Standard & Poor’s affirmed its rating on Íslandsbanki, BBB-/A-3 with stable outlook


Standard & Poor’s affirmed its rating on Íslandsbanki, BBB-/A-3 with stable outlook, after Íslandsbanki recently announced amendments to its original agreement with Glitnir Bank. As part of the changes, Glitnir will relinquish to the government of Iceland all of its shares in ISB Holding ehf., which owns 95% of shares in Íslandsbanki. With this proposed change, Íslandsbanki will no longer pay the extraordinary dividends to Glitnir as was originally planned in the original proposed agreement between Glitnir and the Icelandic Central Bank announced in June 2015.


In their research update S&P notes that although Íslandsbanki's will not pay dividends to Glitnir under the new agreement, they see the government's ownership as accommodating Glitnir's owners' desire to simplify the agreement and allow them to extract capital from Iceland by the end of the year.


S&P also note that they do not see Íslandsbanki as a strategic investment for the government and believe that the bank will be up for sale from the government of Iceland within two years. They believe that it is likely that capital levels will be reduced in preparation for an eventual sale and, as such, project the risk-adjusted capital (RAC) ratio at 12%-13% by the end of 2017, down from a pro forma midyear 2015 RAC ratio of 17.3%.


S&P stable outlook on Íslandsbanki reflects their assumption that Íslandsbanki will retain strong capital and liquidity buffers, even after expected deposit outflows owing to the relaxation of Iceland's capital controls over the coming months.



Older news

Íslandsbanki issues EUR 300m bond and announces partial buyback of its 2020 EUR 500m bond

04.04.2019 - IR Releases
Íslandsbanki has today issued a EUR 300m 1.125% fixed rate senior unsecured bond for 3 years, at a spread of 130 basis points over mid-swaps.More

Annual General Meeting 2019 - agenda, candidates and proposals

The Annual General Meeting of Íslandsbanki hf. will be held on March 21, 2019 at the Bank's headquarters, Hagasmári 3, 201 Kópavogur at 15:00.More

Publication of 2018 Annual Report and Pillar 3 Report

13.02.2019 - IR Releases
Íslandsbanki has published an Annual Report and Pillar 3 Report for 2018. More

Annual Results 2018

13.02.2019 - IR Releases
The Bank and Íslandssjóðir turned in a good operating performance during the year, with a consolidated profit of ISK 10.6bn, while operational...More

Publication of 2018 year-end results

30.01.2019 - IR Releases
Close of business Wednesday, 13 February 2019More

Íslandsbanki to terminate credit rating contract with Fitch Ratings

30.01.2019 - IR Releases
Íslandsbanki informs that following expiration and by agreement of parties, the credit rating service contract between Fitch Ratings and Íslandsbanki...More

Ásmundur Tryggvason to direct Corporate and Investment Banking

Ásmundur Tryggvason has been engaged as director of Corporate and Investment Banking at Íslandsbanki. He replaces Vilhelm Már Þorsteinsson, who will...More