The county council has revealed it has £8 million invested in an Icelandic bank that has gone bust.

The authority invested in Heritable Bank, a UK bank owned by the Icelandic Landsbanki Island Group, three months ago.

But yesterday it was announced that Heritable had gone into administration. The council is now waiting for administrators Ernst & Young to tell bosses how they can recover the money.

A spokesman has stated the authority is confident this will have no immediate impact on services but warned that, if some or all of the cash is not recovered, the council will have to review its long term plans.

Ironically, the council's investment was due to be returned on the same day the bank went into administration.

North Wiltshire District Council has also invested in Landsbanki to the tune of £3m, which was due to mature next March, and a further £1m invested in Heritable Bank.

More than 50 local authorities in the UK have confirmed they had investments in the collapsed bank.

  • Wiltshire is backing the Local Government Association's plea to Central Government that council assets are protected in the same way as individuals' savings deposits have been.
  • Kennet District Council today claimed this financial blow will not affect its service.