Russia Grants Iceland Giant Loan in Euros

News

Russia Grants Iceland Giant Loan in Euros

Russia has granted Iceland a EUR 4 billion (USD 6 billion) loan, as Russia’s Ambassador to Iceland Victor I. Tatarintsev announced to Davíd Oddsson, chairman of Iceland’s Central Bank’s board of directors, this morning.

The loan will be to three or four years and the interest rates between 30 and 50 points above Libor rates, ruv.is reports.

The decision has been confirmed by Russia’s Prime Minister Vladimir Putin.

According to ruv.is, Iceland’s Prime Minister Geir H. Haarde has been investigating the possibility of such a loan from Russia since mid-summer.

Experts from the Central Bank of Iceland and Iceland’s Prime Ministry will travel to Moscow shortly.

According to an announcement from the Central Bank, the loan from Russia will greatly strengthen Iceland’s foreign currency reserves and strengthen the basis of the Icelandic króna.