17 August 2010

Ministries, Central Bank and Financial Supervisory Authority sign Agreement on Financial Stability and Preparedness

The Prime Minister, Minister of Finance, Minister of Economic Affairs, governor of the Central Bank and director of the Financial Services Authority signed an agreement establishing the committee on financial stability. This agreement is based on a previous agreement between the ministries and institutions from 2006 which addresses cooperation in the field of financial stability and financial crisis prevention.

The committee on financial stability shall enhance cooperation, facilitate the exchange of information and increase preparedness to maintain financial stability and coordinate crisis prevention efforts. The committee also induces more transparency regarding the institutions individual and shared responsibilities and areas for cooperation. The committee acts has an advisory role and is not a decision making body but is expected to offer action plans and policy proposals to the government when the need arises. The agreement has no impact on the roles and responsibilities given to each ministry or institution or the authority and obligation of each party to take appropriate action.

The committee will, among other things, discuss trends and prospects for financial markets, cooperation and government policy in the context of potential financial crisis situations, changes to law, regulation or conduct which has direct impact on the committee’s area of responsibility and developments in the international arena, in particular with respect to cooperation with other countries under the EEA agreement. The committee will be able to organize and participate in exercises regarding crisis management and preparedness. It will also coordinate cooperation with counterparts in the other Nordic and EEA countries, acting as a “Domestic Standing Group” for the Icelandic authorities.

The committee is chaired by the Ministry of Economic Affairs, with other members from the Ministry of Finance, Prime Minister’s Office, Financial Services Authority and the Central Bank.

For further information please contact the Ministry of Economic Affairs.

No. 21/2010
16 August, 2010