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Financial watchdogs prepare for emergencies

An ad-hoc committee of six people appointed by the Central Bank of Iceland, the Financial Supervisory Authority (FME) and three ministries has submitted proposals on how to coordinate government actions in the event of a financial crisis.

Morgunbladid reports that the committee has recommended, among other things, that the FME be given greater powers to seize control over financial institutions in certain circumstances by replacing board directors, managers or auditors.

The committee also recommends greater cooperation with the institutions of the European Union.

The committee has examined several contingencies, including how to react if the Icelandic banks are unable to finance themselves abroad.

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