London’s Metropolitan Policy Authority had £30m deposited with Landsbanki, the Icelandic bank which collapsed in late 2008. Combing through some of the latest financial information from the MPA, it’s clear that the MPA is now expecting (at best) to get 83% of that back, leaving the police with a £5.1m loss.
Ouch. Though not so ouch as to have stopped the £2m a year spent on chauffeur-driven cars for senior Met officers who don’t have a security need for one.
(To put these numbers in some context: the annual cost of a police constable is c.£60,000.)
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3 Comments
Met set to lose £5m from collapse of Icelandic bank? That’s a drop in the ocean compared to to cuts that are about to happen, the police could , or so I heard on the BBC today, lose up to 28 thousand personnel.
Now that puts things into context.
What was a public Police force doing investing in private enterprise?
Who do they think they are? The Garda?
I presume we’re talking about the Metropolitan PolicE Authority.
Again, as with the Icelandic bank investments by local authorities, it shows a preponderance of herd mentality over common sense. It is astonishing that bodies that, in some cases, actually have larger populations than Iceland, came to believe that Icelandic banks had some magic that would allow them to offer market leading interest rates on a sustainable basis.
There are two common reasons for offering top rates on investment: one is trying to build a market share and is prepared tp offer and loss-making return for a limited time; the second is that the investment is risky and the higher return is used to tempt people in.