Councils demand Iceland bank inquiry
Tuesday, 14 Oct 2008 15:06
Glitnir, Landsbanki and Kaupthing: Iceland's major banks have all been nationalised
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Local authorities across Britain are calling for a government inquiry into why credit rating agencies gave Icelandic banks high ratings.
The Local Government Association (LGA), which is spearheading the plan, said the ratings were given up until a matter of days before the banks went into administrations.
The inquiry, which would be run by the Financial Services Authority (FSA), should occur at the same time as councils which continued to invest in Icelandic banks with unacceptable rating conduct their own individual inquiries, the LGA said.
One hundred and sixteen councils are known to have deposits in Icelandic banks, with deposits totalling £858.3 million.