Iceland's fisheries minister says the president has approved a proposal that makes him Iceland's new prime minister.
Sigurdur Ingi Johannsson has emerged from the presidential residence to tell reporters the news - a development that comes several days after his predecessor resigned after being linked to an offshore account.
Mr Johannsson said getting President Olafur Ragnar Grimsson's backing "is a good thing" that will allow the centre-right governing coalition to continue.
But the coalition faces a stiff challenge in parliament from opposition parties, which are demanding an immediate election after a scandal caused by former prime minister Sigmundur David Gunnlaugsson's use of offshore accounts.
The news came out after a massive leak of financial data involving a Panamanian law firm.