West Ham owner Bjorgolfur Gudmundsson insists the club's finances are secure, despite Iceland's second-largest bank going into administration.

Gudmundsson is a major shareholder in Landsbanki and chaired the company until he was sacked yesterday when the government took control to stop it collapsing.

Landsbanki is a victim of the worldwide credit crunch but West Ham chief executive Scott Duxbury is confident of the club's future.

"The position of Landsbanki has absolutely no effect on West Ham and Mr Gudmundsson's ownership of the club," he said,

However, the financial situation means new manager Gianfranco Zola will have his hands tied come the January transfer window and the Italian has be told he must sell players before he buys.

It could even lead to the departure of England striker Dean Ashton and Wales international Craig Bellamy, who may be sold to make way for fresh blood.

Asgeir Fridgeirsson, the club's vice-chairman, admitted: "We have a big squad. Our manager feels it is not necessary to be that size, so if further transfers are needed, money would need to be generated from sales.

"There is no reason to be too pessimistic. It is a blow for him [Gudmundsson] and his financial strength but he has numerous other investments which are doing well, so there is no reason to fear he will not fulfil his commitment to West Ham.

"Mr Gudmundsson has already put £30million into the club and that money is still there. He has invested in creating a squad capable of challenging for the top half of the Premier League.

"One thing he is sure of is that this will have no implications on the other investments of him and his family."

By chance, that is precisely the figure Sheffield United are pushing for as part of their compensation from the Carlos Tevez transfer affair.

Despite the financial pressures imposed on the billionaire, Gudmundsson has no intention of selling the club - for now.

Fridgeirsson added: "There is enormous interest in the club but at the moment we are not actively in the process of selling. There is not a need.

"There have been agents all around the club trying to get our attention but we have turned them away."