LONDON, Sept 29 (Reuters) - Iceland’s crown currency plunged over 3 percent to a record low against the euro on Monday after its government announced that it was taking control of the country’s number three bank Glitnir GLB.IC. The crown fell over 3 percent versus the euro EURISK= to a historic low of 143.27 before recovering to trade 1.55 percent lower to 139.67 at 0940 GMT.
The dollar ISK= was 3 percent higher at 97.51 crowns, trimming an earlier 5 percent gain.
“The Icelandic banks have had a funding problem for some time, but this was a very drastic move which I don’t think many people expected,” SEB FX strategist Carl Hammer said.
Reporting by Sebastian Tong; editing by Veronica Brown