Icelandic banks - statement from Lancaster City Council's chief executive
Explaining the situation with regards to Lancaster City Council's investments in Icelandic banks, its chief executive, Mark Cullinan, said: "As part of its investment strategy Lancaster City Council currently has a portfolio totalling £24million spread across a number of financial institutions.
Explaining the situation with regards to Lancaster City Council's investments in Icelandic banks, its chief executive, Mark Cullinan, said: "As part of its investment strategy Lancaster City Council currently has a portfolio totalling £24million spread across a number of financial institutions.
"The amount invested can vary daily, given that the Council can reasonably expect between £200 to £250million passing through its bank accounts in any one year. The Council uses the investment income generated to help fund its annual budget in providing services.
"Around £6million of the current portfolio is invested in three Icelandic banks.
"At the time of making these investments, the banks concerned were reputable institutions with high credit ratings.
"These investments are not due to mature until 2009 and so, in the short term, the council does not face any financial difficulties or expect any impact on service delivery.
"We are monitoring the situation very closely and will be working with other councils and the Local Government Association to seek protection for our investments and prevent any loss to council taxpayers.
"Although all the institutions the council has invested in are rigorously scrutinised prior to being chosen, given the current unprecedented crisis in the global banking market, interim measures have now been put into place to give even greater protection to our cash balances.
"These measures include keeping any future investments with highly rated institutions based in the UK or Ireland, where Government has now given guarantees for any such investments made."
Date Updated: 19/03/09