parent

The Icelandic Government has taken over Landsbanki with immediate effect leading to Icesave stopping depositors from taking out funds.

The Icelandic Financial Service Authority, the FME, has appointed a receivership committee that has stated that the objective of the committee is to ensure the continued operations of the commercial banking operations of Landsbanki in Iceland. It also says that a public notice to debtors will not be issued.

The joint chief executives of the bank have been asked to continue in their appointments and be responsible for daily operations.

Landsbanki has not been put into liquidation but is in receivership meaning that it has temporary protection from payment of debts and obligations as they fall due.

The bank, which trades in the UK as the internet bank Icesave has stopped people taking money out or putting deposits in to the bank. Its website currently has the notice: “We are not currently processing any deposits or any withdrawal requests through our Icesave internet accounts. We apologise for any inconvenience this may cause our customers. We hope to provide you with more information shortly”.

FSA spokesperson Hedi Ashley, says that it was expecting the bank to go in to insolvency and it has informed customers on its website www.moneymadeclear.fsi.gov.uk.
“Icesave has said that it will provide more information in due course so people should wait before contacting the FSCS,” she adds. She declined to comment further.

A spokesperson for Icesave was contacted for comment but had not responded by time of posting.

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