I1t's govt. policy; regulations require public bodies to get the best returns possible on their money and so the 7% being offered by icelandic banks was quite tempting. That said, it's also imbecility on the part of the public bodies to pay a CFo 100k a year and then fail to notice that Standard & Poor rated the Icelandic banks as terminally ill over a year ago. I doubt that anyone will actually get fired over this, but we might see some professional negligence claims go in against Cap Gemini who advised the investments.
What they said, plus I understand from what a council spokesman said on the radio that public bodies of these sorts are required to a) spread their investments around, b) select investment institutions from a recommended list, and some of the Icelandic banks were on this list, and c) optimise the return for money invested in this way.
The combination of the three means that a lot of government institutions (local councils, the police federation, etc...) would be likely to have some, but not all (or even most) of their money in there.
I understand that davywavy is correct that the Icelandic banks had been rated as Risky or Bloody Risky for months now, but if one has been handed an Approved List of Institutions from On High, I think one can be forgiven - to some extent at least - for assuming that someone else had done their homework.
Cap Gemini have been recommending them as investments since *after* the lowered security ratings, which leads me to suspect that CG might get sued sometime soon.
Better interest and what was a good credit rating - which pretty much used to be the only necessary rules of approval. Off the top of my head, they were an AA.
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That said, it's also imbecility on the part of the public bodies to pay a CFo 100k a year and then fail to notice that Standard & Poor rated the Icelandic banks as terminally ill over a year ago.
I doubt that anyone will actually get fired over this, but we might see some professional negligence claims go in against Cap Gemini who advised the investments.
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mumsbanks go to Iceland.(sorry, someone had to...!)
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(Sorry me too)
D
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The combination of the three means that a lot of government institutions (local councils, the police federation, etc...) would be likely to have some, but not all (or even most) of their money in there.
I understand that
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