Iceland’s stock exchange lost about 90% of its value during the 2008 financial crisis.
The collapse followed the failure of Iceland’s large banks, whose balance sheets had expanded to several times the country’s economic output. When international credit markets froze, the banks could not refinance their liabilities and the Icelandic financial system came under extreme pressure.
The OMX Iceland 15 index fell approximately 90% from its 2007 peak to its 2008 low. Trading was temporarily suspended in October 2008, and the index was later adjusted to remove the failed banks that had dominated its earlier composition.
This figure describes Iceland’s equity market, not a 90% fall in the country’s gross domestic product or currency. Iceland’s banking collapse was part of the global crisis, but its small economy and exceptionally large banking sector made the shock especially dramatic.