Iceland agrees to repay UK depositors in failed bank

Britain has secured agreement from the Icelandic authorities to repay the £2.3bn (€2.6bn) paid out by the British government in compensation to UK depositors in the failed Icesave bank, the UK Treasury said today.

Under the terms of the agreement, the money paid out by the British government will be treated as a loan to the Icelandic Financial Compensation Scheme which will be repaid over 15 years.