Copenhagen/Reykjavik - Financially-battered Iceland has opted
to draw on swap facilities with the central banks of Denmark and
Norway, the Icelandic central bank said Tuesday.
The central bank said it drew 400 million euros (543 million
dollars) in accordance with a mid-May agreement it made with the
central banks of Sweden, Norway and Denmark.
Each swap facility arrangement provides the Icelandic central bank
access to 500 million euros against the Icelandic currency.
Iceland has been hammered by the financial turmoil and its main
commercial banks have been nationalized by the state.
The central bank also said a delegation from Iceland arrived in
Moscow on Tuesday for talks with Russia over a loan.
In Copenhagen, Danish Prime Minister Anders Fogh Rasmussen earlier
Tuesday indicated that Nordic neighbours of Iceland were preparing to
help the North Atlantic state financially.
Speaking to foreign correspondents, Rasmussen declined to spell out
details but said the neighbouring Nordic states were prepared to offer
'more than just moral' help.
Denmark, Finland, Norway and Sweden along with Iceland belong to
the Nordic Council organization.
In Reykjavik, trading on the Icelandic stock exchange resumed
Tuesday with the exception of bank shares.
The operator NASDAQ OMX Iceland halted trading on Thursday owing to
what the operator called 'unusual market conditions.'
The Icelandic parliament approved special legislation a week ago
giving special powers to the Icelandic Financial Supervisory
Authority.
Over the weekend, representatives of Iceland, Britain and the
Netherlands discussed the repayment of foreign deposits frozen in the
three Icelandic banks Landsbanki, Glitnir and Kaupthing.
The Icelandic commercial banks have rapidly expanded their
operations in recent years, and run up liabilities at least five times
that of Iceland's GNP.
Iceland's Finance Minister Arni M Mathiesen was meanwhile reported
to be in Washington to discuss a possible emergency loan from the
International Monetary Fund (IMF).
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