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Islandsbanki hf. : 1Q2015 Interim Consolidated Financial Statements

Profit after tax was ISK 5.4bn in 1Q15 compared to ISK 8.3bn in 1Q14. The difference is mainly due to irregular items.


1Q 2015

  • Profit after tax was ISK 5.4bn in 1Q15 compared to ISK 8.3bn in 1Q14. The difference is mainly due to irregular items. 
  • Return on equity was 11.8% in 1Q15 compared to 19.3% in 1Q14. 
  • Total capital ratio remains strong at 28.4% (YE14 29.6%) and Core Tier 1 ratio was 25.7% (YE14: 26.5%)
  • Net interest income amounted to ISK 6.2bn in 1Q15 (1Q14 ISK 6.6bn), a decrease of 6.8%. The net interest margin was 2.7% in 1Q15 (1Q14: 3.0%). Main factor is lower inflation.
  • Net fee and commission income was ISK 2.9bn in 1Q15 (1Q14: 2.9bn). 
  • Administrative cost was down 1.5% or 2.6%in real terms. Cost to income ratio was 55.3% in 1Q15 (1Q14: 55.1%). Cost to income-ratio excludes Bank tax and one-off cost items. 
  • Leverage ratio was at 19.7% at the end of the period, indicating a moderate leverage.
  • Ratio of loans more than 90 days past due and impaired was 3.0% (YE14: 3.5%).
  • Total assets amounted to ISK 926bn (Dec14: ISK 911bn). 

Birna Einarsdóttir, Chief Executive Officer at Íslandsbanki:

'We are pleased with the first quarter results which exceed our expectations. It is important to continue to strengthen the return on equity from regular operations and to this extent, the Bank has continued to reduce costs. The Bank's performance has resulted in a ratings upgrade by Fitch Ratings to investment grade with stable outlook. Thereby, Íslandsbanki becomes the first bank in Iceland to be assigned an investment grade since 2008, which is expected to deliver more favourable terms in upcoming bond issuances.
Icelandic corporates are increasingly investing in risk management products to minimise operational risks and to ensure a more secure work environment. This is evident from the increase in sale of risk management products at Markets, a clear sign of recovery in the capital markets.

The year on year increase in new mortgage lending was 60% and we see a growing demand from first time buyers.

There has been a notable shift in the type of services offered within the branch network, where we see an increase in customers seeking financial consultation whilst day-to-day transactions are being carried out through online and mobile devices. As a part of the Bank's strategy of streamlining operations, two downtown branches were merged into one branch, opened this week. The new branch focuses on meeting customer expectations with an emphasis on providing excellent service to our customers.'

Investor Call in English

The Bank will host an investor call in English to present the results at 1 pm Icelandic time. The call will start with a short macro update on the Icelandic economy, followed by a review of the financial results and Q&A. Please register by replying to Dial-in details and presentation will be sent out two hours prior to the call.

All presentation material will subsequently be available and archived on

Jón Guðni Ómarsson, CFO of Íslandsbanki goes over the financial results of Q1 2015.


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