Iceland and the International Monetary Fund Intent. The conditionalities include details of Banking Sector restructuring, changes to Fiscal Policy including government austerity and changes to exchange rate policies. Following the global financial crisis in 2007-2008 Iceland's banking sector collapsed leading to wide ranging unemployment and a lessening of support for the Icelandic currency - the Icelandic Krona ISK. This was triggered by an insolvency of the private banking sector. The largest Icelandic banks had liabilities in excess of 80 percent of GDP . Iceland requested assistance from the IMF and from its Nordic partners in the Nordic Council. The goal of Iceland in this market intervention
Central Bank of Iceland 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. 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. Central Bank of Iceland The Central Bank of Iceland () is the central bank or reserve bank of Iceland. It has served in this capacity since 1961, when it was created by an act of the Alþingi out of the central banking department of Landsbanki Íslands,