According to World Economic Forum's Global Competitiveness Report 2017-2018, financial market development in Iceland is scored 4.2 out of maximum 7.0 and ranked 49th out of 138 analysed economies, trustworthiness and confidence of financial market is scored 4.3 (66th place).
Chart 1. Financial Market Development in Iceland. Source: WEF.
Soundness of banks is scored 4.9 bringing Iceland into the 67th place.
Chart 2. Soundness of Banks in Iceland. Source: WEF.
Banks in Iceland are mainly focused on the following areas:
Currently there are 9 credit institutions operating in Iceland.
Recent structural changes (2013 - 2017) of the banking sector of Iceland are summarised in Table 1.
|Number of Opened Banks||0||0||1||0||0|
|Number of Closed Banks||1||1||4||0||0|
Table 1. Recent structural changes in the banking sector of Iceland.
The list of the most recently opened banks in Iceland is provided in Table 2.
|Sparisjóður Austurlands hf (new)||January 2015|
Table 2. The most recently opened banks in Iceland.
All the credit institutions operating in Iceland can be classified into several categories. Table 3 summarises the number of banks in each category.
|Category||Number of Banks|
Deposit guarantee scheme is a financial stability mechanism implemented in many countries to protect bank depositors against the loss of their deposits in the case when a bank is unable to meet its obligations to depositors by compensating certain deposits held by depositors of the bank. This compensation is paid out from the contributions which banks have made into a deposit guarantee fund.
From a depositor's point of view it is important to know:
All these details about deposit guarantee scheme in Iceland are summarised in Table 4.
Table 4. Deposit guarantee scheme in Iceland.
EEA stands for European Economic Area and consists of all EU member states plus Liechtenstein, Norway and Iceland.
Moody's country ceilings for deposits specify the highest rating that can be assigned to local- or foreign- currency denominated deposit obligations of a bank or other deposit taking institution domiciled within that country.
Local currency (Icelandic króna) deposit ceiling for Iceland is set to A1 (upper medium grade), foreign currency deposit ceiling is A3 (upper medium grade).