Islandsbanki hf.: Positive profit warning for the fourth quarter 2021
The preliminary financial results for 4Q21 indicate a net profit of approximately ISK 7.1bn, with an annualised return on equity of around 14.2%, compared with the average analyst consensus of ISK 5.0bn in net profit and 9.9% return on equity (see here). The results are therefore considerably above the Bank´s ROE target and analyst consensus. The Bank’s net profit after tax for 4Q20 was ISK 3.5bn with a 7.6% annualised return on equity.
According to the preliminary numbers, total operating income for 4Q21 was approximately ISK 13.1bn, an 8.8% increase from 4Q20. Thereof, net interest income was ISK 8.6bn, net fee and commission income ISK 3.7bn and net financial income ISK 0.7bn. Total operating expenses for the quarter were approximately ISK 6.3bn compared to ISK 6.6bn in 4Q20.
The deviation from the analyst consensus, for the quarter, is mainly explained by ISK 1.1bn profit from discontinued operations and ISK 0.6bn of positive net impairment of financial assets, mostly due to a more favourable outlook for loan exposures in the tourism sector. For comparison the net impairment charge of approximately ISK 1.8bn in 4Q20 was mainly due to the uncertainty related to the COVID-19 pandemic at that time.
The fourth quarter 2021 financial results and related investor material are still being finalised and the aforementioned numbers are therefore subject to change. The 4Q21 financial results will be published on 10 February 2022.
For further information:
Investor Relations – Margrét Lilja Hrafnkelsdóttir, ir@islandsbanki.is and tel: +354 844 4033.
Public Relations – Björn Berg Gunnarsson, pr@islandsbanki.is and tel: +354 844 4869.
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About Íslandsbanki
With a history that dates from 1875, Íslandsbanki is an Icelandic universal bank with a strong customer focus. The Bank believes in moving Iceland forward by empowering its customers to succeed – reflecting a commitment to run a solid business that is a force for good in society. Driven by the ambition to be #1 for service, Íslandsbanki’s banking model is led by three business divisions that build and manage relationships with its customers. Íslandsbanki maintains a strong market share with the most efficient branch network in the country, supporting at the same time its customers’ move to more digital services. The Bank operates in a highly attractive market and, with its technically strong foundations and robust balance sheet, is well positioned for the opportunities that lie ahead. Íslandsbanki has a BBB/A-2 rating from S&P Global Ratings. The Bank’s shares are listed on Nasdaq Iceland Main Market.
Disclaimer
This press release may contain “forward-looking statements,” involving uncertainty and risks that could cause actual results to differ materially from results expressed or implied by the statements. Íslandsbanki hf. undertakes no obligation and does not intend to update these forward-looking statements to reflect events or circumstances occurring after this press release. It is the investor’s responsibility to not place undue reliance on these forward-looking statements which only reflect the date of this press release. Forward-looking statements should not be considered as guarantees or predictions of future events and all forward-looking statements are qualified in their entirety by this cautionary statement.
