Icelanders reject payment of UK, Dutch loans (VIDEO)

Icelanders have voted not to pay back a $5.8 billion bailout for a failed Icelandic bank, forcing an international court battle against the U.K. and the Netherlands.

Early results from a referendum held Saturday showed about 60 percent of voters were opposed to the payback scheme, representing "a bold popular rejection of the notion that taxpayers must bear the burden for bankers' woes," according to the Wall Street Journal.

The Reykjavik-based National Electorate Commission estimated voter turnout at 75 percent.

The money in question, placed by British and Dutch depositors in an Icelandic Internet bank called Icesave, was lost when Icesave's operator, Landsbanki Islands, collapsed along with the rest of Iceland's big banks in October 2008, the Journal reported.

The failure of Landsbanki threatened to leave 350,000 British and Dutch depositors out-of-pocket, but they were repaid by their own governments, which then turned to Iceland for compensation.

Britain said it was "disappointed" by the result, while the Dutch finance minister said the time for negotiations was "over," the BBC reported.

It quoted Iceland's Finance Minister Steingrimur Sigfusson as saying that a court solution would take at least a year. 

Iceland's government had hoped a deal would end the financial isolation that has stalled Iceland’s revival from its banking collapse, according to Business Week. 

But Olafur Ragnar Grimsson, Iceland's president, pointed out that the U.K. and the Netherlands would still receive "immense sums" from Iceland owing to their claims to Landsbanki's estate.

Grimsson, who in February vetoed a Parliamentary bill on the new deal, triggering Saturday's referendum, said Sunday that Icelanders had spoken clearly. "The leaders of other states and international institutions will have to respect this expression of the national will."