Iceland's parliament has voted to approve a new deal reached with the Netherlands and UK to repay money lost in the collapse of the Icesave Bank.
Voting for a third time, parliament passed the new Icesave bill with 44 votes in favour, 16 opposed and three members of the 63-seat house abstaining.
The deal, which still needs to be approved by President Olafur Grimsson, paves the way for the small Nordic country to repay in full the €3.9bn which Britain and the Netherlands spent compensating around 340,000 of their citizens hit by Icesave's collapse in October 2008, at the height of the financial crisis.
The new deal, reached with British and Dutch negotiators in December, was required to pass three parliamentary votes before it could become law.
Today's vote makes it more likely that Grimsson, who early last year vetoed the previous deal and put it to a referendum, will give his approval.
At the March, 2010 referendum, 93.2% of Icelandic voters rejected the deal.
The new deal is considered far more advantageous than the last one, and a recent poll showed nearly 57% of Icelanders wanted parliament to adopt the bill.
Nonetheless, a petition circling since Friday urging parliament to vote it down and for Grimsson to block the bill and issue a new referendum had by Wednesday afternoon gathered nearly 32,000 signatures, accounting for about 10%of the country's population.
Before Grimson called for last year's popular vote on the matter, around 75,000 people had signed a petition against the previous deal.
Two opposition motions calling for a referendum on the new bill were meanwhile voted down by parliament Wednesday with 33 votes opposed and 30 in favour.
Under the new deal, Iceland would be able to repay the nearly €4bn very gradually between 2016 and 2046 at a 3% interest rate for the €1.3bn it owes The Netherlands and at a 3.3% rate for the rest it owes Britain.
Even without counting interest, the repayment deal amounts to about €12,200 for each of Iceland's nearly 320,000 inhabitants, but Reykjavik is hoping to cover much of the repayment with assets in Icesave's failed parent company, Landsbanki.
In the previous deal rejected at the referendum, Iceland had to repay the Netherlands and Britain between 2016 and 2024 at a 5.5% interest rate.
During the parliamentary debate before today's vote, Social Democratic Prime Minister Johanna Sigurdardottir insisted that passing the bill was the right thing to do.
Prime Minister Johanna Sigurdardottir has said 'It is unlikely that a better agreement could be reached, if parliament rejected the bill, the case could go to the courts where Iceland has the potential of a much worse result. It is long overdue to take care of Icesave.'
Foreign Minister Ossur Skarphedinsson said ahead of the vote that 'It's the right thing to do to say yes to this Icesave agreement.'
