BIScom News: Leaks show Kaupthing made huge loans to shareholders
Wikileaks.com is back in the news: this time an application for a gagging order was made by Kaupthing bank after the website published documents showing the bank's loan book. But the bank has withdrawn its application after the story ran around the world in hours, and both public and politicians demanded more not less information.
The leaking of an internal "risk report" showed that the bank lent USD2,300 million to an investment company called Exista run by Ágúst and Lýður Guðmundsson, Exista was a substantial shareholder in Kaupthing. Robert Tchenguiz, an Exista director, was loaned some USD2,600 million.
Bjorgolfur Gudmundsson and Bjorgolfur Bjorgolfsson are father and son and stupendously wealthy, even after substantial losses in recent months. They were the owners of Landbanksi, the first of the Icelandic banks to fail. They owed Kaupthing USD120 million.
A website bizarrely called The Iceland Weather Report has been tracking loans made shortly before Kaupthing collapsed.
It has identified what it terms a "bullet loan" to Helgi Sigurðsson, the former head of legal at Kaupthing - who had moved onto the new entity but resigned when the news of the loan came out. That was for USD3.5 million.
But the site also refers to a loan of USD7 million made to Kristján Arason just before the collapse. He was head of the corporate banking division and is the husband of Þorgerður Katrín Gunnarsdóttir - the vice chairman of the Indpendence Party and also Minister of Education, Science, Culture and Sport.
When the bank collapsed, IWR reports, the bank made a proposal to write off all outstanding loans to staff. At the time, most people thought "that's nice" - assuming it related to e.g. car loans, etc. that, in the jobs wasteland that Iceland had become, the loans would fall into default anyway. But the decision was not made - and in the light of the latest revelations, it might not make it in quite the blanket fashion it was proposed.
(figures are translated from ISK - Icelandic Kroner)
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