The financial crisis is now shaking many parts of Europe, while Iceland -- being among the very first to experience the weight of it -- may have come further in dealing with the consequences than many other countries.

At its meeting this morning, the Government met the National Police Commissioner and representatives of the Civil Protection Department, who presented an account of the security situation in the vicinity of the volcanic eruption in the Eyjafjallajökull glacier.

The Icelandic government welcomes the report published today by the Special Investigative Commission of the Parliament on the causes of the collapse of the Icelandic banking system. Consisting of independent experts, the investigative commission was established by the Icelandic parliament in December 2008.

Johanna Sigurdardottir, Prime Minister of Iceland, has sent the Polish Prime Minister, Donald Tusk, a letter of condolences on the death of President Lech Kaczynski and several Polish representatives in a plane crash in Russia this morning. In her letter, which is sent on behalf of the government and people of Iceland, the Prime Minister expressed her deep shock and heartfelt sympathy at the tragic loss today.

The Icelandic authorities will continue to work towards a satisfactory solution to the Icesave issue on this basis. The three governments have declared their intention to continue the talks and find a solution to the matter.

Ms. Jóhanna Sigurðardóttir, Prime Minister of Iceland met today with Mr. José Manuel Barroso, President of the European Commission and Mr Olli Rehn, Commissioner for Enlargement and Commissioner Designate for Economic and Monetary Affairs.

The governments of Iceland, the United Kingdom and the Netherlands have held regular consultations on the Icesave issue during the past few weeks. A delegation led by Iceland's Minister of Finance, Steingrímur J. Sigfússon, and the Chairmen of the opposition Progressive and Independece parties, Sigmundur Davíð Gunnlaugsson and Bjarni Benediktsson, left Iceland yesterday to meet with key counterparts in The Hague.

“I would like to emphasize that the Economic Programme in co-operation with the IMF should continue without interruption, even though a solution to the Icesave matter will be postponed because of the planned national referendum”, the Prime Minister of Iceland, Jóhanna Sigurdardóttir, said today in a letter to the Managing Director of the International Monetary Fund, Dominique Strauss-Kahn.

The Icelandic Parliament, Althingi, convened today to debate a Government bill regarding the preparation for a national referendum on the so-called Icesave legislation. This comes in the wake of the President of Iceland´s decision on 5 January not to sign into law a bill which provides for a state guarantee of loan repayments to the British and Dutch governments.

The Government of Iceland has decided to hold a national referendum on the so-called Icesave legislation, following broad consultations with both coalition and opposition parties as well as employers' associations and labor unions. The referendum is expected to take place late February.

The President of Iceland has declined to sign a law authorising a state guarantee for repayment of loans provided by the UK and the Netherlands to the Depositors' and Investors' Guarantee Fund, intended to cover payment of the minimum deposit guarantees to depositors in the UK and Netherlands branches of the failed Landsbanki Íslands hf.