Announcement 14/2009
Føroya Banki is well capitalised with a high solvency ratio and a solid excess
capital relative to the regulatory requirements. The Bank's core capital ratio
was 21.0 per cent as of 31. March 2009.
In recent years the Bank has experienced a balanced and controlled development
reflected in a loan portfolio characterised by high credit quality and good
diversification on segments, industries and single exposures.
The Board of Directors prioritises that the Bank holds a solid capital base to
resist any future effects of the ongoing financial crisis and the ensuing
international economic set-back. This is deemed to be the case with the current
capital base.
The Board of Directors is also focused on, that the Bank has the necessary
capital base to fulfil its strategic goals and continuous business
developments, whereof a participation in the current consolidation in the
Danish banking sector is seen as a vital element. In this expected and
necessary consolidation process Føroya Banki has a natural role to play having
the 9th largest market capitalisation of the banks listed on the Nasdaq OMX
Copenhagen stock exchange.
On this background, the Board of Directors has decided to apply for hybrid core
capital from the Credit Package with reference to the governmental stipulation
on capital injection in credit institutions.
The Bank applies for the maximal possible loan amount equivalent to 3 per cent
of the risk weighted assets. In terms of the Bank's interim report for Q1 2009
this corresponds to DKK 212 million. In case of the Bank's application for
hybrid core capital is approved, the core capital ratio of the Bank will be
increased from 21 to 24 per cent.
Further information:
Janus Petersen, CEO, Telephone (+298) 330 340
www.foroya.fo
