The District Court of Reykjavik today agreed to a request from the bank – which has a 20 per cent stake in fashion group Mosaic – to extend its moratorium period.
A request to protect the bank from its creditors using the Icelandic equivalent of Chapter 11 bankruptcy protection has been extended to November 13.
At a meeting with the bank’s creditors on February 5, the Supreme Court of Iceland was presented with an update on developments at the bank since the intervention of the Icelandic Financial Supervisory Authority on October 9. Details of the bank’s assets as of November 15 were provided.
The future of Mosaic, which owes more than£400m in debt to Kaupthing, has hung in the balance since the collapse of the Icelandic banking system in October. Management are in talks with the bank about restructuring its finances.
In a statement Kaupthing said: “One of the main tasks of the Resolution Committee and its employees has been to protect assets and safeguard the interests of creditors as far as possible.
“In the opinion of the Resolution Committee and the Moratorium Supervisor it is crucial that Kaupthing be given the breathing space to concentrate on the tasks at hand within the bank so that it can achieve its objectives to protect creditors' interests, maximise the recovery rate of claims and ensure the equal treatment of creditors.”