Central Bank of Cooperate with Foreign Banks? Skip to content

Central Bank of Cooperate with Foreign Banks?

Prime Minister Geir H. Haarde said during the general meeting of the Central Bank of Iceland on Friday that the feasibility of a cooperation with central banks in countries where the Icelandic commercial banks have operations is being researched.

Haarde also said it would be natural for the state treasury to take loans in foreign currency to strengthen the Central Bank’s reserves of foreign currency. “I have said before that it is natural to continue along that pathway and I’d like to emphasize that now.” Fréttabladid reports.

The prime minister added it would soon be timely to undertake a theoretical study of the monetary policy of the Central Bank and the execution of the laws behind it.

“To undertake that project we need the best qualified specialists, foreign and native,” Haarde said, emphasizing that such a study should not be considered as criticism of the Central Bank’s operations, but rather as a tool to assist it in performing its duties.

Yngvi Örn Kristinsson, managing director of the securities division at Landsbanki Bank, told Fréttabladid he finds the prime minister’s words sensible and likely to have a positive influence on the economy.

Kristinsson said it is important to cooperate with foreign central banks and to increase the Central Bank’s reserves of foreign currency. He said the prime minister’s speech shows that the government is prepared to improve Iceland’s economic situation.

Click here to read an interview with Prime Minister Haarde on the Icelandic economy.

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