Icelandic prime minister Sigmundur Gunnlaugsson resigned Tuesday, after condemning revelations in the Panama Papers that landed him and his wife in hot water.
Sigurdur Ingi Johannsson, who is also currently minister of fisheries and agriculture, told reporters that the progressive party will suggest to its coalition partners in the Independence Party that he should become the new prime minister.
The prime minister asked the president earlier on Tuesday to dissolve parliament in the face of a looming no-confidence vote and protests, after leaked files showed his wife owned an offshore firm with big claims on the country's collapsed banks.
On Monday, the opposition filed a motion of no-confidence and thousands of Icelanders gathered in front of parliament, hurling eggs and bananas and demanding the departure of the leader of the center-right coalition government, in power since 2013.
Gunnlaugsson would be the first casualty of the "Panama Papers" a leaked collection of documents revealing the financial arrangements of politicians and public figures from around the world.
The prime minister has stressed his wife's overseas assets were taxed in Iceland and that he had put the interest of the public before his own in dealing with the financial claims.
But his opponents say it amounts to a conflict of interest and say he should have been open about the overseas assets and the company, especially since the government is involved in striking deals with claimants of the bankrupt banks.
A government spokesman has said the claims against Iceland's collapsed banks held by the firm owned by the prime minister's wife - in which he also temporarily held a stake - totalled more than 500 million Icelandic crowns ($4.1 million).
Iceland's main commercial banks collapsed as the global financial crisis hit in 2008 and many Icelanders have blamed the North Atlantic island nation's politicians for not reining in the banks' debt-fuelled binge and averting a deep recession.