IMF approves Iceland support scheme

The International Monetary Fund (IMF) has approved a two-year, $2.1bn (€1.67bn) support programme for Iceland that is designed to restore confidence and stabilise that country’s shattered economy.

The approval had been held up because of a British-Icelandic dispute over Britons’ accounts in failed Icelandic banks.

The IMF agreed last month to lend Iceland $2.1bn and help the country raise $3.9bn (€3.1bn) in loans from other countries.

Britain held up the approval with the argument that Iceland first should pay back British citizens’ deposits in failed Icelandic banks.

Iceland earlier had said depositors would get up to €21,000.

The Finnish Finance Ministry said four Nordic countries will lend Iceland $2.5bn (€2bn) dollars to help the country recover from its economic meltdown.

Finance Ministry official Martti Hetemaki said the decision by Finland, Sweden, Norway and Denmark came after the IMF announced earlier that it had approved the $2.1bn support package for Iceland.