Norges Bank extends the financing agreement with Sedlabanki Islands
In May 2008 Norges Bank and Sedlabanki Islands agreed on a swap facility that gives Sedlabanki Islands the right to acquire EUR 500 million when and if the need arises. The agreement was set to mature on 31 December 2008, but has been extended to 31 December 2009.
Norges Bank is also willing to extend to Sedlabanki Islands a medium-term loan of EUR 500 million with a maturity of up to 5 years. This loan requires a state guarantee from the Norwegian government. In a press release from the Ministry of Finance, Kristin Halvorsen, Minister of Finance, has stated that the Government will as soon as possible submit to the Storting a parliamentary proposition with a proposal for granting a state guarantee for such a loan.
Norges Bank’s loans are conditioned on the approval of the IMF Executive Board of Iceland’s Stand-By Arrangement as well as financing from other countries.
See press releases from Ministry of Finance of 3 November 2008 and from IMF of 24 October 2008