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Kvika banki hf.: Financial Results for Q3 2026

News Provided by GlobeNewswire2026-11-04

Return on tangible equity of 18.9% in the quarter, the Bank’s highest return in two years

At a board meeting on 4 November 2026, the Board of Directors and the CEO approved the condensed interim consolidated financial statements of Kvika banki hf. (“Kvika” or “the bank”) for the third quarter and first nine months of 2026.

Highlights of performance in the third quarter (Q3 2026):

Profit before tax from continuing operations amounts to ISK 1,754 million in Q3 2026, compared to ISK 1,969 million in Q3 2025, decreasing by ISK 215 million from previous year or 10.9%.
Post-tax profit from continuing operations amounts to ISK 1,342 million in Q3 2026, compared to ISK 1,472 million in Q3 2025, decreasing by ISK 130 million from previous year or 8.8%.
Net interest income amounts to ISK 3,052 million in Q3 2026, compared to ISK 2,953 million in Q3 2025, increasing by ISK 99 million from previous year or 3.4%.
Net interest margin was 4.0% in Q3 2026, compared to 4.0% in Q3 2025.
Net fee and commission income amounts to ISK 1,380 million in Q3 2026, compared to ISK 1,571 million in Q3 2025, decreasing by ISK 191 million from previous year or 12.2%.
Other net operating income amounts to ISK 366 million in Q3 2026, compared to ISK 338 million in Q3 2025, increasing by ISK 28 million from previous year.
Administrative expenses amount to ISK 2,807 million in Q3 2026, compared to ISK 2,740 million in Q3 2025, increasing by ISK 67 million from previous year or 2.4%.
Pre-tax return on tangible equity (RoTE) from continuing operations was 18.9% in Q3 2026, compared to 17.8% in Q3 2025.
Earnings per share from continuing operations amounted to ISK 0.31 in Q3 2026, compared to ISK 0.33 in Q3 2025.

Key balance sheet figures as at 30.09.2026:

Deposits from customers amount to ISK 200 billion, compared to ISK 173 billion at year-end 2025 and increased by 16.0% during the period.
Loans to customers amount to ISK 235 billion, compared to ISK 208 billion at year-end 2025 and increased by 13.2% during the period.
Total assets amount to ISK 370 billion, compared to ISK 343 billion at year-end 2025.
Total equity of the group amount to ISK 58 billion, compared to ISK 69 billion at year-end 2025.
The capital adequacy ratio (CAR) was 22.3%, compared to 26.8% at year-end 2025, as determined on the basis of the unaudited net earnings in the period. Kvika 's capital ratio as calculated under the Financial Undertakings Act No. 161/2002 was 21.8% at the end of September 2026.
Total liquidity coverage ratio (LCR) of the group was 174%, compared to 404% at year-end 2025.
Total assets under management amount to ISK 442 billion, compared to ISK 469 billion at year-end 2025.

Highlights of performance in the first nine months (9M 2026):

Profit before tax from continuing operations amounts to ISK 5,108 million, compared to ISK 4,695 million in 9M 2025, increasing by ISK 413 million from previous year or 8.8%.
Post-tax profit from continuing operations amounts to ISK 3,619 million, compared to ISK 3,097 million in 9M 2025, increasing by ISK 522 million or 16.9% from the previous year.
Net interest income amounted to ISK 9,331 million, compared to ISK 8,831 million in 9M 2025, an increase of 5.7% from the previous year.
Net interest margin was 4.2% in 9M 2026, compared to 4.1% in 9M 2025.
Net fee and commission income amounted to ISK 4,282 million, compared to ISK 5,026 million in 9M 2025, a decrease of 14.8%.
Other net operating income was ISK 828 million, compared to ISK 581 million in the same period in 2025, increasing by ISK 247 million
Administrative expenses were ISK 8,767 million, compared to ISK 8,811 million in the same period in 2025, decreasing by ISK 44 million from previous year or 0.5%.
Pre-tax return on tangible equity (RoTE) from continuing operations was 16.4% in 9M 2026, compared to 14.9% in 9M 2025
Earnings per share from continuing operations amounted to ISK 0.84 in 9M 2026, compared to ISK 0.68 in 9M 2025.

Ármann Þorvaldsson, CEO of Kvika:

“I am happy to see that the bank has reached the point where its operations are delivering returns in line with our targets. Return on tangible equity in the third quarter, 18.9%, was the highest since the third quarter of 2024 and follows substantial distributions to shareholders in the form of dividends and share buybacks. At the same time, we have seen strong growth in both lending and deposits, while costs have remained virtually unchanged year-on-year.
These results have been achieved despite a challenging external environment, persistent inflation, high interest rates and a significant decline in stock market turnover, which has had a considerable negative impact on the Bank’s fee income.
Substantial steps have recently been taken in the bank’s funding. Following a successful EUR issuance in the summer, unfavourable borrowings in the UK have been repaid, and this month an expensive bond series issued in the Nordics will be redeemed. Kvika also completed its inaugural covered bond issuance, which was very well received and now enables Auður to offer non-indexed fixed-rate mortgages for the first time.
We expect net interest income to continue to grow steadily, supported by improved funding terms and the continued expansion of our loan books in Iceland and the UK. We do not anticipate a corresponding increase in costs, which should support continued improvement in the bank’s profitability in the coming quarters.
However, a bill to increase the bank tax is currently before parliament, which would further add to the special levies already imposed on financial undertakings. Kvika has submitted proposals to the Economic Affairs and Trade Committee for amendments to the bill aimed at reducing the impact of the tax on smaller financial institutions, either by limiting its application to systemically important banks or by significantly raising the tax-free threshold.
We find it hard to believe that an increase in the tax, which when introduced was never intended to apply to any institutions other than systemically important banks and has been justified on the basis of the large banks’ temporary profits from high inflation, would be applied in the same way to a small bank that has not benefited at all from high inflation.
Kvika offers consumers savings deposits and mortgages through the Auður brand at minimal interest margins and therefore has limited room to absorb higher taxation without it affecting the terms offered to customers. Such taxation would also weaken the competitive pressure that Kvika exerts on the large banks and could therefore have a far broader negative impact on consumers than on Kvika’s customers alone.
During the quarter, the appointment of Jón Birgir Jónsson as the Bank’s new CEO was announced and he will take up the role in early December. I wish Jón every success in his new role, as I say goodbye with great fondness to a workplace that I will miss greatly.”

Presentation for shareholders and market participants

A presentation for shareholders and market participants is scheduled for Thursday, November 5, at 08:30, at Kvika’s headquarters, located on the 9th floor of Katrínartún 2. At the meeting, Ármann Þorvaldsson, CEO, and Eiríkur Magnús Jensson, CFO, will present the Group’s financial results. Halldór Snæland, Managing Director of Commercial Banking, will also give a brief overview of the segment and its key priorities. The presentation will be conducted in Icelandic, with a live stream available on the following website:

https://kvika.is/kynning-a-uppgjori-9m-2026/

Meeting participants will be able to send questions before or during the meeting via ir@kvika.is

Attached is the investor presentation. Additionally, a recording with English subtitles will be made available on Kvika’s website.

Attachments