Two of the biggest banks in Iceland have reported strong Q1 growth despite some slightly erratic macroeconomic signals emerging from the country in recent months.
Glitnir reported record Q1 returns of ISK9.1 billion in net profit – triple that recorded in Q1 2005 – while rival Landsbanki saw net earnings for the first three months rise from ISK7.4 billion last year to ISK17.3 billion.
Both banks cited their international operations as being key drivers of growth as Iceland’s leading commercial institutions – not only banks but also private equity houses – have been busy expanding beyond their Nordic homeland. The Financial Times reports that international investors were worried that the banks would become overly dependent on an overheating Icelandic economy.
The past quarter has been a unique and highly instructive one for Landsbanki, as for other Icelandic financial undertakings, and the Icelandic economy as a whole. Attracting the increased attention of international investors gives Landsbanki additional opportunities to disseminate information on how its activities have been developing. In recent years, the bank’s performance and profitability have been excellent and the first quarter of 2006 was definitely no exception to this trend, says Landbanki’s CEO Halldor Kristjansson.