Greece election: EU and Germany firm on Athens bailout

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27. Iceland borrowed billions from the IMF in addition to accepting IMF austerity measures.

The problem in Iceland was domestic banks

They solved their problem by:

1. Restructuring domestic banking
2. Accepting IMF help.
3. Applying for EU membership to improve their credibility with the international financial markets.

Do you want Greece to fix their problem like Iceland now?

Iceland's financial position has steadily improved since the crash. The economic contraction and rise in unemployment appear to have been arrested by late 2010 and with growth underway in mid 2011.[187] Three main factors have been important in this regard. First is the emergency legislation passed by the Icelandic parliament in October 2008. It served to minimise the impact of the financial crisis on the country. The Financial Supervisory Authority of Iceland used permission granted by the emergency legislation to take over the domestic operations of the three largest banks.[188] The much larger foreign operations of the banks, however, went into receivership.

A second important factor is the success of the IMF Stand-By-Arrangement in the country since November 2008. The SBA includes three pillars. The first pillar is a program of medium term fiscal consolidation, involving painful austerity measures and significant tax hikes. The result has been that central government debts have been stabilised at around 80–90 percent of GDP. A second pillar is the resurrection of a viable but sharply downsized domestic banking system on the ruins of its gargantuan international banking system which the government was unable to bail out. A third pillar is the enactment of capital controls and the work to gradually lift these to restore normal financial linkages with the outside world. An important result of the emergency legislation and the SBA is that the country has not been seriously affected by the European sovereign debt crisis from 2010. Despite a contentious debate with Britain and the Netherlands over the question of a state guarantee on the Icesave deposits of Landsbanki in these countries, credit default swaps on Icelandic sovereign debt have steadily declined from over 1000 points prior to the crash in 2008 to around 200 points in June 2011. The fact that the assets of the failed Landsbanki branches are now estimated to cover most of the depositor claims has had an influence to ease concerns over the situation.

Finally, the third major factor behind the resolution of the financial crisis was the decision by the government of Iceland to apply for membership in the EU in July 2009. While views on the feasibility of EU membership are quite mixed in Iceland, this action has served to enhance the credibility of the country on international financial markets. One sign of the success of the above efforts is the fact that the Icelandic government was successfully able to raise $1 billion with a bond issue on 9 June 2011. This development indicates that international investors have given the government and the new banking system, with two of the three biggest banks now in foreign hands, a clean bill of health.[189][190] The first two major measures were implemented by the government of Geir H. Haarde but carried out by also the government of Johanna Sigurdardottir, which then took the step to apply for EU membership.

http://en.wikipedia.org/wiki/2008%E2%80%932012_Icelandic_financial_crisis#Development