Risks to financial stability in Iceland have increased because of worsening external conditions, the central bank said in a statement on Wednesday.

"The global economic outlook is highly uncertain, and global economic development could adversely affect the Icelandic economy in the coming term," the central bank said.

"Risks to financial stability in Iceland have therefore increased," it added. (Reporting by Nikolaj Skydsgaard, editing by Stine Jacobsen)