This stronghold in the northwest corner of Falena is rich in history, having once been the capital of the Queendom, hundreds of years ago. The castle and both sections of the city are completely surrounded (not to mention separated) by a moat, giving it a great natural protection against invading armies Stormfist's own Sacred Games were arguably the most important events in the country, picking royalty and shifting power between factions every time a future queen needed a husband. The Games are tied so closely to the city (possibly because of the large arena), that they continued to stay in the city, even after the capital was moved to Sol-Falena roughly IS 237. This gives whatever power reigning in Stormfist (which at that time was the Aethelbald family, who was given control of the city when the capital moved) a guaranteed sense of authority and importance, which nobody else can have. The Godwin family got the idea, and through a series of schemes, took power from the Aethelbalds in roughly IS 349, and have ruled Stormfist ever since.
Stormfist's great distance from the greatest of Falena's enemies, the New Armes Kingdom, gave each Godwin ruler a distinct card to play in Falenan politics. Hawkish positioning towards Armes was safer for the people of Stormfist, as they would be the last to fall. The ruler of the eastern, more vulnerable cities would look weak in the Senate if they didn't want to go to war, an opportunity which the lords of Stormfist capitalized on.
The city is divided into the old town, filled with the old residents and hardline supporters of the Godwin faction, and the new town, which houses the younger and more moderate populace. There are some tensions between the two groups, and it shows when the Prince's army takes the city. Many in the new town accept their new leaders, while much of the population of the old town are still waiting for their Godwin saviors to come back and liberate them.
They even played the Prince with the plot of Suikoden V, which was really just a crazy scheme to get the Aethelbalds out of their sewers for some time. Joke's on them though....he came back!