Icelandic investment group Baugur has moved to reassure the financial markets after a major shareholder filed for administration earlier this week, and says it is business as usual for the firm which owns a number of British high street fashion chains.

The company was caught up in the nationalisation of Glitnir, the country's third-largest bank, after the bank's major shareholder Stodir - an investment company owned by Baugur billionaire Jon Asgeir Johannesson - was forced to file for administration.

The move led to speculation that there would be some disruption for Baugur and its huge retail interests - particularly in servicing its borrowings and generating extra credit.

But Baugur, which owns UK fashion retailers including House of Fraser, Karen Millen, Oasis and Principles, says its assets are based in the United Kingdom, Scandinavia and the United States and "as such have no exposure to the Icelandic economy."

Gunnar Sigurdsson, chief executive of Baugur, said in a statement: "At the same time the funding for these businesses is secure and the vast majority of this funding is through international banks with whom Baugur has a long working relationship.

"Our businesses continue to perform well in what are evidently tough market conditions."

Yesterday the Mosaic fashion firm, which is 49%-controlled by Baugur and operates the Oasis, Warehouse and Karen Millen retail brands, said first-half loss widened to GBP12.9m (US$22.8m) on flat sales.

Baugur also has stakes in Debenhams, Moss Bros and French Connection.