Landsbanki to seek Two Billion Dollars from Former Owners and Management Skip to content

Landsbanki to seek Two Billion Dollars from Former Owners and Management

The winding-up committee of Landsbanki is now in the final stages of preparing a number of cases against former management and the owners according to Morgunbladid. The amount that the board asks for as reimbursement amounts to 0.75 billon USD (90 billion ISK). The board also asks for eight billion ISK insurance payment, because of criminal activity on behalf of the former management of the bank.

In happier times: Former Prime Minister David Oddsson, Björgólfur Gudmundsson, former Landsbanki chairman, former Prime Minister Geir H. Haarde

The winding-up committee last summer hired a team of specialists from Deloitte in Britain to investigate the bank before the October 2008 crash. Herdís Hallmarsdóttir, who is on the winding-up committee says that the investigation is making good progress, but is not yet finished.

“The bank (Landsbanki Íslands) had a so called D&O policy that should give protection for criminal behavior on part of the management of the bank. We are talking about criminal in the sense of damages, not punitive purposes. The policy is in the amount of 50 million Euros or eight billion ISK). We have been informed of 11 instances that we think will give rise to damage payments.”

Björgólfur Thor Björgólfsson. One of the three biggest owners of Landsbanki. Photo: Geir Ólafsson/Iceland Review

Two of the three former owners of Landsbanki, Björgólfur Gudmundsson and Magnús Thorsteinsson are now legally bankrupt. The third owner, Björgólfur Thor Björgólfsson, is still liquid. The CEOs of the bank were Sigurjón Árnason and Halldór J. Kristjánsson.

Landsbanki is the bank that opened up the IceSave accounts in the UK and Holland, giving rise to damage claims from the two nations against the government of Iceland. A settlement has been reached twice, but then first amended by Althingi, Iceland’s Parliament, and then rejected by the nation in a national vote. About 98% voted against the settlement.

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