SOURCE: Landsbanki Íslands hf

February 28, 2008 12:42 ET

Moody's Downgrades Landsbanki's Credit Rating to A2/C-

REYKJAVÍK, ICELAND--(Marketwire - February 28, 2008) - Moody's Investors Service today downgraded the long-term foreign and local currency deposit ratings of Landsbanki Islands hf ("Landsbanki") to A2 from Aa3 and its bank financial strength rating ("BFSR") to C- from C. The bank's Prime-1 short-term rating was affirmed, which is the highest rating given. The outlook on all ratings is stable. These rating actions conclude the review for possible downgrade initiated on 30 January 2008.

This is the latest development in a series of Moody's rating actions in the past 12 months which have moved Landsbanki's rating from A2 up to Aaa, down to Aa3 and now again down to A2. In February 2007, Moody's introduced a new 'Joint Default Analysis' (JDA) methodology and upgraded a host of banks, including all the Icelandic banks to Aaa, the same rating as the Icelandic Sovereign. After receiving harsh criticism from the credit analyst community and market place, Moody's later modified its JDA methodology for the global banking sector, resulting in an Aa3 rating for Landsbanki in April 2007. On the back of today's rating action, Landsbanki has returned to its A2 rating.

For further information on the rating action, please refer to the attached press release from Moody's.

About Landsbanki

Landsbanki is a growing European bank with total assets of ISK 3,058 billion (EUR 33.4 bn) at year-end 2007 and a market capitalisation of ISK 301 billion (EUR 3.05 bn) as of 28 February 2008. Through its extensive distribution network of 2,640employees in 17 countries, Landsbanki is set to deliver targeted financial services based on local expertise for mid-cap corporates in Europe. Landsbanki provides retail and corporate banking, investment banking, capital markets services, asset management and wealth management for private banking clients. Landsbanki's unique product line includes access to both debt and equity markets and its research department is among the most comprehensive in Europe, including some 100 analysts covering close to 950 European stocks.

The market leader in the Icelandic financial service sector, Landsbanki's growth in recent years has been primarily organic, based upon smaller, strategically acquired platforms in the UK, Ireland and Continental Europe. Most recently, the bank acquired the securities broker and investment bank Bridgewell in the UK.

Headquartered in Reykjavik, Iceland, Landsbanki Islands hf. is traded on the OMX Nordic Exchange Iceland under the ticker LAIS. Landsbanki is rated by Moody's (A2 / P-1 / C- / Stable) and Fitch (A / F1 / B/C / Stable).

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Contact Information

  • For further information please contact:
    Landsbanki's CEOs
    Sigurjón Th. Árnason
    tel. +354 410-4009 / +354 898-0177

    Halldór J. Kristjánsson
    tel. +354 410 4015 / +354 820 6399

    Brynjólfur Helgason
    Alternate CEO and MD International Banking.

    Media Relations:
    Andrew Walton
    Financial Dynamics
    tel: +44 20 7269 7204 / mob: +44 7711 264 157.