REYKJAVIK, Iceland (AP) - Iceland's prime minister has offered government guarantees on Icesave savings deposits in Iceland and Holland of nearly 21,000 euros ($26,600) on each account.
Prime Minister Geir H. Haarde said Sunday the next step will be for Iceland to hold talks with the United Kingdom and other EU countries on how the payments will be made.
It was not immediately clear how the deposits would be covered. The total amount is estimated to be about 600 billion Icelandic kronar, or about 3.5 billion euros. Haarde said he hoped other countries would help cover the costs, and that additional funds could be raised by selling off the bank's assets.
Relations between London and Reykjavik plummeted last month after Britain used anti-terrorist legislation to freeze the assets of collapsing Icelandic banks in a bid to protect British savers' deposits.
The savings of about 230,000 British depositors' money vanished when Icesave's parent bank, Landsbanki went into receivership in October.
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