North councils' investments at risk after Icelandic collapse

Oct 10 2008 by William Green, The Journal THE North East faces cuts in public services or higher taxes after councils and Northumbria Police invested more than £43m in crumbling Icelandic banks. And councils may have to sell assets to pay for losses after it emerged £23m of Northumberland County Council’s money is at risk – sparking warnings that the switch to unitary authority status could be threatened. Icelandic banks hit by global economic turmoil have also seen a £4.5m investment by council chiefs in Gateshead, along with £7m from Derwentside and £6m from Redcar and Cleveland. Northumbria Police invested £3.5m in a bank owned by the troubled Landsbanki. Hopes of getting money back may prove difficult as Iceland slides towards bankruptcy as its banks have run out of cash. Financial turmoil, sparked by uncertainty over... [read full story]