Landsbankinn reports an ISK 8.3 bn profit in Q1

June 1, 2010 15:29

In Q1 of 2010, Landsbankinn's net after-tax profit was ISK 8.3 bn. After-tax profit for the whole of 2009 was ISK 14.3 bn. In 2009, ROE was 10%, reports with reference to Landsbankinn. 

Landsbankinn's capital adequacy ratio is now 16.3%, higher than the 16% mandatory minimum requirement of the Financial Supervisory Authority.

Key figures from the profit and loss account and balance sheet:
Net after-tax profit amounted to ISK 8.3 bn
ROE was 21
Interest rate differential on average balance of total assets was 2.5%
Current equity amounts to ISK 166 bn
Capital adequacy ratio (CAD rules) was 16.3% compared to 15% at year-end 2009
Landsbankinn's total assets amounted to ISK 1,113 bn as of the end of March 2010
The ratio of customer deposits to lending is now 67% compared to 68% at year-end 2009
Operating expenses from regular activities were ISK 4.0 billion

An unusual year all around, 2009 was Landsbankinn's first full year of operations. While the first half of the year was unfavourable for the bank, results improved considerably during the latter half and the results of Q1 2010 represent a continuation of those developments. The bank's performance has been acceptable. It should be noted that exchange rate developments have been positive for the bank during the period and are an important factor in its results.

The bank's performance in 2008 (7 October to 31 December) was negative by ISK 6.9 bn and 2009 results were dissatisfactory in that they were somewhat lower than the financial expenses incurred by the Icelandic state in connection with its capital contribution to the bank.

During the year to date, Landsbankinn has continued to put considerable effort into developing measures to assist individuals, households and corporations experiencing financial difficulties. Most recently, the bank offered a solution whereby the principal of loans to individuals and companies, denominated in foreign currency, is lowered by 25%. In so doing, the bank has extended itself to meet demands for debt forgiveness.

With 36 branches and operational locations nationwide, Landsbankinn is the largest financial institution in Iceland. The Icelandic state owns an 81% stake in Landsbankinn (NBI hf.) and the Resolution Committee of old Landsbanki Islands owns 19%. The bank has just over 1100 employees.

The main subsidiaries of Landsbankinn are leasing company SP Fjarmoegnun; UCITS and investment fund management company Landsvaki; asset management companies Reginn and Vestia; Horn, which administers the bank's shareholdings in other companies; and Hömlur, custodian of the bank's smaller assets held for sale.

Since the collapse, extensive efforts have been put into reorganising the bank's entire structure, its procedures and working practices. Steinthor Palsson assumes the position of CEO of Landsbankinn on 1 June as Asmundur Stefansson steps down.

Asmundur Stefansson, CEO:

"I am leaving after 15 months as CEO of Landsbankinn. While this has been a period of unprecedented difficulty in the bank's history, the united efforts of its very capable employees have succeeded in bringing operations back on track. The bank is now in a position to assume its intended role as Iceland's largest financial institution and thus leading in the economy's recovery. It is gratifying to be able to hand over a solid concern.

I would like to take this opportunity to thank Landsbankinn's Board of Directors, my colleagues and the bank's customers for positive co-operation during my time here. I wish the bank and my successor every future success.

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