The financial crisis had its origins in the United States. The collapse of Lehman Brothers in autumn 2008 was followed by an acute crisis of confidence in financial markets worldwide. In the money markets, the banks almost stopped lending each other money.
Norway was among the countries that fared best through the financial crisis. The failure of the international financial markets nevertheless led to funding issues for Norwegian banks, and extensive governance measures were put in place.
When the Icelandic banks were placed under the administration of the Icelandic authorities, their Norwegian activities also faced problems. The Norwegian Banks' Guarantee Fund provided liquidity for the Norwegian subsidiary, Glitnir Bank ASA, for a short period conditioned on the bank being sold. Glitnir Bank ASA was then sold to a group of SpareBank 1 banks. The crisis in Kaupthing meant that more than 5,000 depositors in the bank's Norwegian branch could not withdraw their deposits, and the Icelandic guarantee scheme had major problems. Since the branch was also a member of the Norwegian deposit guarantee scheme, customers also had a guarantee for deposits between the Icelandic cover amount of approx. NOK 175,000 and the Norwegian coverage amount of NOK 2 million. The Norwegian government advanced the payout of the deposits which, according to the rules, were to be covered by the Icelandic scheme and, together with the cover from the Norwegian deposit guarantee scheme, the customers received full cover for deposits up to NOK 2 million.