Creditors of Straumur Burdaras Investment bank have voted on and approved a composition agreement, by virtue of which the ownership and control will be transferred to creditors who will convert a part of their claims for shares and receive a bond issued by the bank.

Iceland-based Straumur said that in the coming years assets would be managed and sold with the aim of maximizing the recovery of creditors. It is projected that secured creditors, i.e., the Icelandic state and Islandsbanki, will get their claims paid in full. Unsecured creditors can expect a recovery of close to one half of their claims.

The Icelandic Bank added that the composition agreement furthermore lays the foundations for its ongoing investment banking operations in Iceland within a separate legal entity.

Straumur has 120 composition creditors which include Landsbankinn, Raffeisen Zentralbank Osterreich, Goldman Sachs Lending Partners, Bayerische Landesbank and Deutsche Bank. Priority creditors and secured creditors such as the Icelandic state and Islandsbanki, as relates to the transfer of Straumur’s deposits to Islandsbanki, will have their claims paid in full.

Straumur holds 143 assets in its portfolio with a total estimated value of EUR1.2bn of which more than 90% are outside of Iceland.

Ottar Palsson, CEO of Straumur, said: “The restructuring of Straumur is a result of a close cooperation between the company’s staff, The Resolution Committee, The Winding Up Board, advisers and major creditors during the past few semesters. It is a great pleasure that the Composition Agreement is now agreed upon by the creditors and by this overwhelming majority. Ahead of us are important tasks and we are determined to live up to the trust, which the company’s new owners have vested in us.”