AMSTERDAM, Sept 18 (Reuters) - Iceland will honour its promise to repay the Netherlands money that Dutch savers lost in the online accounts of a failed Icelandic bank, Iceland's finance minister said in a newspaper interview on Saturday.
Steingrimur Sigfusson told De Telegraaf, the Netherlands' largest newspaper, that the Dutch people had nothing to fear.
"The Netherlands can rest easy. Their money really will be returned," Sigfusson told the paper.
The British and Dutch governments want Reykjavik to return money paid to depositors whose funds were frozen in so-called "Icesave" accounts operated by Landsbanki, which collapsed along with Iceland's other main commercial banks in 2008.
Talks resumed in the Netherlands earlier this month on a new deal for Iceland to repay the money, after the country's voters overwhelmingly rejected an earlier agreement.
The prolonged nature of the talks, and the Icelandic public's rejection of an agreed deal, has raised doubts among the Dutch public about the 1.3 billion euros being repaid.
Completion of an agreement has been seen as vital to Iceland's aspirations to join the European Union, as well as a key condition of its support from the IMF.
"We want to have this resolved," Sigfusson said. "We want to pay, but everything turns on the conditions under which that happens."
Sources have previously identified the length of the repayment period and the interest rate to be paid on the money as key sticking points to a deal. (Reporting by Ben Berkowitz, editing by Miral Fahmy)