LONDON, Jan. 6 (UPI) -- Iceland's presidential veto of a repayment plan for a $5.1 billion loan from Britain triggered sharp rebukes from British authorities.
Britain threatened to veto Iceland's entry into the European Union if it did not meet its obligations, The Times of London reported Wednesday.
Financial Services Secretary Paul Myners said, "The (British) government stepped in to ensure that all retail depositors with Icesave were fully paid out, and now we expect the Icelandic government to ensure that we are repaid."
The veto, the second of an Icelandic bill in 60 years, meant 400,000 British depositors who used Icelandic banks that collapsed in 2008 would not be repaid, The Times of London said.
President Olafur Grimsson said the matter would be decided by public referendum. Just after vetoing the bill, he was presented with a petition from almost a quarter of the country's voters instructing him to veto the payback bill.
Myners said the terms of the payback plan are "not punitive," as some in Iceland believe.
The terms call for a 15-year payback plan at 5.5 percent interest with the interest excused for the first seven years. There are contingency plans if Iceland fails to keep up with the terms.
