Page last updated at 18:12 GMT, Thursday, 9 October 2008 19:12 UK

Public bodies hit by failed banks

Cash
Councils are urging the government to guarantee their deposits

Public bodies in East Yorkshire and northern Lincolnshire have invested more than 18m of taxpayers' money in failed Icelandic banks.

North East Lincolnshire Council has 4.5m in a UK subsidiary of Kaupthing, Iceland's biggest bank, and 2.5m on deposit with the failed Landsbanki.

North Lincolnshire Council has 2m invested with Landsbanki and 3.5m in the firm's UK bank, Heritable

Humberside Police Authority has 5.57m invested in the failed banks.

The authority said it had 1m in a subsidiary of Kaupthing and 4.57m in Heritable.

'No guarantee'

In a statement the authority said: "We can confirm that Humberside Police Authority, alongside many public sector organisations, have investments of 5.57m in the Icelandic banking system.

"The money represents part of the authority's long-term reserves and we can confirm that there will be no immediate impact on frontline policing activities.

"However, it is clearly a matter of serious concern and, along with other authorities which have found themselves in this position, we are monitoring the situation closely and will continue to do so."

More than 100 local authorities across England, Wales and Scotland have money tied up in Icelandic banks.

Ministers have met council leaders and are promising "appropriate" help on a "case-by-case basis".

Gordon Brown said he was considering "further action", but the government is not offering to guarantee authorities' deposits with Icelandic banks.




SEE ALSO
Councils 'not reckless with cash'
09 Oct 08 |  UK Politics
In full: Councils facing losses
09 Oct 08 |  UK Politics
Councils' cash with Iceland banks
08 Oct 08 |  UK Politics

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