Councils across the UK are celebrating victory in their battle to be recognised as preferred creditors to Iceland's collapsed banks – a decision that should see town halls retrieve the lion's share of the £1bn they had deposited.

Iceland's Supreme Court today (28 October) awarded councils ‘priority creditor' status following months of detailed court hearings. Had the councils' failed to receive preferred status, many town halls faced losing a huge chunk of their deposits in defunct accounts – with almost half of the deposits at risk.