Glitnir releases year-end 2007 results

GlitnirNordic bank Glitnir has announced its full year results for the year 2007:

Financial Highlights

  • ISK 27.7 billion (EUR 315 m) profit after tax
  • 19.3% Return on equity
  • Net income increased by 17.2% year-on-year
  • Pre-tax profit in Q4 was ISK 3.8 billion to ISK 10.4 billion in Q3
  • Net interest income in Q4 was ISK 11.9 billion, up by 54.6% from Q4 06
  • Fees and commissions increased by 7.8% in Q4 and amounted to ISK 10.6 billion
  • 52% of pre-tax profit was generated outside Iceland in 2007
  • Earnings per share for 2007 amounted to ISK 1.86, as compared to ISK 2.68 in 2006
  • Total assets amounted to ISK 2,949 billion, up from ISK 2,246 at the beginning of 2007
  • Assets under management decreased by 6.7% QonQ, by the sale of Glitnir Property Holding, but increased by 91% over the year amounting to ISK 936 billion at year-end
  • Capitalization with CAD ratio at 11.2%, and Tier 1 ratio at 8.1%

Operational Highlights

  • Core income is solid, increasing by 36% year on year
  • Glitnir number two equity broker by turnover in the Nordic Region
  • Profits in Q4 are affected by unfavourable market conditions
  • Costs above acceptable levels which can partly be explained by one-off costs
  • Strong liquidity position in challenging markets
  • Growth strategy focused on niches proven successful

Larus Welding, Glitnir CEO, commented:
“I am pleased to see stable growth in net interest income and fees and commission. Net fees and commission have been consistent throughout the year, totaling ISK 37.6 billion, which is a 42% increase year on year. I am very pleased to see that income from core operations is growing again at a brisk pace of 21%. Glitnir is furthermore reporting a healthy growth in revenues by 17.2% and we have a stable loan portfolio to secure strong net interest income into the year.”

“Glitnir’s three niches, seafood, geothermal and offshore supply vessel are growing as proportion of our loan book, from 11% in 2006 to 13% in 2007. Our focus on our niches is an important investment in Glitnir’s future growth. Additionally Glitnir has become one of the leading players in the Nordic Equity and Brokerage market.”

“2007 has been a year where Glitnir has invested in growth which is clearly reflected in the increase in costs relating to integration of our business units, opening of new operations as well as in one-off costs relating to management change. However we are now moving to a more focused organizational structure, which makes Glitnir well equipped to increase efficiency and control costs through strong regional leadership, with clearer profit and loss responsibility and simple lines of reporting.”

“Last months have been challenging for all financial institutions, but Glitnir is in good position to deal with the situation, with a comfortable liquidity position of more than EUR 6 billion of immediately available funds and a good underlying revenue base. Our loan portfolio is well diversified and of high quality.”

“I am confident our focused strategy creates a solid platform for sustainable growth in all our lines of business,” Larus Welding concluded.

Bjørn Richard Johansen
Managing Director, Corporate Communications
Tel: +47 47 800 100