Icelanders Reject Bank Bailout

bailout with magnifier on a blue background

By Anthony Faiola

Icelanders this weekend resoundingly rejected a plan to reimburse overseas depositors after the failure of an online Icelandic bank, a rare public referendum on the repayment of a foreign liability that could fuel further concerns over debt problems in Europe.

A whopping 93 percent of Icelanders rebuffed a government push to reimburse Britain and the Netherlands $5.3 billion from the October 2008 collapse of an Icelandic Internet bank. The failure led Britain and the Netherlands, the two nations where the bank had foreign depositors, to step in and partially pay back billions of euros lost by their citizens, who were lured in by the bank’s high interest rates.

The vote on Saturday, with near-final results released Sunday, captured widespread rage in Iceland over years of banking-sector excess that resulted in a financial meltdown at the height of the global financial crisis.

Continue reading Icelanders Reject Full Repayment to British, Dutch Caught in Bank Collapse

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