Feb. 7 (Bloomberg) -- Iceland’s Baa3 credit rating outlook was revised by Moody’s Investors Service to stable from negative, based on the reduced event risk following the European Free Trade Association Court decision in January.
The European Free Trade Association Court in Luxembourg dismissed a case brought the EFTA Surveillance Authority, which claimed the island had breached European Economic Area law. A loss would have allowed the Netherlands and the U.K. to seek damages of much as 335 billion kronur, according to International Monetary Fund estimates.
The decision frees the government of the potentially large costs related to the Icesave dispute with the British and Dutch governments, Moody’s said in a statement.
Baa3 is the lowest investment-grade rating at Moody’s.
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