2008-11-16 :: icenews.is :: Islande: accord conclu sur les lignes directrices de garantie des dépôts

http://www.icenews.is/index.php/2008/11/16/icesave-agreed-guidelines-reached-on-deposit-guarantees/

Iceland: Agreed Guidelines Reached on Deposit Guarantees

Islande: accord conclu sur les lignes directrices de garantie des dépôts

By Thorleifur Petursson on Nov 16, 2008 in Finance and Business, Iceland, Icelandic PM´s office, MBL

PRESS RELEASE FROM Ministry for Foreign Affairs
Significant progress has been made towards solving the differences on the interpretation of legal obligations with respect to deposit guarantees in the European Economic Area. The issue stemmed from difficulties following the collapse of former privately-owned Icelandic banks, in particular the Landsbanki in the United Kingdom and the Netherlands and the issue of the so-called Icesave accounts. Talks between Iceland and several EU member states, initiated by the French EU Presidency, led to a common understanding that will form the basis for further negotiations.

According to the agreed guidelines, the government of Iceland will cover deposits of insured depositors in the Icesave accounts in accordance with EEA law. They also entail that the EU, under the French Presidency, will continue to participate in finding arrangements that will allow Iceland to restore its financial system and economy.

Furthermore, it was agreed to facilitate financial assistance to Iceland, including agreeing on a stabilisation package from the IMF. Iceland´s request for financial assistance from the IMF will be discussed at its Executive Board meeting on Wednesday 19 November.

Agreed Guidelines

1. The Government of Iceland has held consultations with the EU Institutions and the Member States concerned regarding the obligations of Iceland under the EEA with respect to the Deposit Guarantee Directive 94/19/EC. All parties concluded that the Deposit Guarantee Directive has been incorporated in the EEA legislation in accordance with the EEA Agreement, and is therefore applicable in Iceland in the same way as it is applicable in the EU Member States.

2. The acceptance by all parties of this legal situation will allow for the expeditious finalization of negotiations underway concerning financial assistance for Iceland, including the IMF. These negotiations shall be conducted in a coordinated and consistent way, and shall take into account the unprecedented difficult situation of Iceland and therefore the necessity of finding arrangements that allow Iceland to restore its financial system and its economy.

3. The EU and the EEA Institutions will continue to be involved and consulted on this process.

Urður Gunnarsdóttir
Fjölmiðlafulltrúi / Press Officer
Utanríkisráðuneytið / Ministry for Foreign Affairs
Rauðarárstíg 25, IS 150 Reykjavík
S. 545 9974, Fax 562 8746
Farsími / mobile: +354 864 9974

5 Comment(s)

1.

On Nov 16, 2008, Gray, Germany said:

“All parties concluded that the Deposit Guarantee Directive has been incorporated in the EEA legislation in accordance with the EEA Agreement, and is therefore applicable in Iceland in the same way as it is applicable in the EU Member States.”

Not to be too nitpicking, but this shouldn’t have been a controversial point. what’s controversial is if the EEA statutes obligate Iceland to finance the guarantee fund, since Haarde and his gang claim there is a loophole in it that allows them to disregard this. I see nothing in this declaration about this particular arguement, nothing about financing the guarantee fund at all, and no plan about credits to be used to pay the guarantee sum to depositors.

Hmm, maybe I’m too suspicious, but I’m really underwhelmed right now. Is this just another smoke screen, like that infamous letter ot the UK treasury, which actually promised nothing???
2.

On Nov 16, 2008, theblob said:

I wonder we the central bank of Denmark and Sweden got cold feet? The politicians of both countries said they would offer assistance but any decisions would be taken on the level of “public servants”
First they somehow tied the loans to the IMF package, when that failed the 2 central banks seem rather pleased somehow.
Could it be that the central banks of Denmark and Sweden would entrust Sedlabanki with a free kebab? Simply because they doubt Sedlanbanki have the competence needed to run a central bank? Any offers?
3.

On Nov 16, 2008, orchafine said:

There’s no point to fight with Haarde any more. He is done!
At least this situation showed to the world how dumb he is… Hope the EU keeps him and his friends under control though.
4.

On Nov 16, 2008, Physchim62 said:

“We accept the EU directive on deposit guarantees and will undertake the obligation to pay what Landsbanki assets will not cover” is the quote from the Ostrich Haarde. Of course, everyone else thought they accepted it in 1999 (Law 98/1999 of the Althing), when the Finance Minister was a certain Geir H. Haarde…
5.

On Nov 16, 2008, Bjarni said:

I kind of agree, there is nothing really new in this press release. Everybody just agrees that the 94/19/EC Directive applies, which really never was in question. It was the interpretation of it that was always the question. Maybe the wording “in the same way” means something significant.

The news here in Iceland this evening was though, that this would mean that all the IceSave accounts would indeed be guaranteed up to 20K Euros by the Icelandic government.

I think its likely that everybody has reached some kind of political agreement, that they simply do not want to put exactly down on paper, at least not yet.

Things could get interesting though, when the Icelandic government will try to pass new laws in the parliament, that would be necessary in order for Iceland to accept any new obligations. It is quite likely many of the MP´s both in the parties that support the government and of course also those that are against it will demand to know more before accepting anything.


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