A good quarter at Icebank:
Profit up by 280% from last year
Reykjavík, 15 May 2007
Icebank hf. reported a profit of ISK 1,798 million for the first quarter of
2007, as compared to the IFRS-adjusted profit of ISK 473 million for the same
period in 2006, an increase of 280%. The profit for the first quarter of 2007
corresponds to earnings per share of ISK 2.4, compared to ISK 0.8 for the same
period in 2006. Annualised return on equity for the quarter was 55.7%, compared
to 31.7% for Q1 2006, which is among the highest for any financial institution,
Icelandic or foreign. The impairment on loans and advances amounted to only ISK
14 million, which demonstrates clearly the high quality of the Bank's loan
portfolio.
This is the first time Icebank has published quarterly statements. Publication
of the statements, which have been prepared in accordance with International
Financial Reporting Standards (IFRS), is part of its preparations for a listing
on OMX Nordic Exchange Iceland.
Net interest income amounted to ISK 507 million, compared to ISK 241 million
for the same period in 2006. This is an increase of 110%. This same item
aomunted to ISK 1,254 million for the whole of 2006. The total interest-rate
margin was 2.1% in the first quarter of 2007, compared to 1.8% for the whole of
2006. The growth in net interest income and the total interest-rate margin are
in line with the year's budget and are a clear sign of the continued
strengthening of the Bank's lending activities.
The item Other net operating income amounted to ISK 1,891 million, compared to
ISK 483 million for Q1 2006. This is an increase of 291%, and is due mostly to
the net gain on the Bank's shareholding in Exista. The Bank sold one quarter of
its shareholding (94 million shares) towards the end of the quarter, realising
gains of just over ISK 500 million. It also reports unrealised gains on its
remaining shareholding in Exista.
Salaries, payroll-related expenses and other operating expenses amounted to ISK
250 million for the quarter, compared to ISK 167 million for the Q1 2006. This
50% increase is in line with the Bank's budget and is explained by an increase
in the number of staff, increased IT costs and general growth in operations.
Total assets came to ISK 116 billion at the end of Q1 2007, compared to ISK 87
billion at the end of 2006, representing an increase of 33%. The largest share
of this growth comes from repurchase agreements with credit institutions. Loans
to customers other than financial institutions grew by ISK 2.3 billion and
amounted to ISK 33.9 billion at the end of the quarter.
The Bank's capital adequacy ratio (CAD) was 19.2% at the end of Q1 2007,
compared to 17.0% at the end of 2006. This change represents the outcome of two
contrary forces: on the one hand, balance sheet growth reduced the ratio, while
profit for the period and the sale of shares in Exista raised it. Total equity
amounted to ISK 13.8 billion at the end of the first quarter, compared to ISK
12.0 billion at the end of 2006. In March 2007 the Bank made a scrip issue to
current shareholders, raising share capital in the Bank from ISK 691 million to
ISK 1,141 million. The item Retained earnings was reduced by a corresponding
amount.
Finnur Sveinbjörnsson, CEO:
"This past quarter was a very good one. The Bank showed good profitability, the
staff are optimistic and keen to press ahead and the implementation of our new
strategic vision is moving along nicely. The Bank's financial position is
stronger than ever before and there is room for growth. The Bank recently
signed its largest ever syndicated loan agreement in the amount of EUR 217.5
million with a total of 34 European banks. Last month it was decided to move
the Bank's headquarters in January 2009 into a posh new office and residential
complex that is currently being built in the heart of Reykjavík's financial
district. All of us at Icebank are full of confidence about the future."
The financial statements can be found on the Bank's webpage: www.icebank.is or
the webpage of OMX Nordic Exchange Iceland: www.omx.is.
For further information please contact:
Finnur Sveinbjörnsson , CEO, finnur@icebank.is, tel. +354-540 4000.
Agnar Hansson, Managing Director, agnar@icebank.is, tel. +354-540 4000.
Hafdís Karlsdóttir, Managing Director, hafdis@icebank.is, tel +354-540 4000.
