The Treasury has recovered a further £1.36bn from the estate of Lansdbanki, the Iceland-based bank that collapsed during the financial crisis.
Landsbanki operated in the UK through Icesave, an internet-only savings scheme which was governed under European single-market rules. This meant that when Landsbanki went bust in October 2008, account holders were not fully covered by British and Dutch deposit insurance.
The UK Government bailed out savers and became the bank’s largest creditor. The Government has now recovered £3.82bn, 85 per cent of the £4.5bn it was owed by the firm.
Treasury economic secretary Andrea Leadsom says: “The failure of the Icelandic banks cost taxpayers billions of pounds, with no certainty of ever getting the money back.
“We remain committed to recovering the full outstanding amount of the British taxpayer’s claim from the Landsbanki estate, and will continue to work hard to make this happen as soon as possible.”
The Government expects to get the full £4.5bn back from the Landsbanki estate in 2017.