Lars Lagerback has signed a two-year contract extension with the Iceland national team.

The 65-year-old, who was appointed as the manager in October 2011, guided Iceland to the World Cup playoffs, where they were beaten by Croatia.

Lagerback will stay in charge of the team for their 2016 European Championship qualification campaign, before being succeeded by assistant manager Heimir Hallgrimsson.

"I expect to quit after this contract but would like to finish by making it to the EURO finals, even though we are in a difficult group since we will most likely be in the fifth pot of seeds," UEFA.com quotes him as saying.

Iceland are currently 46th in the FIFA World Rankings.