CASH-STRAPPED Nuneaton and Bedworth Borough Council has received nearly £1 million back that it invested in an Icelandic bank which collapsed.
The local authority has confirmed that it has been re-paid a first instalment of a whopping £900,000, which amounts to one third of the total amount owed from Landsbanki.
Councillor Dennis Harvey, leader of the borough council, said: “This is a tremendous result for our authority. It has been a long and difficult process but our patience has been rewarded.”
Back in 2008 the devastating news was dealt that the banks, which go under the name Landsbanki, had gone into financial meltdown and the council had invested a massive £3 million of `capital’ money.
But it was granted preferential creditor status on the deposits by the Icelandic District Courts, which meant that the council’s claim, and that of other authorities around the UK, would be given priority status and paid back first.
It is not yet known when the next instalments will be paid, but council officers will be working with the Local Government Association (LGA) and appointed solicitors to secure the remaining cash as soon as possible.
Cllr Harvey added: “We are committed to making sure all of our claim is returned to us and will continue to work hard to make this happen as soon as possible.”
The decision of the Icelandic District Courts to grant the council preferential status followed a previous ruling late last year by the Icelandic Supreme Court.
The supreme court ordered that deposits from UK authorities should be given priority over other claims that stemmed from the collapse of the banks more than three years ago.
It is expected that Nuneaton and Bedworth will recover approximately 95 per cent of the total that was deposited in the bank.
The way in which the borough council has co-ordinated the legal action in the battle for the cash, along with the LGA and other local authorities, has minimised the legal costs.
The cost of the litigation to date amounts to less than one per cent of the total amount the council expects to recover.
