Reykjavik - Germany on Thursday welcomed Iceland's agreement with the International Monetary Fund (IMF) on a 2.1-billion-dollar loan to tide it over a major financial crisis.

The deal paves the way for a quick settlement with some 30,000 German depositors in Kaupthing Bank, one of the North Atlantic nation's three main banking groups that recently collapsed over the global credit crunch.

Germany's Finance Ministry said it welcomed "Iceland's commitment to meet its obligations to depositors and ensure the fair, equal and non-discriminatory treatment of creditors."

Germans savers deposited 300 million euros (378 million dollars) in Kaupthing Bank, lured by high promises of interest on overnight money accounts and fixed-term deposit accounts.

At the weekend, Iceland said it had agreed to reimburse British and Dutch depositors of failed internet bank Icesave, operated by the collapsed Landsbanki Bank.

Germany said it was cooperating with Britain and the Netherlands to "work constructively in the continuing negotiations with Iceland to conclude agreements on pre-financing that enables Iceland to meet its obligations towards depositors shortly." (dpa)