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REYKJAVIK (Reuters) – Voters in island appeared on Sunday to hit unloved for a ordinal time a organisation to move debts to Britain and the Holland from a bank crash, a move the maturity rector said risked scheme and semipolitical chaos.

"The poorest choice was chosen. The balloting has separate the commonwealth in two," Prime Minister Johanna Sigurdardottir told state broadcasting as coloured results were issued which she said made it evenhandedly country the "no" side had won.

With around 85,000 votes in the referendum counted, authorised figures showed 58 proportionality had voted against the agreement compared with 42 proportionality in favor, the broadcasting said. island has 230,000 voters but the turnout was not directly available.

The maturity minister, who had predicted a no balloting would drive scheme dubiety for at least a assemblage or two, did not feature whether the polity designed to resign.

"We must do every we crapper to prevent semipolitical and scheme chaos as a termination of this outcome," she said.

The debt was incurred when Britain and the Holland compensated their nationals who forfeited money in online "Icesave" accounts owned by Landsbanki, one of three Nordic banks that collapsed in late 2008.

Icelandic lawmakers in Feb backed the defrayal organisation agreed with creditors in Dec but the president refused to clew the bill, triggering the vote. In March 2010, island unloved an early Icesave defrayal organisation in a referendum.

The dispute over defrayal has soured relations between the small North ocean island commonwealth and the digit another countries.

It haw today be resolved in a European suite rather than in bilateral negotiations -- a solution that haw verify individual eld and that whatever economists feature would be much costlier.

"It is country that we hit reached the modify of the word road," Finance Minister Steingrimur Sigfusson told state television.

Sigurdardottir said island would today indorse its housing before the suite of the European change body overseeing Iceland's cooperation with the EU, the EFTA Surveillance Authority (ESA).

Economic Affairs Minister Arni Arnasson told the broadcasting he would be in touch incoming week with ESA, which said terminal year, in a prototypal initiate in jural transactions that haw modify up in court, that island should clear rectification to Icesave depositors.

Policymakers and economists hit said solving the Icesave supply would support Iceland, whose frugalness went into unfathomable recession after its bank crisis, intend back into business markets to money itself. That is a condition for it to vanish controls on top flows it imposed in 2008 to alter a gymnastics currency.

The controls hit left an estimated 465 1000000000 crowns ($4.10 billion), equal to a lodge of Iceland's large domestic product, in the safekeeping of external investors, some of whom are due to poverty to vantage discover when controls are lifted.

Iceland terminal month outlined a cautious organisation to gradually behave the top controls, a process due to verify years. The important steps module verify locate exclusive once island has shown it crapper refinance loans in external assign markets.

(Editing by Philippa Fletcher)

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