Iceland Considers Selling a State Share in Landsbanki Skip to content

Iceland Considers Selling a State Share in Landsbanki

The government of Iceland is considering selling an 18.7 percent part of the state’s share in the bank Landsbanki Íslands. The share is currently in the safekeeping of the Landsbanki resolution committee but should go mostly undivided to the state, which would make the bank almost 100 percent state-owned.

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The headquarters of Landsbanki. Photo by Páll Stefánsson.

Minister of Finance Steingrímur J. Sigfússon told Fréttabladid yesterday that the state will acquire the share once accounts have been settled between the old and new Landsbanki.

“It is a fairly large share against which there is no debt so it would deliver pure profits for the state if we choose not to increase its share in the bank,” he said.

The minister has voiced his opinion that the state should not own more than 75 percent of Landsbanki. It has also been mentioned that the state might sell its entire 13 percent share in Arion Bank (formerly Kaupthing) and five percent in Íslandsbanki (formerly Glitnir).

Furthermore, it is planned to sell various real estate properties which have come into the state’s ownership. However, the state will keep its shares in the Icelandic savings bank for now.

Sigfússon said the next step is to form a political policy on these items, looking towards Norway’s experience of running state-owned banks. He stressed that the matter is in the preliminary stages.

“You can be certain of one thing,” the minister added, “the work methods from 2002 will not be repeated,” referring to the time when the state-owned banks were initially privatized.

According to ruv.is, even though the government’s policy on the state’s role in the banking system hasn’t been fully outlined yet, it is assumed in the new budget bill draft that the state’s share in the banks will be sold to help with the deficit.

Other measures to that effect mentioned in the budget bill draft are cutbacks in public operations by three percent, 1.5 percent of which applies to healthcare and education.

Taxes on large-scale companies are also to be increased, as well as the fishing permit fee, which has been loudly protested by those involved in the fishing industry.

“We’d like to emphasize that if the fishing industry is successful, that delivers to the nation,” Fridrik J. Arngrímsson, managing director of the Confederation of Fishing Vessel Owners (LÍÚ), told Fréttabladid.

ESA

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