REYKJAVIK, Iceland - Iceland suspended trading on its stock exchange for two days and took control of the country's largest bank the third to be placed under its protective umbrella on Thursday as it grappled with a banking crisis that is threatening to engulf the entire country.
The Nordic nation's government also used sweeping new emergency powers to create a new bank that will take over the bulk of the domestic operations of another one of its collapsed banks.
The country is struggling to get a grip on the collapse of its top-heavy banking system, a situation that Prime Minister Geir H. Haarde has warned is putting Iceland at risk of "national bankruptcy."
