Minister of Finance Bjarni Benediktsson Resigns

Independence Party MP Bjarni Benediktsson has resigned as Minister of Finance, he announced in a press conference this morning. The announcement comes in the wake of a ruling from the parliamentary ombudsman stating that Bjarni was not qualified to handle the recent sale of shares in Íslandsbanki to private investors.

Among the issues highlighted by the ombudsman was that a company owned by Bjarni’s father was one of the buyers acquiring a 22.5% share in the bank in March 2022.

READ MORE: How Not To Sell A Bank

“I believe it is important to respect the opinion of the Parliamentary Ombudsman, who is a special trustee of the Parliament. I say this, even though I have my opinions, arguments and conclusions,” Bjarni said. “The opinion should be respected.”

“And the opinion is that I lost my competence in the case. I intend to respect this decision, and I believe that, in light of these results, I am being tried to continue working as Minister of Finance during the sale of the state.”

A long time coming

Official condemnation of the Íslandsbanki sale is in line with public opinion on the situation. In April 2022, a Gallup poll found 68% of respondents believed the law was broken in the selling of that 22.5% stake in the bank.

An audit conducted by the Icelandic National Audit Office (INAO) in November 2022 found that the sale of that percentage of the bank was deeply flawed, stating that numerous mistakes were made in the sale process, in particular with Icelandic State Financial Investments (ISFI).

Íslandsbanki had been owned by the Icelandic treasury since the wake of the 2008 financial crash, but Bjarni had been very keen on selling shares of the bank to private interests again. The March 2022 sale of shares amounting to a 22.5% stake in the bank has caused considerable criticism, not least of all when it was revealed that one of the share buyers in the closed and discounted sale of shares was none other than Bjarni’s father.

The shares themselves were sold a steep discount at a price set by ISFI. This drew criticism from INAO, who said that ISFI should have set the highest possible price for the shares instead of offering them at a reduced price. The report adds furthermore than ISFI did not adequately prepare for the sale, and did not do enough to inform Parliament of the nature of the sale.

What does it all mean?

Considering the laundry list of scandals Bjarni has amassed over his 20 years in politics, and the ease with which they’ve slipped off his teflon coating, the fact that he is stepping aside now has political watchers at the Grapevine uneasy. Is this Íslandsbanki report actually Bjarni’s lifeboat, shuttling him to safety (or away from accountability) before Iceland’s next economic implosion? Time will tell.