SOURCE: Islandsbanki hf

October 25, 2005 10:00 ET

Islandsbanki Nine Months Results 2005

ISK 15,358 Million in Profit After Tax

34% Return on Equity

REYKJAVIK, ICELAND -- (MARKET WIRE) -- October 25, 2005 -- The highlights of the financial statements of Islandsbanki hf. for the 9 months of 2005 are as follows:

--  Islandsbanki had a record profit for the first 9 months. After-tax
    profit for the third quarter was ISK 4,801 million compared with ISK 3,653
    million in the third quarter of 2004. After-tax profit for the first nine
    months of 2005 was ISK 15,358 million compared to ISK 11,010 million in
    2004, increased by 40%. Comparison figures for 2004 have been restated in
    accordance with International Financial Reporting Standards.
--  Pre-tax profit was ISK 18,151 million for the first 9 months of 2005
    compared to ISK 13,112 million 2004.
--  First 9 months' EPS was 1.20 compared to 1.10 for the same period
    2004. EPS in Q3 was ISK 0.37.
--  First 9 months' after-tax ROE was 34%, compared with 61% for the same
    period 2004. EVA for the period was ISK 9,370 million similar as for the
    same period in 2004.
--  Net interest income increased by 90% to ISK 16,764 million. Net
    interest income for Q3 was ISK 6,713 million, compared to ISK 2,945 million
    in Q3 2004.
--  First 9 months' cost-income ratio was 36.1% and 35.9% in the third
    quarter.
--  Net interest margin was 2.1% in the first nine months of 2005, a
    decrease from 2.4% for the same period in 2004. In part this is explained
    by BNbank in the consolidated figures. BNbank is also making a
    transformational increase in balance sheet figures.
--  Total assets amounted to ISK 1,319 billion at the end of the quarter,
    up by ISK 641 billion or 95% from 31 December 2004.
--  Total lending grew by 105% in the first nine months and was ISK 1,063
    billion at the end of September.
--  Loans to other than credit institutions grew by ISK 53 billion or
    about 5%, adjusted for the strengthening of the ISK and transfers of loans
    to financial assets designated at fair value through P&L.
--  Deposit growth was 102% in the first nine months up to ISK 360
    billion.
--  Assets under management grew by 4% in Q3, and 21% in the first 9
    months bringing to ISK 311 billion.
--  Book equity was ISK 76 billion at the end of Q3. The CAD ratio was
    12.3% and Tier 1 ratio was 9.4%.
--  The Board of directors has revised financial targets for the group
    aiming to stronger growth aligned with solid financial fundamentals.
    
Bjarni Armannsson, CEO:

"All units are showing good performance in line with our expectations. It is particularly satisfying to note the turnaround in the Commercial Banking division in Iceland and the increase in the number of international advisory and lending projects. The period was also characterised by internal development within the Bank in numerous areas and we are already seeing positive results. Overall the results and achievements are good in the 3rd quarter. I believe that we are on a growth track and all set for continued execution of our strategy."

The accounts of the Bank are available on its website: www.isb.is.

The press release including tables can be downloaded from the following link: http://hugin.info/135333/R/1017667/159516.pdf

The Consolidated Interim Financial Statements 1 January - 30 September 2005 can be downloaded from the following link: http://hugin.info/135333/R/1017666/159515.pdf

Contact Information

  • For further information please contact:
    Bjarni Armannsson
    CEO
    Tel: +354 440 4005

    Tomas Kristjansson
    CFO
    Tel: +354 440 4656

    Information for Investors:
    Vala Palsdottir
    Investor Relations
    Tel: +354 440 4989 / +354 844 4989
    E-mail: vala.palsdottir@isb.is