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Islandsbanki hf.: Preliminary financial results for the third quarter 2021 show a net profit of ISK 7.6bn with annualised return on equity of 15.7% - considerably above the Bank´s financial targets and analyst consensus

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The preliminary financial results for 3Q21 indicate a net profit of approximately ISK 7.6bn, with annualised return on equity of around 15.7%, compared with average analyst consensus of ISK 4.6bn net profit (see here).
The Bank’s net profit for 3Q20 was ISK 3.4bn with 7.4% annualised return on equity.

Total operating income for 3Q21 was approximately ISK 13.3bn, a 20.6% increase from 3Q20.
Thereof, net interest income was ISK 8.8bn, net fee and commission income was ISK 3.4bn and net financial income ISK 0.9bn.
The positive impact from net financial income is mainly explained by a positive value change in unlisted equity instruments.
Operating expenses for the quarter were approximately ISK 5.7bn compared to ISK 5.6bn in 3Q20.

The deviation between years and from the Bank’s financial targets is mainly explained by an ISK 1.8bn positive net impairment of financial assets in 3Q21 mostly due to a brighter outlook for the tourism industry and reduced impairments on loans to individuals resulting from an updated risk assessment model.
For comparison the net impairment charge of approximately ISK 1.1bn in 3Q20 was mainly due to the uncertainty related to the COVID-19 pandemic at that time.

The third quarter 2021 financial results and investor presentation are still being finalised and the aforementioned numbers are therefore subject to change. The financial results will be published on 28 October 2021.

For further information:
Investor Relations – Margrét Lilja Hrafnkelsdóttir, and tel: +354 844 4033.
Public Relations – Björn Berg Gunnarsson, and tel: +354 844 4869.

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About Íslandsbanki
With a history that dates from 1875, Íslandsbanki is an Icelandic universal bank with a strong customer focus. The Bank believes in moving Iceland forward by empowering its customers to succeed - reflecting a commitment to run a solid business that is a force for good in society. Driven by the ambition to be #1 for service, Íslandsbanki’s banking model is led by three business divisions that build and manage relationships with its customers. Íslandsbanki maintains a strong market share with the most efficient branch network in the country, supporting at the same time its customers’ move to more digital services. The Bank operates in a highly attractive market and, with its technically strong foundations and robust balance sheet, is well positioned for the opportunities that lie ahead. Íslandsbanki has a BBB/A-2 rating from S&P Global Ratings. The Bank’s shares are listed on Nasdaq Iceland Main Market.

This press release may contain “forward-looking statements,” involving uncertainty and risks that could cause actual results to differ materially from results expressed or implied by the statements. Íslandsbanki hf. undertakes no obligation and does not intend to update these forward-looking statements to reflect events or circumstances occurring after this press release. It is the investor's responsibility to not place undue reliance on these forward-looking statements which only reflect the date of this press release. Forward-looking statements should not be considered as guarantees or predictions of future events and all forward-looking statements are qualified in their entirety by this cautionary statement.

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