Bookseller Borders UK has been dragged into Iceland’s financial difficulties as it has emerged that it received a loan from troubled bank Landsbanki earlier this year.

The retailer secured a£23 million asset-based loan and also has an overdraft facility with Landsbanki. Its links with the bank have implications for the retailer, but any impact is not yet clear.

The revelation highlights yet another retailer on the high street that has been affected by Iceland’s crisis. Baugur reiterated yesterday that its UK businesses remain unaffected by the Icelandic situation.

According to The Independent, the£23 million inventory facility, provided by Landsbanki Commercial Finance, is secured against book inventory in the retailer’s stores and distribution centre. It has been speculated that the Icelandic authority may force the bookseller to pay back some of its asset-based loan, although the terms of the deal are unclear.

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