The Administrators of Landsbanki Guernsey Limited have announced a proposal to make a part-payment to depositors equivalent to 30p in the £1.

But there is doubt over the bank’s ability to repay depositors in full.

‘We will provide depositors with details of how to request this withdrawal or how to transfer the funds to another bank in a letter to be issued to customers later today.’ said joint administrator Rick Garrard in a statement issued by Deloitte this morning.

‘We are now in a position to make a part-payment on request to depositors equivalent to 30p in the £1 on all deposits as at 7 October 2008, the date the Bank went into Administration. We will provide depositors with details of how to request this withdrawal or how to transfer the funds to another bank in a letter to be issued to customers later today. The Q&As will also be updated later today on our website at www.landsbanki.co.gg.’

He states that the prospects for further repayment to depositors are good, ‘but the repayment of substantial extra sums is dependent on a recovery of certain illiquid assets’.

But the statement adds that the collapse of HB and ‘other uncertainties’ have ‘placed greater doubt on the ability of the Bank to recover sufficient assets to pay depositors in full’.

You can read the full statement, in PDF format, by clicking here.