The Financial Stability Committee (FSN) of the Central Bank of Iceland takes decisions on the application of the Bank’s financial stability policy instruments. Financial stability means that the financial system is equipped to withstand shocks to the economy and financial markets, to intermediate credit and payments, and to diversify risks appropriately.
At its meeting of 28 November and 1 and 2 December 2025, the Committee was given a presentation on developments and prospects for the economy and for financial stability. Members discussed key risks to financial stability in Iceland, as well as global developments. Among other topics, they reviewed developments in domestic and foreign financial markets, the pension funds’ investment strategies, private sector indebtedness, the real estate market, and financial institutions’ resilience, including their capital and liquidity positions. The Committee also discussed scenarios for the Central Bank’s year-2026 stress test on the systemically important banks. It discussed borrower-based measures, both in general and in connection with 4 real estate firms’ and funds’ participation in individuals’ home purchases. Furthermore, the FSN discussed the updated assessment of which credit institutions were considered systemically important. Moreover, the Committee was given a presentation on factors pertaining to cyber- and operational security in the financial market and oversight of systemically important financial market infrastructure.