Føroya Banki P/F - Ársreikningur

Interim report Q3 2009

Announcement 26/2009

Q3 highlights:
• Pre-tax profit up by 165% to DKK 58m compared to DKK 22m in Q3 2008
• Core earnings up by 13% to DKK 66m compared to 59m in Q3 2008
• Impairments DKK 20m compared to DKK 28m in Q3 2008
• The Group now offers mortgage bond housing finance through DLR
• Føroya Banki group received DKK 203m Hybrid Capital injection from the Danish
State 
• Acquisition of majority stake in Icelandic non-life insurance company Vörður
for DKK 48m 

Year to date highlights:
• Pre-tax profit guidance maintained at DKK 165-195m excl. value adjustments
and state guarantee 
• Net interest and fee income growth projection increased to 15-20%
• Interest and fee income and income from insurance activities up by 29% to DKK
371m 
• Core earnings has increased by 42% to DKK 186m from 130m in 2008
• Core cost/income ratio improved to 49% in 2009, compared to 55% in 2008
• The Group's solvency ratio is now 25% compared to 19% in Q3 2008
• Liquidity at the end of Q3 2009 was 234% above the statutory requirements

“We have maintained the steady progress in Q3, improving the bottom line and
the solid capital base, while at the same time realizing some major strategic
steps in terms of improving the product offering to our customers and
implementing our international growth strategy,” - Janus Petersen, CEO. 

The Group has continued to improve its results according to the forecast. In Q3
2009 Føroya Banki Group's pre-tax result was DKK 58m and the result year to
date 2009 was DKK 146m - in line with the projections, which are maintained. 

During Q3 2009 the Group took the first important step in its
internationalization strategy by acquiring the majority stake in the non-life
insurance company Vørður. Further the Group launched its first mortgage bond
product which over time can lift a large part of the bank's existing mortgage
loans off balance. Finally the Group received Hybrid Capital injection
amounting to DKK 203m from the Danish State. 

The main drivers behind the improved result are increased net interest income,
strong income from insurance activities, low and declining impairments compared
to peers, and continued below 50% core cost/income ratio. The positive
development in core earnings has made it possible to offset the increased
expenses to Danish state guarantee schemes. 

Based on the present solidity and the ability to generate income, the Group
will continue to develop its core competences and seek geographical expansion
within its present core business over the coming year. 

In connection with the publication of the Q3 2009 results Føroya Banki will
host a conference call for analysts and investors and publish a presentation on
the website. 

The conference call will take place on Thursday November 5th, at 13:00 (GMT),
14:00 (CET). If you would like to participate in the audio cast, please dial
the relevant number below a few minutes before the conference starts: 

UK participants dial: + 44 208 817 9301
Danish participants dial: + 45 327 147 67
US participants dial: + 1 718 354 1226
International Participants dial: + 44 (0) 208 817 9301

The presentation will be accessible on the website at www.foroya.fo.

Further informations:
Janus Petersen, CEO, tlf. +298 330 340
Johnny i Grótinum, Head of IR, Cell phone +298 230 380
www.foroya.fo

Attachments:

audiocast q3 2009.pdf

interim report q3 2009.pdf