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2014-04-30 18:12:22 CEST 2014-04-30 18:12:52 CEST REGULATED INFORMATION Íslandsbanki hf. - Company AnnouncementIslandsbanki hf. : Íslandsbanki assigned BB+/B ratings with stable outlook from S&P+------------------------------------------------------------------------------+ |Íslandsbanki is well positioned in the Icelandic financial market with strong | |market share of 30-40% in most business lines despite being the smallest of | |its three domestic peers by assets, according to a rating assigned to | |Íslandsbanki by Standard & Poor's today. | | | |S&P rates Íslandsbanki as BB+/B with stable outlook. This is a satisfactory | |result, especially in light of the fact that it is only one notch below the | |rating assigned to the Icelandic Sovereign. | | | |In their research update, S&P note that two-thirds of the Bank's revenues come| |from net interest income, and has diverse revenues from the Bank's business | |segments. They also note that the strategic acquisitions in 2011-12 have | |improved the Bank and support their view of the Bank's management and | |strategy. | | | |In their view, Íslandsbanki is diligently preparing its balance sheet for the | |eventual relaxation of capital controls by building an exceptional funding and| |liquidity buffer, and note that the Bank's leverage ratio is exceptional in a | |global comparison. | | | |S&P also note that the Bank continues to reduce its non-performing loans and | |maintain ambitious goals in the next few years. At year-end 2013, the | |Icelandic loan portfolio analysis ratio (LPA) of loans under restructuring was| |8.3%, compared to an average of 12.5% for Iceland's top three banks at YE13. | | | |Birna Einarsdóttir, CEO of Íslandsbanki: | | | |We are pleased with the rating outcome, especially as it is only one notch | |below the rating assigned to the Icelandic Sovereign. It seems unlikely that | |credit ratings for Icelandic banks will improve until we see a positive rating| |action for the Icelandic Sovereign. This is an important objective that all | |relevant stakeholders must address together. | | | |The assigned rating from S&P recognises that the strategic direction we have | |followed in the last few years has been fruitful. Today, Íslandsbanki is well | |funded and a credit rating will further ease market access to international | |capital markets and allow is to better serve our customers who are engaged in | |international trade and need foreign currency funding. That is the way we best| |fulfil one of the key role for the Bank. Namely, to channel funds for | |investment and support the continued growth of the Icelandic economy. | | | |For further information: | | | | * Investor Relations - Tinna Molphy, tinna.molphy@islandsbanki.is and tel: | | +354 440 3187. | | * Media Relations - Dögg Hjaltalín, dogg.hjaltalin@islandsbanki.is and tel: | | +354 440 3925. | | | | | +------------------------------------------------------------------------------+ [HUG#1781822] |
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