Landsbankinn hf.: 2023 financial results of Landsbankinn

  • Landsbankinn’s after-tax profit in 2023 was ISK 33.2 billion and return on equity was 11.6%.
  • The Board of Directors intends to propose to the Bank’s AGM that the Bank pay a dividend in the amount of ISK 16.6 billion in 2024.
  • The interest margin of domestic households is 2% and remains stable between years. 
  • Operating expenses rise in line with a general price increase, but the Bank’s cost-income ratio has never been lower, or 33.7%.
  • Profit in the fourth quarter of 2023 was ISK 10.8 billion and return on equity 14.5%.
  • Rising prices of equities and non-domestic bonds in the Bank’s asset portfolio in 2023 amounted to ISK 15.3 billion.
  • For the fifth year in a row, customers in the banking market are most satisfied with Landsbankinn’s services, according to the Icelandic Performance Satisfaction Index 2023.
  • The Bank’s green bond issuance was very successful and green funding now makes up 46.5% of its non-domestic funding profile and 26.6% of total borrowing.
  • The Bank publishes detailed sustainability information today, including calculation of the carbon footprint of its credit portfolio, which has decreased by 8% compared to the reference year, 2019.
  • The Pillar III risk report for 2023 is published alongside the annual financial statements.
  • Landsbankinn’s Annual & Sustainability Report will be published 15 February 2024.

Landsbankinn’s after-tax profit in 2023 was ISK 33.2 billion (2022: ISK 17.0 billion). Return on equity (ROE) was 11.6% in 2023 after tax (2022: 6.3%). Net interest income was ISK 57.6 billion in 2023 (2022: ISK 46.5 billion). The net interest margin on average total asset position was 3.0% in 2023 (2022: 2.7%). Net fee and commission income amounted to ISK 11.2 billion in 2023 (2022: 10.6 billion). Other operating income was positive by ISK 5.1 billion (2022: negative by ISK 3.8 billion). Net gain on financial assets and liabilities at fair value was ISK 6,719 million (2022: ISK 7,936 million loss). Fair value changes to bonds are positive by over ISK 6 billion. Non-domestic base interest rates have increased in 2023 compared with negative interest in 2022. The fair value increase of an unlisted shareholding in Eyrir Invest hf. is ISK 9.3 billion in 2023 (2022: ISK 10,500 million decrease). Net credit impairment was ISK 3.1 billion in 2023 (2022: net release of ISK 2.5 billion), with ISK 1,670 million thereof being a collective provision against uncertainty concerning the financial impact of the seismic and volcanic activity on the Reykjanes peninsula. The change between years is mainly from loans past due and the aforementioned natural disaster, in addition to a credit release from the reversal of a collective provision for Covid-19.


The Bank’s operating income in 2023 was ISK 73.8 billion (2022: ISK 53.3 billion).  
Operating expenses were ISK 28.2 billion in 2023 (2022: ISK 25.9 billion). Of that amount, salaries and related expenses were ISK 15.9 billion (2022: ISK 14.5 billion). Other operating expenses were ISK 10.1 billion in 2023 (2022: ISK 9.3 billion).  
Pre-tax profit in 2023 amounted to ISK 45.6 billion (2022: ISK 27.4 billion). Imputed taxes, including a special tax on the total liabilities of financial undertakings and a special financial management tax on wages, amount to ISK 15.5 billion in 2023, compared with ISK 2022 billion in 2020. ISK 13.2 billion  
The cost/income ratio in 2023 was 33.7% in 2022, down from 43.2% in 2021. 46.8% 
Total assets grew by ISK 173.8 billion between years and amounted to ISK 1,961 billion at year-end 2023. Lending increased by 5.6% between years, or by ISK 86.5 billion. At year-end 2023, deposits from customers amounted to ISK 1,048.5 billion (2022: ISK 967.9 billion) up by ISK 80.7 billion. 
Equity at year-end 2023 amounted to ISK 303.8 billion (2022: ISK 279.1 billion). In 2023, Landsbankinn paid ISK 8.5 bn in dividend to shareholders. The Bank’s CAR at year-end 2023 was 23.6% (2022: 24.7%). The Financial Supervisory Authority of the Central Bank of Iceland (FSA) sets Landsbankinn’s total capital requirement at 20.2%.  
The Board of Directors of Landsbankinn intends to propose to the AGM, scheduled to be held on 20 March 2024, that shareholders be paid a dividend amounting to ISK 0.70 per share for the year 2023, a total amount of ISK 16.6 billion. The dividend is equivalent to 50% of the Group’s 2023 profit. Should this proposal be approved, dividend paid by Landsbankinn in 2013-2024 will amount to ISK 191.7 billion.  

Lilja Björk Einarsdóttir, CEO of Landsbankinn:  
“Landsbankinn delivered robust results in 2023. The Bank is well funded, its cost-income ratio is low by international standards and its dividend capacity is strong. All aspects of the Bank’s operation returned good results and return on equity was 11.6%, higher than the Bank’s long-term profitability target. Higher returns on liquid assets, a turnaround in the stock market, lending growth and altered balance sheet composition are the main drivers of increased profit between years. It is good to see that the household interest margin remains stable despite high interest rate levels.

Landsbankinn’s app and other digital solutions are very popular. Our customers also appreciate being able to get advice and assistance in our 35 branches and outlets throughout Iceland, in addition to access to our extremely capable Customer Service Centre. As visits to branches grow fewer, we have involved employees in rural Iceland in consultations and other service provided over the phone, email and remote meetings; service that doesn’t depend on physical location. This bolsters our operation in all parts of the country, allows us to mitigate pressure and boost service. In 2023, branches in rural Iceland handled 80% of all advisory service in remote meetings and 70% of phone consultations.

Landsbankinn has provided firm support for the people of Grindavík in the uncertainty that continues about seismic and volcanic activity. Our trusted network of fantastic advisors certainly proved their mettle when the Bank contacted all Grindavík customers who have mortgages with the Bank and helped them take advantage of the payment deferral and cancellation of interest and indexation.

The Bank is strongly placed in the corporate market and leading in many sectors, such as seafood and fisheries, and in construction. Around 3,600 apartments currently under construction are financed by the Bank which corresponds to around half of all current construction projects. Landsbankinn Corporate Finance had a very good year and the Bank’s Acquiring Service has been extremely well received since the service was launched in 2022. We will continue to grow Landsbankinn’s service platform and diversify income sources.

The Bank is a leader in open banking as provided for in PSD2, legislation that is intended to support competition in the financial market. Customers reap the benefit of this technological lead, including in Landsbankinn’s app, which now includes features that no other banking app has. This development will continue and we will soon launch new features that will simplify borrowing and refinancing of housing mortgages even simpler.

Successful bond issuance in 2023 is a testament to confidence in the Bank in both domestic and international credit markets. The Bank’s most recent green issuance, which was oversubscribed five times over, was extremely successful and, as a result, now almost 50% of the Bank’s international funding is green.

Economic uncertainty has certainly not lessened in recent months. We all feel the effect of persistent inflation and high interest rates which are increasingly hampering business activities. With that in mind, it is positive to see that even despite more stringent demands made of financial undertakings, the cost of banking service has not increased. To the contrary – concerted efforts spanning several years to achieve simpler and more efficient operations has resulted in one of the lowers cost-income ratio in banking anywhere in the world. This has contributed to a lower interest margin for households. It should also be noted that the Bank’s growing balance sheet allows us to offer the country’s largest companies competitive terms and services. In so doing we contribute to a flourishing domestic economy and continued value creation that forms the foundation for welfare in Iceland. Landsbankinn’s purpose is to ensure trusted banking for the future and we intend to continue to be a leader in Icelandic banking service.”

Landsbankinn’s financial calendar  

  • Annual General Meeting, 20 March 2024  
  • Q1 2024 results 2 May 2024  
  • Q2 2024 results 18 July 2024  
  • Q3 2024 results 23 October 2024  
  • 2024 results 6 February 2025 

For further information contact:

Public Relations, [email protected]

Investor Relations, [email protected]


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