Iceland’s Central Bank Bill Postponed Skip to content

Iceland’s Central Bank Bill Postponed

The government’s bill on changes to the senior management of the Central Bank was not passed by the Althingi parliament’s trade committee yesterday because Höskuldur Thórhallsson of the Progressive Party voted against it.

Thórhallsson decided to support the proposal of the Independence Party on not passing the bill until a new EU report on bank matters is released, Fréttabladid reports.

The Central Bank of Iceland. Copyright: Icelandic Photo Agency.

“We are expecting representatives of the International Monetary Fund, probably on Thursday,” said Prime Minister Jóhanna Sigurdardóttir. “There must be stability in the [Central] Bank’s operations so that the representatives of the IMF can have discussions with governors who are not about to leave the bank.”

Once the bill is passed by parliament, the current Central Bank governors will automatically be made redundant. “Renewal is necessary to restore the credibility of the Central Bank in Iceland and abroad,” the PM stated.

Sigurdardóttir said she was surprised to learn that the EU report had caused the delay. “I believe it is just a pretext on behalf of the Independence Party to delay this matter. I was very surprised that they made a proposal on waiting for that report when it isn’t even certain that it will arrive on Wednesday.”

Minister of Finance Steingrímur J. Sigfússon didn’t want to comment on whether this delay will influence the upcoming visit from the IMF representatives. “I can’t say. But they were scheduled to arrive in the latter part of this week and they are expecting various matters to be ready by then.”

Ángela Gavirira, IMF’s media representative, could not confirm to Fréttabladid that the IMF delegation will arrive in Iceland on Thursday.

Sigurdardóttir said the EU report is not of significant importance for the Central Bank bill, describing it as “first and foremost covering supervision on financial matters within the European Union and financial markets.”

“It has nothing to do with the topics that we are discussing in this bill, which is a change to the bank’s administration, that the governor is professionally appointed and establishing a monetary policy committee as other nations have done,” the PM explained.

Birgir Ármannsson, the representative of the Independence Party on the trade committee, stated that the report in question will be submitted to the EU’s executive committee tomorrow and thereafter be made public.

Ármannsson claimed that one of those who are working on the report had informed the trade committee of their schedule without revealing the report’s content.

Click here to read more about the Central Bank bill.

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