Fears Kent County Council could lose up to 95 per cent of its £50m invested in the collapsed Icelandic banks have been eased.
A report by Ernst & Young, the appointed administrators to Iceland’s Heritable Bank, suggests creditors will receive at least 80 per cent of £18.5m invested in one of the financial institutions.
And there are positive signs for the rest of the cash too.
In its report, the administrators refer to financial distributions which will be made to creditors. It says: “Based on present information, the administrators projections indicate a base case return of between 70-80 pence in the pound”.
The administrators further report that if economic conditions improve it is possible the final recovery could be even higher.
And KCC chiefs have been told they can expect their first payment in late July or early August.
KCC currently has £18.35m deposited in Heritable. Ernst & Young has always indicated it expected a substantial recovery to be made.
County council chiefs are part of a five-member creditor committee, spearheading the push to reclaim the money alongside the London borough of Haringey.
KCC has additional money deposited in Glitnir and Landsbanki. It is being treated as a preferred creditor and indications are that again a substantial return of our money will be made.
Paul Carter, leader of KCC, said: “We have received a full report from Ernst & Young, the administrators of Heritable Bank, that their projections indicate a return to creditors of the Heritable Bank of between 70 and 80 pence in the pound. This is in stark contrast to the recent gloomy predictions that creditors would only get between 0.5 pence and 9.5 pence in the pound.
“We, along with 122 other local authorities, the Audit Commission, Transport for London, the Metropolitan Police, Cambridge University, two health trusts and many others, had money in Icelandic banks. This is the first tangible result from the work we have done to get this money back, which could be returned to KCC from July onwards.
“In addition, the position developing on our deposits with Glitnir and Landsbanki is looking most positive.”
POSTED: 20/04/2009 08:34:45
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