Reuters International

REYKJAVIK (Reuters) - Early counts indicated Icelanders on Saturday elected historian Gudni Johannesson as their first new president in 20 years amid distrust in politicians and business leaders following the 2008 global financial crisis and the Panama papers scandal.

Johannesson told supporters after around a third of votes were counted, showing about 38 percent support, that he thought he'd won the popular vote for the presidency, a largely ceremonial post although it carries powers to block legislation.

Contenders included a former prime minister and central bank governor.

Johannesson, a lecturer at the University of Iceland who has said he has never been a member of a political party, will take office on Aug. 1.

He has in his campaign advocated a constitutional clause allowing citizen-initiated referendums over parliamentary bills, saying it would help ensure the nation always had the final say in the largest issues affecting it.

Icelanders' faith in authorities was dented after they endured severe austerity measures and capital controls to restore a crashed economy when the country's largest banks collapsed in 2008 during the global financial crisis.

President Olafur Grimsson, 73, who has served five straight four-year terms, had been ahead in polls when in May he withdrew his candidacy after leaked documents from a law firm, dubbed the Panama papers, showed his wife had links to offshore accounts.

Grimsson had launched his candidacy citing a need for stability after then-Prime Minister Sigmundur Gunnlaugsson resigned in 2015 after the Panama papers showed he had owned an offshore company in a tax haven together with his wife.

Neither Gunnlaugsson nor Grimsson have been accused of doing anything illegal related to the offshore dealings, but the links still raised ire among many Icelanders, sparking demonstrations in the capital.

Iceland has been gradually recovering from the 2008 financial meltdown in recent years.

Economic growth is seen reaching 4 percent this year and unemployment is at a pre-crisis levels. But gross national income per capita is down by a quarter since 2007 and a tenth of the 330,000 Icelanders have fallen into serious loan default, with thousands of homes repossessed.

Candidates in presidential elections in Iceland run as independents.

The final count in Saturday's vote is due to be published later on Sunday.

(Reporting by Ragnhildur Sigurdardottir, Writing by Anna Ringstrom; Editing by Michael Perry)

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