Iceland approves plan to reimburse UK's £3.4bn Icesave losses

Iceland's parliament has passed the "Icesave" bill, approving a £3.4 billion repayment plan to compensate Britain and the Netherlands for money lost after the collapse of an Icelandic internet bank previous year.

Iceland will start reimbursing £2.3 billion to Britain and £1.1billion to the Netherlands from 2016, with payments stretch over following 9 years.
 
The Icelandic government had to face heavy opposition to approve the concerned plan.

The British and Dutch governments had to reimburse the money to around 320,000 customers of the bank's Icesave subsidiary after the collapse of the bank’s parent company last October.

Out of the total members, 34 voted in favour, 14 against, while 14 abstained.

Iceland’s Prime Minister, Johanna Sigurdardottir said the approval of the plan allowed Iceland to honour its international obligations.

It may be noted here that Iceland must settle the claims before it can draw on promised $4.6 billion bailout funds from International Monetary Fund.

UK’s Treasury spokesman said, "The UK supports the Icelandic government's effort and commitment to the loan and to meeting its obligations to UK depositors covered by its compensation scheme."