Kvika banki hf.: Consolidated Financial Statements 2025

Core Viewpoint - The year 2025 was marked by strong operational performance for Kvika banki hf., highlighted by significant growth in net interest income and strategic initiatives, despite a decrease in post-tax profit from continuing operations compared to 2024 [10][11]. Financial Performance - Profit before tax from continuing operations increased to ISK 6,217 million in 2025, up by ISK 400 million or 6.9% from ISK 5,817 million in 2024 [6]. - Post-tax profit from continuing operations decreased to ISK 4,363 million in 2025, down by ISK 327 million or 7.0% from ISK 4,690 million in 2024 [6]. - Net interest income rose to ISK 11,896 million in 2025, an increase of ISK 2,215 million or 22.9% from ISK 9,681 million in 2024 [6]. - Net fee and commission income increased to ISK 6,291 million in 2025, up by ISK 155 million or 2.5% from ISK 6,137 million in 2024 [6]. - Administrative expenses rose to ISK 12,074 million in 2025, an increase of ISK 1,466 million or 13.8% from ISK 10,608 million in 2024 [6]. Balance Sheet Highlights - Customer deposits increased to ISK 173 billion at year-end 2025, up by 5.8% from ISK 163 billion at year-end 2024 [7]. - Loans to customers surged to ISK 208 billion at year-end 2025, a significant increase of 38.2% from ISK 150 billion at year-end 2024 [7]. - Total assets decreased to ISK 343 billion at year-end 2025, down from ISK 355 billion at year-end 2024 [7]. - Total equity decreased to ISK 69 billion at year-end 2025, down from ISK 90 billion at year-end 2024 [7]. - The capital adequacy ratio improved to 26.8% at year-end 2025, compared to 22.8% at year-end 2024 [7]. - The total liquidity coverage ratio was 404% at year-end 2025, up from 360% at year-end 2024 [7]. Dividend and Shareholder Returns - The Board of Directors proposed a dividend of 0.36 ISK per share for a total of ISK 1,566 million, representing 25% of profit after tax for 2025 [8]. - Kvika returned ISK 27 billion to shareholders in the form of dividends and share buybacks following the sale of TM Insurance, marking the largest capital return in its history [12]. - The company has the capacity to return up to ISK 15 billion to shareholders in 2026 through dividends or buybacks without compromising growth ambitions [12]. Strategic Initiatives - The bank launched a new mortgage product under the Auður brand and celebrated its 10-year anniversary in its current form in 2025 [11]. - Kvika issued its inaugural euro-denominated bond and successfully led the offering of the government's remaining stake in Íslandsbanki [11]. - The merger process with Arion Bank is ongoing, with discussions with competition authorities progressing well [12].