Central Bank of Iceland

Central Bank of Iceland
Seðlabanki Íslands

Headquartes of the bank
Headquarters	Kalkofnsvegur 1, Reykjavík
Established	7 April 1961 (1961-04-07)
Ownership	100% state ownership [1]
Governor	Ásgeir Jónsson
Central bank of	Iceland
Currency	Icelandic króna ISK (ISO 4217)
Reserves	4.790 billion USD [1]
Preceded by	Landsbanki Íslands
Website	cb.is (in English) sedlabanki.is (in Icelandic)

Iceland bonds had an Inverted yield curve in 2008

  10 year bonds

  5 year bonds

  2 year bonds

The Central Bank of Iceland (Icelandic : Seðlabanki Íslands, pronounced [ˈsɛðlaˌpauŋcɪˈistlan(t)s] ) is the central bank or reserve bank of Iceland. It is owned by the Icelandic government, and is administered by a governor and a seven-member supervisory board, elected by the country's parliament following each general election. ^[2] It has the sole right to issue notes and coins of Icelandic krónur and to manage the state's foreign currency reserves.

History

The Central Bank of Iceland was created in 1961 by an act of the Alþingi out of the central banking department of Landsbanki Íslands, which had been the island's sole bank of issue since 1927 and had conducted only limited monetary policy.

The Central Bank Act of 1986 eliminated the ability of the Central Bank to regulate the interest rates of commercial banks and savings banks.

Though nominally independent, the Central Bank of Iceland was historically expected to follow the lead of the central government. In 2001, however, a floating exchange rate policy was introduced and since then the Central Bank has been empowered to adopt an inflation target and manage monetary policy so as to achieve price stability independent of the policies of the central government.

In 2015, after the 2008–2011 Icelandic financial crisis, the government of Iceland considered "a revolutionary monetary proposal" to abolish private money creation and to end to fractional-reserve banking. ^[3] Similar to the Swiss Sovereign Money Initiative, this plan would remove the power of money creation from the commercial banks and give it to the Central Bank of Iceland. ^[3] The option was not implemented.^{[ citation needed ]}

On 1 January 2020, the Central Bank of Iceland absorbed the Financial Supervisory Authority, previously an independent institution established in 1999. ^[4]

Leadership

#	Governor	Took office	Left office	Tenure length
1	Jóhannes Nordal	1961	1993	31–32 years
2	Jón G. Maríasson	1961	1967	5–6 years
3	Vilhjálmur Þór	1961	1964	2–3 years
4	Sigtryggur Klemensson	1966	1971	4–5 years
5	Davíð Ólafsson	1967	1986	18–19 years
6	Svanbjörn Frímannsson	1971	1973	1–2 years
7	Guðmundur Hjartarson	1974	1984	9–10 years
8	Tómas Árnason	1985	1993	7–8 years
9	Geir Hallgrímsson	1986	1990	3–4 years
10	Birgir Ísleifur Gunnarsson	1991	2005	13–14 years
11	Jón Sigurðsson	1993	1994	0–1 years
12	Steingrímur Hermannsson	1994	1998	3–4 years
13	Finnur Ingólfsson	2000	2002	1–2 years
14	Ingimundur Friðriksson	2002	2003	0–1 years
15	Jón Sigurðsson	2003	2006	2–3 years
16	Eiríkur Guðnason	1994	2009	14–15 years
17	Davíð Oddsson	2005	2009	3–4 years
18	Ingimundur Friðriksson	2006	2009	2–3 years
19	Svein Harald Øygard	2009	2009	0 years
20	Már Guðmundsson	2009	2019	9–10 years
21	Ásgeir Jónsson	2019	Incumbent	5–6 years

See also

• 2008–2011 Icelandic financial crisis
• Economy of Iceland
• Financial Supervisory Authority (Iceland)
• Icelandic króna
• List of central banks

• Banks portal

References

1. Weidner, Jan (2017). "The Organisation and Structure of Central Banks" (PDF). Katalog der Deutschen Nationalbibliothek.
2. "Leadership and organisation of the Central Bank of Iceland". www.sedlabanki.is. Archived from the original on 29 September 2011. Retrieved 8 May 2012.
3. Agence France-Presse, "Iceland looks at ending boom and bust with radical money plan", The Daily Telegraph , 31 March 2015 (page visited on 13 April 2018).
4. "Financial Supervisory Authority and Central Bank of Iceland merge". Central Bank of Iceland. 2 January 2020.

External links

• Official website Archived 19 November 2005 at the Wayback Machine (in English)
• Official website (in Icelandic)

64°08′56″N21°55′55″W / 64.14889°N 21.93194°W / 64.14889; -21.93194