From Iceland — Municipality Ends Business With Bank Due To Pay Raises

Municipality Ends Business With Bank Due To Pay Raises

Published March 24, 2011

A rural town council has approved a measure calling for an end to all municipal business with Arion Bank, in response to pay raises the bank awarded its top management.
With the economy still slowly recovering, many Icelanders have been angry at recent news that Landsbanki has given pay rises to its managers since 2008, while at the same time aggressively pursuing foreclosures on households behind on their mortgages.
But Landsbanki hasn’t been the only bank awarding its management salary increases; Arion Bank has also done so, and this has not gone unnoticed by the town council of Eyjafjarðarsveit, which includes Akureyri.
In a measure recently approved by town council there, pay rises to top management at Arion Bank has compelled the municipality to sever all business with the bank, Vísir reports.
The measure points out that the pay raises are “entirely inappropriate” at a time when the public, small businesses and offices struggle to make ends meet. The municipality has therefore decided the right thing to do would be for it to end any and all business with Arion Bank.
A response from Arion Bank has not yet been made.

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