Landsbankinn hf. has today, 19 June 2015, signed an agreement with savings bank Sparisjóður Norðurlands ses. to begin the process of merging the two companies. On 9 June 2015, the Board of Directors of the savings bank approached Landsbankinn to gauge interest in a merger due to uncertainties regarding the savings bank's future. Negotiations have been under way since then.
A merger schedule is subject to a legal process which takes four weeks at a minimum, commencing with a formal advertisement. The merger is subject to approval by the Financial Supervisory Authority, Iceland (FME), and the Icelandic Competition Authority.
A merged company would operate under Landsbankinn's name. All assets and obligations of the savings bank would be consolidated with those of Landsbankinn and Landsbankinn would take over operation of all of the savings bank's service points.
According to the agreement currently in place, guarantee capital holders in the savings bank would be compensated with shares in Landsbankinn. Such remuneration would amount to a total of ISK 594 million, subject to the outcome of due diligence.
Steinthór Pálsson, CEO of Landsbankinn: "The Board of Directors of Sparisjóður Norðurlands ses. has sought to merge the company with Landsbankinn as the savings bank has not met regulatory requirements for a minimum capital adequacy ratio. Once the relevant supervisory authorities have given their approval, we expect the merger to proceed smoothly and for Landsbankinn to provide reliable service to the market previously served by Sparisjóður Norðurlands."
For further information contact:
Kristján Kristjánsson, pr@landsbankinn.is, +354 410 4011/+354 899 9352