Winchester and Rushmoor councils have invested £3m in the banks
Two Hampshire councils have investments totalling £3m in troubled Icelandic banks, they have revealed.
Rushmoor Borough Council said the cash was in the form of a £2m investment with Glitnir, which was 5% of its total investments of £40m.
Winchester City Council said it had £1m invested with Heritable, a subsidiary of the troubled Landsbanki.
A spokesperson said the money was about 3% of the city council's total investments of £32m.
Councillor George Beckett, leader of Winchester City Council, said the council used external treasury management advisors and had taken "account of the good credit rating of the bank at the time the investment was made".
Winchester City Council said it was backing the Local Government Association's (LGA) call for the chancellor to protect council deposits.
More than 100 local authorities have more than £840m at risk after investing in Icelandic banks.
Gordon Brown said he was considering "further action", but the government is not offering to guarantee the deposits.
The LGA insisted that all the councils involved had enough money to ensure that frontline services should not be affected.
Two local authorities in the English county of Hampshire have a total of £3 million invested with troubled Icelandic banks it was revealed today. Rushmoor Borough Council has a £2 million investment with Glitnir, while  revealed it has £1m invested with Landsbanki subsidiary Heritable.

Both district councils said the money accounts for only a small proportion of their total investments: 5% in the case of Rushmoor and 3% for Winchester.  This is part of a nationwide problem, as over £550 million has been invested in Icelandic banks by British local authorities, with over 70 councils affected.

The news came after Icelandic Internet bank Icesave suspended all 300,000 of its UK customer accounts earlier this week as a result of the worsening global financial crisis.  Personal customers of Icesave and other failed banks from Iceland have had the security of their savings guaranteed, but the same protection does not apply to the local government accounts.  The Local Government Association (LGA) is campaigning for the protection to extend to them as well, and this call was backed by Winchester City Council.