ISK on escrow accounts belonging to individuals pursuant to the Partial Payments in December 2011

As provided for in Act No. 37/2016 on the treatment of króna-denomiated assets subject to special restrictions, which came into effect in May 2016, ISK balances that had been on escrow accounts since the partial payments to priority creditors of LBI ehf. (LBI) were made in 2011 were transferred to an account subject to special restrictions in August 2016.

Subsequently, LBI requested a permission from the Central Bank of Iceland, based on an exemption set out in Article 12(2) of the Act, to move all ISK belonging to individuals to an unrestricted cash account in the name of LBI for the benefit of such individuals. This request has been approved and the respective balances have hence been moved to this account.

LBI furthermore intends to carry out FX conversions based on recently adopted amendments to the Act No. 87/1992 on Currency Matters which came into effect on 1 January 2017, and thus sell ISK and buy EUR for and on behalf of all the relevant individuals. Subsequently, LBI intends to transfer the relevant EUR amount, along with accrued interest but less any capital gains tax on such interest, to the same accounts that were used to transfer EUR distributions to the relevant creditors in January 2016 unless alternative instructions are received by email before payment takes place (composition@lbi.is).

The rate of EUR/ISK is currently approximately 125, but the exact rate will be the official onshore rate when the conversion takes place, which we expect will be in the next few days. Subsequently, EUR payments will be made to individuals.

Back to News Archive