Iceland's financial system is on solid footing, the Nordic country's central bank said in a report on Wednesday.

"The systemically important banks have delivered solid results and they have supported households and businesses. Their capital and liquidity positions are strong," the central bank said.

Iceland's inflation will however be "stubbornly high" while debt service burdens will grow heavier, it added. (Reporting by Louise Breusch Rasmussen, editing by Terje Solsvik)