Plunging equity prices in Iceland are unlikely to curb interest in tapping the stock market for funds, according to the head of the nation’s exchange, even as capital controls imposed in 2008 risk creating an asset bubble.
Iceland advertised the position of central bank governor after the current incumbent Mar Gudmundsson questioned the government’s intention to push through the world’s biggest household debt relief program.
Iceland’s decision to advertise the position of central bank governor and plans to change the bank’s management jeopardize financial stability and upset the removal of capital controls, according to a central banker.
Iceland Finance Minister Bjarni Benediktsson said his country hasn’t yet decided whether it can commit to an election pledge to drop its European Union accession bid as it awaits the findings of a report.
The party ousted from government in 2009 after presiding over Iceland’s financial meltdown emerged as the biggest winner in the weekend’s parliamentary elections as talks start to form a ruling coalition.
More than five years after its biggest banks defaulted on $85 billion, Iceland’s government is refusing to speak to the hedge funds and other creditors that are still trying to get their claims paid out.