Monday, 20 October 2008
Westminster City Council's little mistake (worth £17m)
Westminster City Council has, or had, £17m in Icelandic banks: £7m in Landsbanki and £10m in its UK subsidiary, Heritable. Nearly £10m of these deposits were placed in August. According to Councillor Colin Barrow CBE, Leader of the ruling Tory group on the Council, in August "both banks had excellent credit ratings of the highest standard". But on 30th January 2008 David Ibison, writing in the Financial Times about Landsbanki and two other major Icelandic banks, stated there was "increased uncertainty over the banks arising from their perceived reliance on wholesale funding, cross-ownership issues, an alleged lack of transparency, and macro-economic imbalances." How come this increased uncertainty had not come to the attention of Cllr Barrow? I am surprised, especially as according to his biography on the Westminster Conservatives' website (not yet updated to reflect his promotion to Leader), he "handles the Council's finances, as Deputy Leader of the Council. He has his own investment management business in Westminster".