U.K. Hands First License to Icelandic Finance Firm Since Crisisby
As the U.K. grapples with the uncertainty of how its financial industry will cope after voting to exit the European Union, the country’s regulator has handed an operating license to the first Icelandic institution in a decade.
GAMMA Capital Management received approval from the Financial Conduct Authority to operate in the U.K., the first such authorization for an Icelandic financial services firm since the Atlantic island’s 2008 meltdown. The company has been operating in the U.K. since 2015 under the supervision of Iceland’s financial watchdog.
A previous expansion into Europe by Icelandic financial firms ended in disaster in 2008, resulting in a standoff with the Netherlands and Britain. Back then, Chancellor of the Exchequer Gordon Brown invoked anti-terror laws to freeze Icelandic assets as part of a depositor claims dispute known as Icesave. The U.K. authorities worried that as many as 350,000 savers would lose their money in failed Icelandic lender Landsbanki Islands.
The dispute found its way to the European Free Trade Association Court, which ruled in 2013 that the island was right to reject claims from British and Dutch depositors, after its three biggest banks failed under an $85 billion debt mountain. Iceland is now emerging from its crisis and is preparing as soon as this year to dismantle the last of the capital controls put in place in 2008.
GAMMA, which has offices in London’s Mayfair district, is hoping to profit as Iceland’s economy re-enters the global financial markets. The asset manager was established in 2008 and has about $800 million under management in Iceland.
“Iceland is coming in from the cold and we believe that the strong economic outlook in Iceland creates exciting opportunities for foreign investors,” Gisli Hauksson, GAMMA’s chief executive officer, said in a statement.
The company was registered to provide regulated products and services as of Aug. 5, according to the FCA website.