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Iceland

Icelanders reject new Icesave bank deal

Reuters/Ingolfur Juliusson

Iceland’s voters have rejected a renegotiated deal to compensate Britain and The Netherlands over the 2008 collapse of Icesave bank, rejecting the government’s call for a yes vote in a rerun referendum.

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With 70 per cent of the vote counted, the no vote was 57.7 per cent against 42.3 per cent

Dossier: Eurozone in crisis

yes, according to RUV public radio.

The vote was on whether to pay back Britain and the Netherlands 3.9 billion euros they spent on compensating 340,000 of their citizens who lost money when online bank Icesave went during the global financial crisis.

The result came as "a shock" for the government but also for parliament, which endorsed the deal, said Prime Minister Johanna Sigurdardottir.

The latest deal, negotiated among the three nations over more than two years, was considered more favourable than a previous one rejected by 93 per cent of voters in January 2010, but would still have meant a bill of 12,000 euros plus interest per citizen.

The country faced international pressure to accept that deal and is likely to face litigation following the latest rejection.

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