Posts Tagged ‘Collapse’
Wednesday, April 14th, 2010
Iceland’s so-called Black Report into the banking crisis was discussed all day yesterday in parliament and heated exchanges will continue today.
The deputy chair of the parliamentary budgetary committee was one of several MPs to harshly speak out against the president for his role in the collapse.
All of parliament seems to be united in support for the report and respect for its authority – but their interpretations of it are split largely along party lines.
Among the final speakers last night was deputy chair of the parliamentary budgetary committee, Bjorn Valur Gislason, who harshly criticised President Olafur Ragnar Grimsson and his staff. He said that Grimsson had conscientiously extolled the virtues of the “Outvasion Vikings” who in turn became like old family friends at Bessasstadir, the presidential residence.
The previous government of Geir H. Haarde also came in for criticism. The report says that important decisions were often badly informed. Ministers did not give essential information to Althingi, often because they did not have it themselves. One conclusion drawn was that key figures within government simply did not trust one another.
Current Prime Minister, Johanna Sigurdardottir told Althingi yesterday that much of the information in the report is a harsh indictment on the authorities.
Three parliamentary committees have been tasked with examining the report closely and recommending improvements to the political structure. At least one of the committees is expected to hand its findings over within three weeks.
Tags: Banking Crisis, Collapse, Deputy Chair, Fallout, Family Friends, Geir, Gislason, Important Decisions, Indictment, Johanna, Mps, Olafur Ragnar Grimsson, Parliament, Parliamentary Committees, Political Structure, Prime Minister, Ragnar, Vikings, Virtues, Yesterday In Parliament
Posted in Iceland | No Comments »
Wednesday, April 14th, 2010
Minister for Foreign Affairs Össur Skarphédinsson says he is amazed at the comment by his predecessor and former chair of the Social Democratic Alliance, Ingibjörg Sólrún Gísladóttir, that she had not borne any responsibility for the banking collapse because those issues had not been her domain.
Tags: Collapse, Democratic Alliance, Foreign Affairs, Foreign Minister, Predecessor
Posted in Iceland | No Comments »
Tuesday, April 13th, 2010
The Special Investigative Commission (SIC), which yesterday presented a 2,000-page, nine-volume report on the causes of the banking collapse of October 2008, has not yet completed its work. Projects will now be passed onto other committees.
Tags: Collapse, Committees, Crisis Report, Iceland, Page Nine, Volume Report, Work Projects
Posted in Iceland | No Comments »
Tuesday, April 13th, 2010
A task force on ethical issues, which presented its findings along with the Special Investigative Commission (SIC) yesterday, said President Ólafur Ragnar Grímsson’s role in the chain of events that led to the banking collapse of October 2008 had been especially noteworthy.
Tags: Collapse, Crisis Report, Ethical Issues, Iceland, Ragnar, Sic, Task Force
Posted in Iceland | No Comments »
Tuesday, April 13th, 2010
When the Special Investigative Commission (SIC) presented its report yesterday, the committee’s chairman, Páll Hreinsson, said no one of the 147 people the SIC interviewed while making the report would take responsibility for the banking collapse.
Tags: Collapse, Crisis Report, Iceland, Sic
Posted in Iceland | No Comments »
Tuesday, April 13th, 2010
Former Prime Minister Geir H. Haarde, who is accused of negligence in the Special Investigative Commission’s crisis report which was made public yesterday, said he is pleased that the report has finally been published. But he stated that his government cannot be blamed for the banking collapse of October 2008—the banks themselves are at fault.
Tags: Banks, Collapse, Crisis Report, Former Prime Minister, Iceland, Negligence
Posted in Iceland | No Comments »
Tuesday, April 13th, 2010
The Icelandic government welcomes the report published today by the Special Investigative Commission of the Parliament on the causes of the collapse of the Icelandic banking system. Consisting of independent experts, the investigative commission was established by the Icelandic parliament in December 2008.
Tags: Banking System, Banks, Collapse, Independent Experts, Parliament
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Tuesday, April 13th, 2010
As could be expected yesterday’s release of the report into the banking collapse, commissioned by the Icelandic parliament, drew different reactions from different people.
Bjorgvin G. Sigurdsson, Iceland’s former Minister for Commerce, was one of those personally singled out for criticism. He reacted by resigning his post as chairman of the parliamentary group of Social Democrat MPs and called publicly for a national ‘high court’ to be called together to pass judgement. Sigurdsson was singled out for being negligent; but the report also stated that he had been deliberately kept in the dark on many important issues by others in government and the central bank.
Former Prime Minister Gier H. Haarde was another singled out for having been negligent and RUV reports that he could technically face two years in jail if the aforementioned ‘high court’ is called to session. Haarde said, however, that he has no fear of such a court. He told media that the report is very clear that by far the biggest share of blame must be laid with the banks themselves and their irresponsible business practices. He said the report shows the banks were already beyond saving in 2006.
Former Central Bank head David Oddsson is out of the country and was not interviewed.
Left Green leader Steingrimur J. Sigfusson told parliament that the report is the story of how Iceland’s cherished Nordic welfare state had been robbed by those wielding imported free-market, low regulation ideals. He also joined the report in criticising President Olafur Ragnar Grimsson for having been a cheerleader for the Outvasion Vikings and taking personal profit (not in direct payment) from their business practices.
Current Prime Minister Johanna Sigurdardottir said she took from the report that the banks had been run for the benefit for their biggest shareholders with scarcely a thought for customers or the average shareholder.
Tags: Banks, Benefit, Business Practices, Cheerleader, Collapse, David Oddsson, Fear, Former Prime Minister, Green Leader, Johanna, Judgement, Mps, Parliament, Parliamentary Group, Personal Profit, Shareholder, Shareholders, Social Democrat, Vikings, Welfare State
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Tuesday, April 13th, 2010
If former Icelandic ministers broke laws on ministerial responsibility with their reported negligence, they could face up to two years in prison.
The Althingi-commissioned report into Iceland’s banking collapse in 2008 accused ministers Geir H. Haarde (Prime Minister), Arni Mathiesen (Finance Minister) and Bjorgvin G. Sigurdsson (Minister of Commerce) with gross negligence in their handling of the run up to the collapse.
A committee of MPs will meet to go over the report today and prepare a response on behalf of parliament. Bjorgvin G. Sigurdsson has already requested that the committee call together a so-called ‘national high court’ to pronounce on the ministers’ alleged negligence.
Under Iceland’s laws on ministerial responsibility from 1963, ministers found to have acted negligently can face fines or prison. The head of the parliamentary committee, Atli Gislason, told RUV that this particular issue absolutely must be dealt with during this session of parliament, which ends in September.
Tags: Arni, Collapse, Face Jail, Finance Minister, Gross Negligence, Iceland, Mathiesen, Minister Of Commerce, Ministerial Responsibility, Parliament, Parliamentary Committee, Prime Minister
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Monday, April 12th, 2010
A report into Iceland's devastating 2008 banking collapse charges that the Nordic nation's former prime minister and central bank chief acted with "gross negligence" in allowing the financial sector to overheat without adequate oversight.
Tags: Adequate Oversight, Central Bank Chief, Collapse, Financial Sector, Former Prime Minister, Gross Negligence, Iceland, Meltdown, Microscope, Nordic Nation
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Monday, April 12th, 2010
Former Minister of Business Affairs Björgvin G. Sigurdsson, who resigned from his post shortly before the collapse of the Independence Party-Social Democrat coalition in January 2009, resigned as chairman of the Social Democrats’ parliamentary party after the crisis report was made public today.
Tags: Business Affairs, Collapse, Crisis Report, Democrat Coalition, Iceland, Independence Party, Parliamentary Party, Social Democrat, Social Democrats
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Monday, April 12th, 2010
The investigative committee of Iceland’s Althingi parliament has sent many cases on to the state prosecutor. Many of those are already under investigation. These include allegations that the banks’ annual reports were deliberately distorted, loans to connected parties were abnormal and that stock market investment funds were operating outside the law. There is also reason to believe that bank staff are guilty of market manipulation.
The investigation committee was obliged to inform the state prosecutor of any issues it felt constituted illegal activity – committee members handed over their findings to the prosecutor yesterday. The state prosecutor’s job is to establish which cases require full investigation and then send them on to Olafur Thor Hauksson, the Special Prosecutor hired specifically to deal with the banking crisis. Hauksson and his team are already aware of many of the issues raised in the Althingi report, State Prosecutor Bjorn L. Bergsson told RUV. He added that the Special Prosecutor will be glad of the report for the new information it contains.
Among the more worrying findings of the report is that all three of the banks held much more that 10 percent of their own shares – the legal maximum. In September 2008, Kaupthing held 42 percent of its own shares and its London branch appears to have been operating outside the control of both Kaupthing’s internal and external auditors.
Bergsson said that the report brings to light several important issues which need urgent investigative action and added that statements will follow to outline those investigations within weeks.
Tags: Allegations, Althingi, Annual Reports, Bank Staff, Banking Crisis, Collapse, Committee Members, External Auditors, Illegal Activity, Investigation Committee, Investigative Action, Investigative Committee, Investment Funds, Kaupthing, London Branch, Market Manipulation, Special Prosecutor, State Prosecutor, Stock Market Investment, Thor
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Monday, April 12th, 2010
The Icelandic government welcomes the report published today by the Special Investigative Commission of the Parliament on the causes of the collapse of the Icelandic banking system.
Tags: Banking System, Collapse, Crisis Report, Government Of Iceland, Iceland Government, Parliament
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Monday, April 12th, 2010
Prime Minister’s Office Press Release
The Icelandic government welcomes the report published today by the Special Investigative Commission of the Parliament on the causes of the collapse of the Icelandic banking system. Consisting of independent experts, the investigative commission was established by the Icelandic parliament in December 2008. The report is the first comprehensive analysis of the causes of the collapse of the three largest Icelandic banks in the midst of the global financial crisis of October 2008.
“This important report will enable us to look forward by understanding what took place here in the months and years leading up to the banking collapse. We now need to acquaint ourselves with the report in its entirety. Iceland needs closure in order to fully focus on and finish the reconstruction which lies ahead. I believe that this report with its difficult and painful truths is a crucial part of that process”, said Prime Minister Johanna Sigurdardottir.
“Mistakes were certainly made. The private banks failed, the supervisory system failed, the politics failed, the administration failed, the media failed, and the ideology of an unregulated free market utterly failed. This has called for a fundamental review of many elements of our society. In that respect, democracy, the rule of law and close international cooperation have been and will continue to be our strongest weapons.”
“Rigorous reform has already been implemented. My goverment has systematically introduced changes to legislation and working procedures of the overall government and its institutions, but also related to the media and political parties. The investigative report is a stern reminder of the necessity for continuing this work. Iceland´s fundamentals remain strong and we will overcome the present economic difficulties.”
The Icelandic government has appointed a commission of independent experts to make further recommendations as to how the government and governmental institutions should respond to the report. In the coming days, the government will carefully study the report´s analysis and findings, consisting of over 2000 pages, and make decisions accordingly.
A summary and excerpts of the report in English are available at: www.sic.althingi.is
A webcast and recording of the press briefing by SIC in English will be available at www.althingi.is.
Reykjavik, April 12, 2010
Enclosed is the Press Release in pdf. format:
PRIME MINISTER’S OFFICE
Stjórnarráðshúsinu, 150 Reykjavik
tel: 354 545 8400 fax: 354 562 4014
postur@for.stjr.is
www.gowernment.is
Tags: Banking System, Closure, Collapse, Economic Difficulties, Global Financial Crisis, Goverment, Independent Experts, International Cooperation, Investigative Report, Johanna, Midst, Painful Truths, Parliament, Political Parties, Prime Minister, Private Banks, Reconstruction, Rule Of Law, Stern Reminder, Supervisory System
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Monday, April 12th, 2010
According to the Althingi banking report, of the twelve public figures legally allowed to respond to allegations ahead of time and have their opinions included in the final document, all placed the blame with others.
Despite their personal feelings, the report did make quite clear to state that ministers of the former government were guilty of extreme negligence in their duties leading up to, and immediately following, the banking crash.
Former Prime Minister Geir H. Haarde, Finance Minister Arni M. Mathiesen and Minister of Business Affairs Bjorgvin G. Sigurdsson are all singled out for their failings. All three were among those to have denied responsibility beforehand.
Tags: Allegations, Arni, Business Affairs, Collapse, Crash, Finance Minister, Former Prime Minister, Mathiesen, Negligence, Personal Feelings
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Monday, April 12th, 2010
Three Icelandic media men owed over ISK 100 million (USD 790,000 at today’s rate) each when the banks collapsed. Loans connected to Bjorn Ingi Hrafnsson, former Reykjavik city councillor and owner of Pressan.is news service amounted to ISK 560 million (USD 4.4 million) at the end of September 2008.
Direct loans to Hrafnsson amounted to 100 million and the rest were taken through his companies, Cambra-Hugmyndir and Ord ehf. They were nearly all in the form of advance share purchase contracts. In September 2008, the company made a new contract for the purchase of ISK 230 million in shares in Exista.
Loans connected to Oli Bjorn Karason amounted to around half a billion kronur at the time of the collapse and nearly all ran through his company OB Investments.
Styrmir Gunnarsson, the former Morgunbladid editor, had loans with all three of the big banks. They were highest at the beginning of 2006 and in the first seven months of that year, his loans through Landsbanki amounted to 130 million kronur and his total loans were ISK 150 million. From the middle of 2007, his debts to the three banks were under ISK 100 million at a time when most debt burdens were increasing fast.
Tags: 100 Million, Banking Game, Banks, City Councillor, Collapse, Debt Burdens, Debts, Direct Loans, Investments, Kronur, Media Men, Morgunbladid, New Contract, News Service, Purchase Contracts, Reykjavik City, Seven Months, Share Purchase
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Monday, April 12th, 2010
The Icelandic government decided to lower taxes during the country’s rapid economic expansion against specialist advice and against its own better judgement. This is the opinion of the Althingi banking collapse report released today, which says the decision was objectionable.
The changes made to the country’s mortgages system in 2004 also come in for criticis, when the Housing Finance Fund rules were relaxed – a key moment leading to the fall of the banks, the report states. These mistakes were made with full knowledge of their possible effects on the housing market, inflation and the whole economy.
Making these decisions in the low interest environment of the time compounded the effects as the economic slowdown began to bite. Decision makers knowingly and deliberately set the Icelandic economy up for quick gains and a heavy crash landing.
Tags: Banks, Collapse, Crash, Decision Makers, Decisions, Economic Slowdown, Economy, Finance Fund, Housing Market, Iceland, Inflation, Judgement, Lower Taxes, Mortgages, Rapid Economic Expansion, Report States, Specialist Advice
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Monday, April 12th, 2010
The Icelandic parliament’s long-delayed report into the collapse of the main banks has now been released to the public.
Sections of the report can already be read in English here.
A press conference is being held by the report’s authors and the leaders of the main political parties will comment of their initial reactions this afternoon.
Some early highlights from the report are that GBP 200 million was taken from Icesave in the UK to Iceland in the last weekend of March 2008 with the knowledge of the government and central bank. All the banks shorted the Icelandic krona in order to maximise their own profits. The banks loaned money to their owners with no security. Government since the crash is described by the report as lacklustre.
More on IceNews as it comes.
The 2,000 page report took 15 months to complete, despite an initial maximum time allowed of just 10 months. Committee members blame an underestimation of the size of the task for the delay.
Tags: 10 Months, 15 Months, Authors, Banks, Collapse, Committee Members, Crash Report, Iceland, Icelandic Krona, Icesave, Initial Reactions, Maximum Time, Money, Parliament, Political Parties, Profits, Public Sections
Posted in Iceland | No Comments »
The long-awaited report on the banking collapse was presented by the Althingi Special Investigation Commission (SIC) today at 10:30 am. The SIC concluded that former Prime Minister Geir H. Haarde, Finance Minister Árni M. Mathiesen and Minister of Business Affairs Björgvin G. Sigurdsson were negligent.