Iceland to Get $6 Billion Loan From IMF-Led Group, Poland Says

Iceland to Get $6 Billion Loan From IMF-Led Group, Poland Says

By Nathaniel Espino and Marta Waldoch

Nov. 7 (Bloomberg) -- Iceland will receive a $6 billion- dollar financial aid package from a group led by the International Monetary Fund, the Polish Finance Ministry said.

The group also includes Scandinavian countries, the U.K., the Netherlands and Poland, which will contribute about $200 million to the group, the e-mailed statement from Warsaw said. Magdalena Kobos, a spokeswoman for the ministry, confirmed the authenticity of the statement by telephone.

The IMF has already said it will give the Atlantic island $2.1 billion after the banking system collapsed and the currency's value evaporated. Norway has offered 500 million euros ($635 million) and the Faroe Islands 300 million kroner ($51 million).

The economy of Iceland, the first western nation to seek aid from the IMF since the U.K. in 1976, faces a prolonged period of contraction, coupled with faster inflation and rising joblessness. Gross domestic product will shrink as much as 10 percent next year, the IMF forecasts.

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