Landsbankinn hf.: Merger of Landsbankinn and Sparisjóður Vestmannaeyja


  • The Financial Supervisory Authority, Iceland (FME), has decided on the merger of Landsbankinn and savings bank Sparisjóður Vestmannaeyja.
  • The merger became effective as of Sunday 29 March at 15:00.
  • As of that moment, all employees of the savings bank became employees of Landsbankinn.
  • Landsbankinn has taken over all assets and liabilities of the savings bank, including customer loans and deposits.
  • To begin with, Sparisjóður Vestmannaeyja will continue business as usual and all service outlets will open on Monday 30 March at regular hours.
  • Customers will continue to have access to online banking.
  • Landsbankinn is well positioned to overtake the savings bank's operations and liabilities.
  • Landsbankinn offers a warm welcome to the customers of the savings bank.

For some time now, Sparisjóður Vestmannaeyja has not fulfilled regulatory capital requirements and has been seeking means to resolve its financial difficulties. The Board of Directors of the savings bank contacted Landsbankinn once other restructuring attempts failed.

The Board of the savings bank and Landsbankinn reached an agreement on the merger of the two entities. On 29 March, the FME reached the decision to merge the companies based on Temporary Provision VI of Act No. 161/2002, on Financial Undertakings.

At the time of the merger, the initial capital of the savings bank is valued at ISK 332 million. The valuation is subject to possible changes yet cannot fall below ISK 50 million and never exceed ISK 550 million. As compensation for the savings bank's initial capital, the previous owners receive shares in Landsbankinn to the amount of just under 0.15% of issued share capital in the Bank, with the final amount depending on the value of the saving bank's initial capital.

Sparisjóður Vestmannaeyja operates outlets in five locations in Iceland: in Vestmannaeyjar, Selfoss, Höfn, Breiðdalsvík and Djúpivogur. Landsbankinn has branches in Selfoss and Höfn and the outlets in these two locations will be merged in the near future.

Emphasis will be placed on ensuring that the merger enhances service to customers and solidifies their relationship with the Bank. All outlets of the savings bank will open at regular hours on Monday and customers will be able to do business with their usual service representatives. Accounts and account numbers will initially remain unchanged.

 

Thorbjörg Inga Jónsdóttir, previous Chairman of the Board of Directors of Sparisjóður Vestmannaeyja:

"The Board of Directors of Sparisjóður Vestmannaeyja has recently sought means to strengthen its operating basis. The agreement with Landsbankinn is a positive solution which safeguards the interests of the savings bank, its owners and customers, as well as that of the communities where the bank operates. Due to the savings bank's position, it was unavoidable to seek collaboration with a strong partner for the future and we wish to thank Landsbankinn for the joint effort in these past few days."

 

Steinthór Pálsson, CEO of Landsbankinn:

"Sparisjóður Vestmannaeyja has been an important actor in the communities where it has operated. Landsbankinn will make every effort to welcome the savings bank's customers and provide them with the best possible service. Our emphasis in the wake of the merger will be to ensure speedy integration of operations to continue to offer robust financial service to these communities. I hereby welcome the customers of the savings bank to Landsbankinn.

 

For further information contact:

Kristján Kristjánsson, pr@landsbankinn.is, +354 410 4011/+354 899 9352