FENLAND: Council chiefs win praise for refusing to even consider Icelandic banks
By JOHN ELWORTHY FENLAND District Council was privately counting its blessings- and its pounds- today as it was revealed they have escaped unscathed from the collapse of Icelandic banks. Finance director Mat Taylor – shortly to emigrate to Australia- and
By JOHN ELWORTHY
FENLAND District Council was privately counting its blessings- and its pounds- today as it was revealed they have escaped unscathed from the collapse of Icelandic banks.
Finance director Mat Taylor - shortly to emigrate to Australia- and Councillor Peter Skoulding shared the investments decision which ruled out putting any of Fenland's cash into the Icelandic banks.
The council is being applauded by both councillors and officers for its decision to back British and Irish banks for the council's investments - which include the £20 million from the sale of Fenland's council houses to Circle Anglia. Up to 100 local authorities across the UK may have lost- or put at risk- up to £1 billion.
I understand senior members of Fenland's finance team last year looked at- but quickly discarded- the notion of considering the attractive investment rates offered by banks such as Icesave, part of the Landsbanki group which was nationalised by the Icelandic government.
Councillor Peter Skoulding portfolio holder responsible for Fenland's finances, said: "We feel very sorry for the local authorities which have been caught up in the collapse of Icelandic banks. Thankfully, we took the decision to invest in High Street banks and building societies in the UK and Ireland.
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"We made a conscious decision to accept a lower percentage return on our money as a trade off for safer investments. In these financially volatile times, it seemed to us to that playing safe was our best policy."
A council spokesman said: "Fenland District Council has escaped the problems facing dozens of local authorities across Britain who had invested in Icelandic banks.
"The council, which has been praised for its financial prudence by the Audit Commission, chose not to snap up the additional percentage interest on investments offered by Icelandic banks. Instead, Fenland chose to invest its money in top rated UK and Irish banks and building societies.
The spokesman added: "Up until only a few weeks ago, Icelandic banks were seen as a safe investment. However, they were not seen by Fenland as safe as banks and building societies in UK and Ireland, something that was reflected in the higher interest rate being offered by the Icelandic banks.