Iceland: Financial System Stability Assessment

IMF Staff Country Reports, June 12, 2001

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Iceland: Financial System Stability Assessment

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Bibliographic details

• Published: June 12, 2001
• Series: IMF Staff Country Reports
• DOI: https://doi.org/10.5089/9781451819281.002

Summary findings

• Iceland has implemented a broad-based program of financial liberalization and market reforms.
• Iceland's conduct of monetary and financial policies is highly transparent, which contributes in an important way to the stability and efficiency of the financial system.
• Both macroprudential and microprudential indicators suggest that the system may be vulnerable to a macroeconomic shock.
• The Icelandic financial system is vulnerable to market risk and credit risk.
• The government intends to use the results of the assessment to strengthen their operations and enhance improvements to the regulatory framework.

Vulnerabilities and risks

• Macroprudential indicators and microprudential indicators both point to potential vulnerability to a macroeconomic shock.
• Specific areas of vulnerability identified:
  • Market risk
  • Credit risk

Policy intentions and recommendations

• Use the results of the assessment to:
  • Strengthen government operations.
  • Enhance improvements to the regulatory framework.

Content in this bundle

• Iceland: Financial System Stability Assessment - ISCR/01/83
  • Iceland: Financial System Stability Assessment - ISCR/01/83 (Markdown version)
  • Iceland: Financial System Stability Assessment - ISCR/01/83 (PDF)