The Financial Stability Committee makes decisions on the application of the Central Bank of Iceland's policy instruments to promote and strengthen financial stability.
Examples of these instruments include rules on capital buffers, foreign exchange balances, liquidity and stable funding, and rules that limit the risk that borrowers may take, such as restrictions on loan-to-value ratios and mortgage debt-to-income ratios.
The committee consists of the Governor, three Deputy Governors and three external experts. In addition, the permanent secretary to the ministry responsible for financial stability issues shall have a seat at the committee's meetings with the right to speak and make proposals, but without the right to vote.