It is interesting to read about it now thought. I was young when this was going on, so didn't really understand what was going on. From what I gather thought, 23 of the Norwegian banking sector was verging on bankrupcy because of a set of factors eerily similar to some advanced economies I know: First of all, the private banks increased their loan portfolio threefold in half a decade, after the government liberalised the banking regulations. Then, the economy started slowing in the late eighties, especially in IT and oil, two areas of big importance for Norway. Soon after, the norwegian housing boom, fed on by the increased aviability of cheap loans, collapsed. (About 20 percent of the bad loans were to private customers) The housing prices would take almost a decade to recover. (And that in a steadily growing economy)

Sources: (unfortunately in Norwegian)
http://www.nrk.no/underholdning/store_norske/4704274.html
http://www.ssb.no/00/aar2000/art-1999-11-10-01.html