Íslandsbanki publishes opening balance sheet
Íslandsbanki Press Release - Reykjavík 28.9.2009
Following the conclusion of agreements between Íslandsbanki, Glitnir's Resolution Committee on behalf of creditors, and the Icelandic state, Íslandsbanki has decided to publish its opening balance sheet, dated 15 October 2008.
- Bank's total assets ISK 629 billion
- Well diversified loan portfolio
- Indexation and FX imbalances manageable
Total assets ISK 629 billion
Íslandsbanki's assets, according to its newly published balance sheet, total ISK 629 billion.
The bank's principal assets consist of cash and cash equivalents amounting to ISK 53 billion, loans to customers totalling ISK 477 billion, and unpaid, subscribed share capital of ISK 64 billion. This amount has now been paid to the bank in full as the state's equity contribution.
The bank's loan portfolio is well diversified: 32% are loans to individuals and households, some 16% are to fisheries enterprises, 14% to real estate companies, 11% to investment companies and 27% to other borrowers.
| Íslandsbanki Opening Balance Sheet | |
| Dated 15 October 2008 | |
| Assets | ISK million |
| Cash | 53.829 |
| Loans to banks | 8.411 |
| Loans to customers | 477.069 |
| Bonds and debt instruments | 3.762 |
| Shares and equity instruments | 3.095 |
| Investments in subsidiaries and associates | 11.012 |
| Property and equipment | 1.475 |
| Non current assets | 504 |
| Unpaid share subscription | 64.225 |
| Other assets | 5.878 |
| Total assets | 629.260 |
| Liabilities | |
| Deposits from banks | 51.891 |
| Other deposits | 372.144 |
| Other liabilities | 83.464 |
| Guarantees granted to customers | 4.761 |
| Compensation instrument | 52.000 |
| Share capital | 65.000 |
| Total equity and liabilities | 629.260 |
Deposits of ISK 424 billion
Customer deposits comprise the lion's share of liabilities on the balance sheet, totalling ISK 424 billion, with ISK 372 billion deposits from enterprises, individuals and households and ISK 52 billion deposits from financial institutions. Other liabilities amount to ISK 83 billion. The amount of the compensation instrument issued in accordance with a settlement with Glitnir is ISK 52 billion.
Indexation and FX imbalances
Íslandsbanki has managed to convert a substantial portion of its non-indexed liabilities to indexed debt on acceptable terms. This has reduced the bank's indexation imbalance which is well manageable under the current situation.
The original transfer of assets and liabilities from Glitnir to Íslandsbanki resulted in a sizeable imbalance in the currency breakdown of the bank's assets, which are primarily loans, many of them foreign-denominated, and its liabilities, consisting mainly of deposits in ISK from domestic customers. Valuation of the bank's assets took into consideration the fact that a
A large portion of foreign denominated loans are to customers with income in ISK and they mostly handled as loans in ISK. In the bank's estimation, its current FX imbalance is quite manageable.
The bank's financial plan anticipates that its operations will return an acceptable profit.
Changes since the publication of the provisional balance sheet
The Icelandic Financial Supervisory Authority (FME) had previously published a provisional balance sheet for the bank on 14 November 2008. The bank's assets as listed there were considerably greater than in the newly released initial balance sheet due primarily to the return of part of the new bank's loan portfolio to Glitnir bank at the end of 2008 and in early 2009.
Íslandsbanki´s original press release can be found here.
