Iceland’s ruling coalition resigned Monday, three months after the collapse of the country’s currency, stock market and several major banks, and following months of public protests, Kristjan Kristjansson, a spokesman for the prime minister told CNN.

Iceland’s Prime Minister Geir Haarde, left, talks with business minister Bjorgvin Sigurdsson in October.  The minister, Bjorgvin Sigurdsson, resigned Sunday, saying the government had failed to restore confidence in the three months after the collapse of the financial system.

Senior government officials from the two parties that make up Iceland’s coalition government — the prime minister’s Independence Party and the Social Democrats party — had met Sunday to discuss the government’s future but nothing was resolved, a spokesman for the prime minister said.

Sigurdsson’s resignation followed Saturday’s peaceful demonstration in which about 6,000 to 7,000 people in front of the parliament building called for the government of Prime Minister Geir Haarde to step down.

Iceland’s financial system and currency collapsed in October following a series of bank failures, forcing the International Monetary Fund to intervene.  Iceland sought IMF help after its government was forced to nationalize three banks to head off a complete collapse of its financial system.

In his resignation letter, Sigurdsson said after the country’s financial crash, he hoped the government would re-create trust and restore the country’s finances.

Our question is, how do you bailout an entire country and what happens next?

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Tags: Bjorgvin Sigurdsson, Coalition government, Geir Haarde, Iceland, Independence Party, International Monetary Fund, Prime minister, Social Democrats

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