Operations in accordance with the appropriate laws and regulations

Íslandsbanki is a financial company and operates in accordance with relevant regulations in the field of financial markets, which frame its governance. The main laws that apply to the bank's operations are the Act on Public Limited Companies No. 2/1995, Act on Financial Undertakings No. 161/2002, Act on Securities Transactions No. 108/2007 and the Act on Measures against Money Laundering and Terrorist Financing No. 64/2006.

Act on Public Limited Companies 

Icelandic public limited company law is primarily based on European company law. Icelandic companies are obliged to register with Iceland Revenue and Customs's company register, specify who sits on the board, their managing director's name, and submit its articles of association.

The Public Limited Companies Act contains information on corporate activities, equities, organizational structure, annual general meetings, auditing and management responsibilities.

Act on Financial Undertakings

Íslandsbanki is a commercial bank and therefore operates in accordance with the Act on Financial Undertakings. The Financial Supervisory Authority (FME) is the supervisory body for financial companies in Iceland. The FME issues operating licenses, monitors financial company activities and ensure that appropriate regulations and sound business practices are followed.

The Act on Financial Undertakings deals with operating licenses, holdings and share capital, auditing, risk management, other internal regulations, and management competence.

Act on Securities Transactions

The legislation is based on the European Union (EU) Directive on Markets in Financial Instruments Directive (MiFID). This Directive entails major changes to the rules on securities transactions within the European Economic Area (EEA) and they affect the relations between financial undertakings and their clients.

Law on Measures against Money Laundering and Terrorist Financing

The purpose of the Act is to prevent money laundering and terrorist financing by obliging parties engaged in activities that may be used for money laundering and terrorist financing to identify and know customers and their activities. Further information on Íslandsbanki's money laundering protection.

Compliance

Íslandsbanki's Compliance Officer is appointed by the CEO and has an independent position in the bank's organization chart. The Bank's Board of Directors confirms the appointment of the Compliance Officer, and the Compliance Officer obtains His/her mandate from the Board. Íslandsbanki is required to show compliance, on the one hand as a financial undertaking authorised to trade in securities and on the other hand as an issuer of listed financial instruments.

The role of compliance is to regularly monitor and evaluate the suitability and effectiveness of Íslandsbanki's measures, which aim to ensure that the Bank, the Board and employees operate in accordance with applicable laws, regulations, the Bank's internal rules regarding securities transactions and money laundering protection, and that healthy business practices are followed. The Bank's Board of Directors is authorised to entrust the Officer with a different role to the one described above, in accordance with statutory obligations. The Compliance Officer submits an annual report to the CEO and the Board.