ICELAND TO PRIVATISE STATE BANK UTVEGSBANKI The Icelandic government said it will privatise the state-owned bank Utvegsbanki, the country's second largest. Parliament also granted an 800 mln crown cash infusion to ease cash flow problems that arose when the bank lost 600 mln crowns in a shipping firm bankruptcy two years ago. Utvegsbanki director Halldor Gudbjarnarson told Reuters the decision to privatise the bank was a relief and that foreign banks had already expressed interest in taking a share. A quarter of the one billion crown total share capital will be available to foreign investors, government officials said.