Two councils have £3m in Iceland

Two Hampshire councils have investments totalling £3m in troubled Icelandic banks, they have revealed.

Rushmoor Borough Council said the cash was in the form of a £2m investment with Glitnir, which was 5% of its total investments of £40m.

Winchester City Council said it had £1m invested with Heritable, a subsidiary of the troubled Landsbanki.

A spokesperson said the money was about 3% of the city council's total investments of £32m.

Councillor George Beckett, leader of Winchester City Council, said the council used external treasury management advisors and had taken "account of the good credit rating of the bank at the time the investment was made".

Winchester City Council said it was backing the Local Government Association's (LGA) call for the chancellor to protect council deposits.

More than 100 local authorities have more than £840m at risk after investing in Icelandic banks.

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

The LGA insisted that all the councils involved had enough money to ensure that frontline services should not be affected.

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