Icesave dispute and referendum

[wolf63]

I find 'big' finance pretty baffling at the best of times but have tried to understand the Icesave situation and failed.

Can somebody explain to me what happened. Nothing complicated - just a "A borrowed from B, B didn't pay back ....." type of explanation.

Thanks

Susan

[buildersmate]

Icelandic bank went bust. It had a UK arm which had been accepting deposits by British investors - both individuals and many local authorities. It had been paying top rates of interest, so was fairly popular.
UK Government refunded the British investors their money back.
Now the UK Government wants the money it forked out back from the Icelandic Government - arguing that the Icelandic government failed to regulate and control its banks properly.

[wolf63]

Okay - thanks I understand that. It seems pretty straight forward. The 'normal' investors got their money.

If things were the other way around would the UK government give the Icelandic govt its money back?

I tried reading the Wiki page before posting - but it was much too detailed and complicated.

Susan

[TCL-MUMPING]

The thing is the British and the Netherlands' governments have put forward a better deal to the Icelandic government so the referendum was about a deal that had been scrapped already.

[catmando]

UK gov't should definitely get its (ie our) money back but I don't blame the Icelanders for voting no. They will be hard hit as a result and its not their fault.