The Audit Commission seeks to ensure that £180bn of public sector spending provides "value for taxpayers". It said it deposited £5m in Landsbanki in April this year - and a further £5m in July in Iceland's Heritable Bank. The commission said the deposits were in "full compliance" with their guidelines "on prudent investment".
Hmm. March 2008, This Is Money. The Audit Commission put their money in in April and July. With one bound they've managed to discredit themselves. This severely damages their right to a respectful hearing when they castigate others for mismanagement.
But the real horrors are in Iceland.
Credit insurance for debts at Iceland's biggest bank, Landsbanki, is priced at 610 points while that for Kaupthing is priced at a hair-raising 856. Given that these two have taken billions in UK retail deposits, it may be a sobering thought for savers to consider where they are putting their cash. These banks are now seen as the most unsafe in the developed world. Of course, no one can be sure that disaster looms for anyone, but the figures on credit default swaps show clearly where investment professionals think the big risks are.
You have been warned.