The official website for the Glitnir bank

On 23 July 2010, the District Court of Reykjavik made a ruling regarding foreign currency indexed loans, which had been deemed illegal by the Supreme Court last month. The ruling was that the original interest (LIBOR +) should not apply, rather Icelandic interest (non-indexed) issued by the Central Bank of Iceland from the first day of the loan agreement.

The Resolution Committee believes the issue is now moving in the right direction, but the matter has been appealed to the Supreme Court. The Resolution Committee expects a ruling in September this year.

It is the Resolution Committee’s view that, should the Supreme Court not over rule the District Court’s decision, there will be minimal impact on Glitnir and its investment in Islandsbanki.

The Winding-Up Board of Glitnir has prepared two memos which may provide useful information to creditors of the Bank. The first is in relation to the legal framework and processes in respect of making interim distributions to creditors. The second is in relation to the legal framework for a Composition under Icelandic law. Both memos are attached below.

Glitnir composition memo
Glitnir distribution memo

On 9 July 2010 in the Royal Courts of Justice in London, Jón Ásgeir Jóhannesson (JAJ) applied to have the worldwide freezing order, originally granted on 11th May 2010, overturned.  GLB argued that the order should remain in force as they believed that the responses by JAJ to the original order were incomplete and did not present a complete view of the worldwide assets he controlled.