* Iceland says has meet with U.S. funds who hold frozen
* Resolving deadlock who help remove remaining capital
* Loomis Sayles says it did not attend meeting
(Adds comment from Loomis Sayles that it did not attend
By Ragnhildur Sigurdardottir
REYKJAVIK, March 1 Icelandic officials have met
with foreign funds to discuss ending a standoff over more than
$1 billion of assets frozen by Iceland in the wake of the 2008
financial crisis, the finance ministry said on Wednesday.
Some U.S. funds that refrained from taking part in an
auction last year to unlock their assets - because they
considered the terms unfavourable - waged a legal fight in
Icelandic courts and at the European Free Trade Association's
A finance ministry spokeswoman said a report by news website
Visir that the assets could be unlocked at a considerably more
favourable rate than last year's auction was broadly accurate.
She said meetings had been held but declined to offer further
Visir reported that Icelandic officials had met Autonomy
Capital, Eaton Vance, Loomis Sayles and Discovery Capital in New
York this week, though Loomis Sayles contacted Reuters to say
that it had not attended or been invited to the meeting.
Visir cited people with knowledge of the funds' claims as
saying they would not be willing to discuss selling their assets
for a price less favourable than 130 to 140 crowns per euro.
The range compares with 190 crowns per euro in last year's
auction and a current exchange rate that strengthened to the
highest since 2008 on Wednesday, at 112.25 crowns.
It has soared from a market price of just below 140 crowns
per euro when that auction was held, and appreciated more than
10 percent against the dollar, euro and the British pound
in February alone.
At the end of 2016, total offshore crown assets amounted to
191 billion crowns ($1.79 billion), down by 128 billion since
end-March last year, the central bank said in January.
The offshore assets were moved into separate locked accounts
last year as Iceland prepared the delicate process of removing
capital controls that were imposed in 2008 when the country's
banking system collapsed.
Icelandic officials have said the full lifting of capital
controls, including resolving the offshore crown issue, would be
revisited at the start of this year while the central bank chief
has said capital controls could disappear in 2017.
Last week, Iceland's central bank said it would consider
offering exemptions to its Foreign Exchange Act for derivatives
trading, in another step towards the full lifting if capital
Autonomy Capital declined to comment, Eaton Vance did not
immediately respond to a request for a comment while Discovery
Capital could not be immediately reached.
(Additional reporting by Daniel Dickson in Stockholm and Marc
Jones in London; writing by Daniel Dickson; Editing by Dominic
Evans and John Stonestreet)