One of the Central Bank of Iceland’s main tasks is to promote a safe, stable, and effective financial system. Financial stability means that the financial system is equipped to withstand shocks to the economy and financial markets, ensure the availability of capital, mediate credit and payments, and redistribute risks appropriately. A healthy financial system is a prerequisite for stability, output growth, and effective monetary policy. Twice a year the Bank’s Financial Stability Department conducts an in-depth appraisal of the macroeconomic environment, financial markets, financial institutions, and payment systems. The results are published in the Bank’s Financial Stability report.