- Landsbankinn’s profit in 2024 was ISK 37.5 billion after taxes, as compared with ISK 33.2 billion the previous year.
- Return on equity (ROE) in 2024 was 12.1%, compared with 11.6% in 2023.
- Profit in the fourth quarter of 2024 was ISK 10.6 billion and return on equity 13.3%.
- The Board of Directors intends to propose that the Annual General Meeting approve a dividend payment in the amount of nearly ISK 19 billion for the year 2024, corresponding to around 50% of the year’s profit.
- Total taxes paid by the Bank, both income tax and a special tax on financial undertakings, amounted to ISK 17.2 billion.
- Operating expenses increase in line with price levels yet the Bank’s cost-income ratio has never been lower, or 32.4%.
- Lending grew by ISK 177 billion during the year, or 10.8%. Customer deposits increased by ISK 180 billion, or 17,2%, at the same time.
- Increased activity and new services contributed to growing commission income, with net fee and commission income increasing by 2.3%.
- Net interest margin as a ratio of average asset position was 2.7% in 2024 compared to 3.0% for 2023. The net interest margin of domestic households was 2.1%.
- Use of Landsbankinn’s app continued to grow and surveys show that users are very satisfied with it. Customers who invest their under Smart Savings in the app grew by 39% in 2024, meaning that around 59,000 customers now gain the best interest terms offered on a non-indexed account.
- Net credit impairment of financial assets was negative by ISK 2.8 billion, with ISK 2.7 billion thereof attributable to natural disaster on the Reykjanes peninsula.
- The capital ratio at year end was 24.3%. The Financial Supervisory Authority (FSA) of the Central Bank of Iceland sets Landsbankinn’s total capital requirement at 20.4%.
- Today, the Bank publishes detailed sustainability information, including calculation of the carbon footprint of its credit portfolio, which has decreased by 20% from the reference year, 2019.
- In 2024, 57.7% of the Bank’s new funding was green and a total of 61.3% of non-domestic funding is green.
- In September, the FSA published the results of its assessment, finding that Landsbankinn is eligible to control a qualifying holding in TM tryggingar hf. (TM). The conclusion of the Icelandic Competition Authority in the same case is pending.
- The Pillar III risk report for 2024 is published alongside the annual financial statements.
- Landsbankinn’s Annual & Sustainability Report will be published 13 February 2025.
Lilja Björk Einarsdóttir, CEO of Landsbankinn:
“Landsbankinn achieved all of its main objectives in 2024, whether related to customer service, financial performance or operations. Profit amounted to ISK 10.6 billion in the fourth quarter and ISK 37.5 billion for the full year. Annualised return on equity was 12.1%. The fourth quarter was one of the strongest in the Bank’s history.
The Bank’s strong performance is built on solid foundations. Over the past ten years, the Bank’s total assets have grown by ISK 1,083 billion and equity by ISK 74 billion, alongside total dividend payments to shareholders amounting to ISK 192 billion. Operating expenses have remained stable, the number of full-time positions has decreased in tandem with technological advancements and the ratio of operating expenses to average total assets – a common measure of bank efficiency – has never been lower. As a result, the Bank’s competitiveness and strength have increased, enabling it to better support value creation and investments. The net interest margin has declined between periods, and the Bank is positioned to offer more favourable terms while still maintaining acceptable profitability.
The Bank’s strong financial position benefits society by increasing lending capacity. Total loan growth for the year amounted to ISK 177 billion, with around 60% of this increase from corporate lending. Landsbankinn remains the largest lender to the construction industry and has maintained a strong position in lending to fisheries, despite intense competition from foreign financial institutions, which can offer better terms due to greater economies of scale and lower taxes. Our focus on improving services for small and medium-sized enterprises has yielded strong results and we see many opportunities in this market. Demand for the Bank’s mortgage loans exceeded expectations, clearly indicating that borrowers are seeking competitive terms, fast service, and high-quality customer support. When the fixed interest rate period ended for customers who had fixed rates when they were at their lowest, we personally called each one to offer advice and go over the available options.
The increase in lending is backed by strong financing, not least growing customer deposits, which increased by ISK 180 billion over the year. Competitive rates and first-rate digital services have played a key role in this development. Throughout the year, the number of customers using the Bank’s Smart Savings in the app grew by 39%, allowing them to benefit from the best available rates on unrestricted accounts. Currently, around 59,000 individuals use this simple and favourable savings solution. Funding on both international and domestic capital markets was also successful. A noteworthy milestone was the issuance of senior non-preferred bonds, the first-ever issuance of its kind by an Icelandic bank. The success of bond issuances confirms the Bank’s strong financial position, which was also reflected in an upgrade in its credit rating. We believe that all conditions are in place for further improvements in the credit rating over the coming 1-2 years.
The Bank’s net interest margin declined during the year, reflecting the lower interest rate environment and there was a slight decrease in net interest income. Fee and commission income grew, particularly due to strong performance in acquiring services, where the Bank has firmly established its position. In 2024, 757 new businesses joined our acquiring services, including several of the country’s largest retail companies. The payment acquiring service has expanded the Bank’s service offering, boosted customer satisfaction, and created new growth opportunities in the corporate market: Nearly 40% of businesses that joined the service had no prior banking relationship with us.
Similarly, the Bank’s acquisition of TM presents significant growth opportunities, both on the corporate and retail side. We believe that the integration of banking and insurance services will be beneficial for customers, cost-efficient and full of potential, as evidenced by the success of similar models across Europe. At the same time, the acquisition will diversify revenue streams and support long-term profitability. The Bank’s strategic focus in recent years, providing outstanding service across Iceland both on-site and through leading digital solutions, including a top-tier app, creates exciting opportunities for both the Bank and TM.
One of the most significant events on the Icelandic market last year was JBT’s acquisition of Marel. Landsbankinn has long held an indirect ownership stake in Marel through Eyrir Invest, dating back to Eyrir’s refinancing in 2009. The value of this stake in Eyrir has fluctuated significantly over the years, at times impacting the Bank’s financial results considerably. Overall, the Bank’s involvement with Marel and Eyrir has been successful.
The vast majority of our customers use Landsbankinn’s app for their banking needs. The app is intuitive, offering unique features not available elsewhere and user satisfaction surveys indicate high approval. We are committed to continuous improvement, having released 33 app updates last year. Alongside our focus on development of the app and other digital innovation, we remain dedicated to the human element in customer service. We operate 35 branches and outlets across Iceland and this year we placed even greater emphasis on enabling employees all over the country to work on tasks that are not limited to geographic location. The results have been undeniably positive, reflected in shorter processing and wait times, as well as higher employee satisfaction, with staff appreciating the diverse and challenging work opportunities. Landsbankinn is a trusted bank for a successful future and its performance in recent years proves that with a dedicated and ambitious team, anything is possible.”
Landsbankinn’s financial calendar
- Annual General Meeting 19 March 2025
- Q1 2025 results 30 April 2025
- Q2 2025 results 17 July 2025
- Q3 2025 results 23 October 2025
- Annual results 2025 29 January 2026
For further information contact:
Public Relations, [email protected]
Investor Relations, [email protected]
Attachments
- Landsbankinn_results_presentation_ 31.12.2024
- Landsbankinn_consolidated_financial_statements_31.12.2024
- Landsbankinn_news_release_31.12.2024
