Extract from a meeting between DCC Cllr Robert Gould and Jim Biggin of ACRA November 2014
The Icelandic funds situation is virtually resolved. The Landsbanki claim has been sold to a third party under competitive auction and just over 91% of the original debt recovered. This was more than expected resulting in a transfer to reserves of £100,000. 94% of the Heritable debt has been recovered (£12.5 million of an original £13.3 million). Again this was more than expected and as a result £850,000 has been transferred to reserves. The situation is not concluded, but now awaits the outcome of an Icelandic court case, as a result of which an additional 1% or 2% of the original debt will be returned to DCC.
At a meeting with Councillor Spencer Flower (the member of Dorset County Council responsible for funds) we learned that to date 42 pence in the pound has been recovered from one bank. It is anticipated that the eventual recovery will be 85 pence in the pound from this source. The timescale of the recovery is unknown. Nothing has been recovered to date from the second bank which has stopped trading. However, this bank’s mortgage book is being sold in stages to other financial institutions and recovery of at least 95 pence in the pound is forecast. As with the first bank no timetable can be determined.
The loss of income thus continues. At current market rates of interest this doesn’t amount to much but may become significant if interest rates rise before further recovery is affected.