A meeting of the Board of Directors of Kvika banki hf. (“Kvika” or “the bank”) on 28 January 2021 approved its operating budget for 2021.

Forecast profit for 2021 of ISK 2,600-3,000 million before tax

The budget anticipates a pre-tax profit in the range of ISK 2,600 to 3,000 million.

The Bank's performance may deviate from this forecast, among other things, due to market conditions and other unforeseen events.

A merger with TM hf. and Lykill fjármögnun hf. is anticipated before the end of Q1 2021. Since the approval of supervisory authorities and shareholders of all parties has not yet been obtained the forecast does not include the anticipated financial effects of the merger. Should the merger be approved the change to the forecast will be considerable. A new forecast will be published after the merger is finalised.

Performance above guidance according to preliminary results

According to preliminary results, Kvika's profit in 2020 is expected to be around ISK 2,340 million before tax. The bank's guidance for 2020 was raised in October to an estimated pre-tax profit of ISK 2,000 to 2,300 million.

Kvika’s Board of Directors will propose to a shareholders’ meeting that no dividends be paid in 2021 for the 2020 operating year. This proposal is submitted in view of the proposed merger. The Board of Directors does intend, however, to request that the bank’s Annual General Meeting grant an authorisation for share buy-backs.