Lánamál ríkisins - Company Announcement

Government accounts 2014

The results of Government Accounts for 2014 have now been published and the
accounts forwarded to the Althingi. The current balance for the year was
positive by ISK 46.4 billion, which is a better than expected result. By
comparison, the 2013 outcome was a small deficit. 

Revenues in 2014 were substantially in excess of the Budget, with the major
factors here irregular items such as high dividend payments, for instance, from
Landsbanki Íslands hf., in addition to the effects of higher economic activity
in general. Expenditures exceeded Budget allocations somewhat, as additional
allocations were approved in the Supplementary Budget, which provided among
other things for part of the increased revenues to be used to accelerate
write-downs of inflation-indexed housing mortgages, thereby lessening the
subsequent expenditures. The primary balance was positive by the equivalent of
5.3% of GDP, compared to a positive primary balance of 3.0% in 2013. 

The Treasury had a net funding surplus equivalent to 4% of GDP, compared to
funding requirements of 1.6% the previous year. The outcome was more favourable
than expected, as the Budget estimated funding requirements of around 0.9% of
GDP, and the Supplementary Budget a funding surplus of around 2%. 

Iceland's economic situation improves

“Iceland's economic situation, which has been improving recently, is
characterised by stability with low inflation, low unemployment, increased
purchasing power and fiscal balance. GDP growth has been fairly substantial inrecent years, amounting to 1.9% in 2014. Despite high economic activity the
country's current account balance has remained positive. Strong growth and
increased demand in the economy have had a positive impact on Treasury
performance,” says Minister of Finance and Economic Affairs Bjarni Benediktsson
on the outcome of government accounts. He points out that major emphasis has
been placed on regaining fiscal balance and turning the deficits of previous
years into a surplus. “The govern­ment has made fiscal consolidation its chief
priority, together with reducing the tax burden on households and corporates,
and encouraging additional investment in the economy. It is very important to
further reinforce the Treasury's position in coming years and lower government
debt relative to GDP," the Minister concluded. 

Electronically endorsed accounts

For the second year in a row, the Minister of Finance and Economic Affairs, the
Director General of the Financial Management Authority and the Auditor General
all endorsed the Government Accounts with electronic signatures, using digital
certificates. Iceland is among the first countries to endorse its Government
Accounts in this manner. 

The Government Accounts in their entirety, with the accompanying breakdown and
notes, are accessible on the website of the Financial Management Agency,
fjs.is.

Attachments:

Rikisreikningur 2014 Heildaryfirlit.pdf

Rikisreikningur 2014 Arsreikningar rikisaila.pdf

Government accounts2014_PressRelease.pdf