PRESS RELEASE FROM THE CENTRAL BANK OF ICELAND:

Due to the extraordinary circumstances in banking today we have a reason to believe that some payments that should be directed from abroad to Icelandic banks are being halted on their way.

Read the full story

Local media DV.is reported today that, according to their sources, Kaupthing bank would buy Landsbanki with the back-up of the Icelandic government. According to the same source, the problems of Landsbanki have been growing since Glitnir bank was taken over by the Icelandic Government. There have been crisis meetings in closed offices around Reykjavik, the capital of Iceland, where this has been on the agenda.

There seam to be two main talks on how the banks in Iceland will be managed, the first is that Kaupthing is to buy Landsbanki and Glitnir will keep on being in the ownership of the Icelandic government, and the other is that the Icelandic government in cooperation with Landsbanki and Kaupthing will split up Glitnir’s assets and the two banks will take them over.

Nordic bank Glitnir won second prize for ‘Sustainable Deal of the Year‘ at the Financial Times Sustainable Banking awards in London last week.

Glitnir was presented with the award by the CEO of FT, John Ridding, for a deal brokered with US geothermal energy company Hudson Ranch. In it the Nordic bank provided a $15 million loan to develop a new geothermal generating facility in the Salton Sea geothermal field in California.

“The US Geothermal market is very interesting for us as we foresee considerable developments in the energy market especially regarding alternative energy resources,“ said Alexander Richter, Director of Global Industry Research and Communication at Glitnir.

Mr Richter said that Glitnir Bank was among the first financial institution to offer this sort of financial product in the US after last year providing Nevada Geothermal with a similar loan.

“We have a very strong position in the US geothermal market and we intend to strengthen it even further”, said Mr. Richter.

Also speaking at the FT event were the Mayor of London, Boris Johnson and Barclays Chairman, Marcus Agius. Morgan Stanley and BlueOrchard Finance jointly won the Sustainable Deal category.

Visit Glitnir’s website for more information on Glitnir and geothermal energy.

Offshore savings specialists Bradford & Bingley International have relaunched their corporate website and savings accounts range as part of a major rebranding exercise.

Following extensive consumer research, a new range of offshore savings accounts has been developed that offers customers a variety of short, long or fixed term savings accounts with different options for receiving interest.

The new savings range also includes currency savings accounts in US Dollars and Euros, available with annual and deferred interest.

New savings accounts include:

Anyday Saver – a no notice savings account which offers unrestrictive access for every day use.

Future Planning Tracker – a short term savings account that pays up to 6.25% pa and allows no-notice access to deposits. A 0.50% premium is paid when no more than four withdrawals are made during the year.

Reward Saver – a long term savings account offering a high rate of interest of up to 6.40% in return for 90 days notice on withdrawals. The emergency access facility allows withdrawals subject to a loss of 90 days interest.

Interest on the above accounts can be received annually, monthly or even deferred for tax planning purposes.

The popular eSavings internet savings accounts remain unchanged, providing the convenience of 24 hour online account management from anywhere in the world. The eSaver account is currently offering up to 6.40% on balances of £1,000 or more, the top rate of interest being paid when no more than three withdrawals are made per year.

The Isle of Man based bank specialises in offering tax efficient offshore savings accounts for international and expatriate customers. It has customers in over 125 countries, particularly Spain, France and Commonwealth countries.

Visit Bradford & Bingley International’s website for more information on its offshore savings accounts.

Read the full story

A new report from Glitnir indicates that despite cooling economic conditions, Iceland’s seafood industry has a strong outlook for the future, according to reports in intrafish.co.uk.

In order to succeed, like other industries, the fishing industry will need to deal with rising oil prices. Unlike other industries, however, the Icelandic seafood industry will have to tackle the fluctuating nature and policy on cod stocks as well as competition in Asia.

Glitnir pointed out that a growing number of Icelandic seafood companies are taking themselves off the Nasdaq OMX exchange, a factor which is reshaping the industry. Another key factor is the increasing number of consolidations in the industry.

Together, the ten largest fishing companies in Iceland hold approximately 53 per cent of the total allowable catch allocated by the Icelandic government, an increase from 24 per cent in 1992.

Profits have also risen considerably in the industry, despite the increasing price of oil and equipment. Since 1980, profits have almost doubled and currently stand at around 20 percent.

Another change in the industry has been its diminishing role in the Icelandic economy. In 1990, marine products accounted for 56 per cent of all Icelandic exports whereas in 2007, that figure dropped to just 32 per cent.

Glitnir, the Nordic bank, has posted its first quarter profits for 2008. The results show ISK 7.7 billion (EUR 76m) profit before tax, and total recognised income in equity ISK 28.4bn (EUR 280m). The Bank also points to a strong liquidity position of EUR 8.7.

The report has been welcomed as a sign of the bank’s stability even during the global economic downturn. Profit before tax was ISK 7.7bn up 102% from Q4 07 and net operating income highest ever (ISK 25.6bn up 29% from Q4 07).

Glitnir reports that fees and commissions remain strong and that expenses are down 12% from Q4 07. The bank’s loan portfolio continues to grow, and the CAD ratio is strong, at 11.0 percent.

Glitnir reports a healthy pipeline of deals in the Niches and ECM, niches with 60% of advisory fees in the first quarter and says that Capital Markets in Iceland appear to be capitalising on the volatility from FX and securities.
Glitnir is now the 2nd largest broker in the Nordic region, gaining market share to an all time high of 7.37%.

Lárus Welding, Chief Executive Officer says, “Glitnir performed well in the first quarter through a very challenging market conditions for all financials. In spite of these conditions, Glitnir has demonstrated its inherent strengths and these results confirm the Bank’s underlying resilience and flexibility.”

Glitnir’s first quarter results are better than some international observers predicted and will strengthen the growing impression that Iceland’s economy is regaining strength after a difficult half year. Glitnir’s share price was up on the news.

For further information please go to the Glitnir website.

A recent Dow Jones Newswire suggests that Iceland’s central bank may soon be raising their interest rates. The move is expected to occur following the release of inflation information from March by Norway and Denmark on Thursday. If the banks do increase their interest rate, it will be for the second time in just three weeks.

In a survey of economists conducted by Dow Jones Newswire, four out of seven believe that the Central Bank of Iceland will increase its key interest rate on Thursday. The move is expected to help offset pressure from inflation as well as increasing expectations about inflation rates.

This year has seen Iceland’s interest rates increase to unprecedented levels. The last increase came unannounced on March 25th, when the bank instituted a 1.25 percentage point hike, fixing the new rate at 15 per cent.

In the past six months, the declining economic conditions globally have particularly affected the Icelandic economy, with the country’s currency plummeting by 35 per cent during this time. The sharp drop in the value of the currency has only fuelled higher rates of inflation, rates which are well above what the Central Bank had predicted for the period.

In March, Iceland’s annual price rise rate was 8.7 per cent, whereas the bank had predicted a rate of just 2.5 per cent.