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In the press: Landsbanki Guernsey in administration

Previous press statements and updates.

 

Further update on Landsbanki Guernsey in administration, 11th October 2008
Following the appointment of Rick Garrard and Lee Manning of Deloitte, the business advisory firm, as Joint Administrators to Landsbanki Guernsey Ltd ("the Bank"), the Administrators continue to work hard to safeguard the interests of depositors.

Rick Garrard commented: “We are aware of the Landsbanki Freezing Order 2008 issued by HM Treasury on 8 October 2008 and of the supplemental Notice dated 9 October 2008. The supplemental Notice makes it clear that the Order does not apply to subsidiaries of Landsbanki Island hf. The Administrators, therefore, stand by the statement issued on 9 October, which is as follows.

“The Bank had taken measures to diversify its exposure to its parent company in the six months preceding my appointment. The main reason for the Bank’s difficulties has been the placing of funds with its UK fellow subsidiary, Heritable Bank, which has now gone into Administration.

“There are significant liquid funds available to the Bank and we are doing everything we can within the boundaries of the law to enable a part payment to depositors and creditors to be made as soon as possible.”

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Statement released by the Administrator, Richard Garrard of Deloitte and Touche LLP, 9th October 2008
Following the appointment of Rick Garrard of Deloitte, the business advisory firm, as administrator to Landsbanki Guernsey Ltd (“the Bank”) on 7 October 2008, the administrator continues to work hard to safeguard the interests of depositors.

Rick Garrard: "The Bank had taken measures to diversify its exposure to its parent company in the six months preceding my appointment. The main reason for the Bank’s difficulties has been the placing of funds with its UK fellow subsidiary, Heritable Bank, which has now gone into Administration.”

"There are significant liquid funds available to the Bank and we are doing everything we can within the boundaries of the law to enable a part payment to depositors and creditors to be made as soon as possible."

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Statement released by the Administrator, Richard Garrard of Deloitte and Touche LLP, 8th October 2008
As you are now aware, following an application to the Royal Court on 6 October 2008 I was appointed as Administrator to Landsbanki Guernsey Limited (“Landsbanki” or the “Bank”) with a view to achieving the survival of the Bank or alternatively seeking a sale of the business if possible.

Landsbanki is a subsidiary of the Icelandic bank, Landsbanki Islands hf, which has gone into receivership. We are aware that a UK based subsidiary of Landsbanki Islands hf, Heritable Bank, has also gone into Administration. The Administration of Heritable Bank and the complexity of the Bank’s other assets is expected to impact on the recovery of those assets and accordingly the situation needs careful evaluation. In the meantime I am taking all possible steps to safeguard the interest of depositors.

At this time it is unclear whether depositors will receive all of their deposits and accumulated interest outstanding as at 7 October 2008 (the “date of appointment”).

All payments other than those necessary to maintain the operations of the Bank during the realisation of the assets have been stopped. These include any payments in the course of settlement as at the date of my appointment. Any such amounts representing payments from customer accounts which have been withheld from payment are being returned to customer accounts at the date of appointment.

As of the date of my appointment, the Bank was closed for receipt of new deposits and any such amounts received after this date or in process of settlement at this date have not been accepted by the Bank and have been returned.

The Bank’s day to day operations continue to be supported by its service providers and all routine customer enquiries should be made to the client service desk on 726885.

I have been in place as Administrator for less than two days and, as you will appreciate from events worldwide, it does take some time to deal with matters of this complexity.

As significant developments occur, I will endeavour to keep the depositors and creditors of the Bank advised over expectations of repayment and of proposals to be made to the Royal Court with regard to distributions. I will also continue to update the States of Guernsey on all significant developments.

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Rick Garrard
Administrator, Landsbanki Guernsey Limited

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