Íslandsbanki’s Q1 2011 results

27.05.2011 - Financial Results

Íslandsbanki hf. presents its unaudited consolidated financial statements for the quarter ended 31 March 2011, which have been prepared on a going concern basis. The Bank turned a profit of ISK 3,586m for the period. Tax charges and National Insurance are estimated at ISK 1,098m. The Bank's total capital ratio of 27.4% exceeds the 16% minimum set by the Icelandic Financial Supervisory Authority (FME). Return on equity was 11.7% for the period.

  • Profit after tax was ISK 3,586m which is the same result as for Q1 2010.
  • Tax charges and National Insurance for the period amounted to ISK 1,098m. Thereof, income tax was ISK 865m, the bank tax was ISK 55m and the National Insurance charge was ISK 178m.
  • Net interest income was ISK 8,061m compared to ISK 9,149m in Q1 2010. The decrease is partly due to a decrease in interest on equity and a decrease in the deposit margin.
  • Net valuation changes on loans and receivables amounted to ISK 664m compared to 1,176m in Q1 2010.
  • Latent impairment was ISK 171m compared to ISK 561m in Q1 2010.
  • Net fee and commission income was ISK 1,715m compared to ISK 1,624m in Q1 2010.
  • Other financial expenses amounted to ISK 138m compared to ISK 385m in Q1 2010.
  • Net foreign exchange gain on the Bank's real foreign exchange gap was ISK 202m compared to a loss of ISK 127m in Q1 2010.
  • The Bank recognised a ISK 467m charge to the Investors' and Depositors' Guarantee Fund.
  • The core cost/income ratio was 52.9% compared to 40.4% in Q1 2010.
  • Total assets at 31 March 2011 were ISK 666bn compared to ISK 683bn at year-end 2010.
  • Return on equity for the period was 11.7% compared to 15.3% in Q1 2010.
  • The total capital ratio at the end of the period was 27.4% compared to 26.6% at year-end 2010. The Financial Supervisory Authority sets a minimum total capital ratio of 16%.
  • Loans to customers and credit institutions totalled ISK 529bn and total deposits amounted to ISK 410bn at the end of the period. Loans to customers and credit institutions were ISK 546bn at year-end 2010 and total deposits were ISK 423bn.
  • The deposit/loan ratio was 77.4% at the end of the year compared to 77.5% at year-end 2010.
  • Equity as at 31 March 2011 amounted to ISK 124bn compared to 121bn at year-end 2010.
  • The average number of full time equivalent employees (FTE) for the group was 1,139 at the end of the period compared to 1,018 in Q1 2010. The difference is mainly explained by a new subsidiary entering the group.

Birna Einarsdóttir, CEO of Íslandsbanki:

"The results for the first quarter of 2011 are in line with expectations. The largest project this year has been the restructuring of the retail and corporate loan portfolios. At the same time numerous other projects have been completed amongst others Glacier Securities LLC, the New York based subsidiary of Íslandsbanki, was granted a broker dealer license in the US, the wealth management division was successfully rebranded to VÍB and the annual strategy meeting was held with the participation of about 650 employees and 150 customers. The enormous task of building up a new Bank started two and a half years ago and I am pleased to see how much we have progressed during this period."

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