Central Bank Act to be reviewed

This morning, at a Cabinet meeting, the Minister of Finance and Economic Affairs presented and introduced a memorandum on the review of the Act on the Central Bank of Iceland, no. 36/2001.

Some experience has been gained of the structure implemented with the amendments to the Central Bank Act passed in February 2009. In the opinion of the Minister of Finance and Economic Affairs, it is timely to review those amendments and other aspects of the Central Bank Act. It is also important to examine whether there is reason to make changes to the structure of the financial market and the Financial Supervisory Authority, in order to strengthen the collaboration between the Financial Supervisory Authority and the Central Bank and to clarify the division of tasks between the two institutions.

The Minister of Finance and Economic Affairs will appoint a work group to make an assessment of desirable changes. The group's objective will be to reaffirm the Bank's credibility and independence and enhance confidence in the Icelandic economy.

Concurrent with a decision to review the Act on the Central Bank of Iceland, the Governor of the Central Bank has been notified, with reference to Article 23, Paragraph 2 of the Act on the Rights and Obligations of Civil Servants, no. 70/1996, that it has been decided to advertise for applications for the position of Governor. This is done to give the authorities increased scope in relation to potential amendments to the Central Bank Act.