Iceland’s central bank chief refuses to leave

Agence France-Presse

"The prime minister wants to profess much disappointment with the governor's stand in the matter," Johanna Sigurdardottir's office said in a statement late Sunday after central bank chief David Oddsson refused to heed her request to quit.

"It is obvious that the governor does not agree with the government that changes in the central bank now will create trust and confidence in the bank," the statement added.

Sigurdardottir had sent a letter to the three governors of the central bank - Oddsson, Ingimundur Fridriksson and Eirikur Gudnason Ğ Feb. 2, just a day after she was appointed interim prime minister. She had demanded a reply by Feb. 5.

The prime minister appoints the central bank governors but has no power to fire them.

"I have never run away from any project I have undertaken and I will not do that now," Oddsson said in a four-page letter to Sigurdardottir published on the central bank's Web site. Many Icelanders have held Oddsson, 61, particularly responsible for the country's economic crisis, with mounting public protests in recent months calling for his dismissal.

Oddsson liberalized Iceland's financial markets in the 1990s when he served as prime minister.Thousands of Icelanders lost their savings and jobs after the country's once-booming financial sector crumbled in October, with the government forced to take control of the three biggest banks as Iceland's currency lost half its value.