Kvika banki (KVIKA) Q3 2025 earnings summary

Executive summary

• Profit before tax rose 8.6% year-over-year to ISK 1,969 million in Q3 2025, with profit after tax up 21.6% to ISK 1,472 million.

• Net operating income for the first nine months of 2025 was ISK 14,439 million, up from ISK 12,519 million year-over-year, with profit before tax from continuing operations at ISK 4,695 million.

• The sale of TM tryggingar hf. was finalized in February 2025, resulting in a final purchase price of ISK 32.2 billion and the group is no longer classified as a financial conglomerate.

• Kvika completed the acquisition of the remaining shares in Ortus Secured Finance Ltd. in March 2025, incurring a revaluation expense of ISK 580 million.

• Merger discussions with Arion banki hf. are ongoing, with due diligence nearing completion and Kvika shareholders expected to receive about 26% of the combined entity.

Financial highlights

• Net operating income for Q3 2025 was ISK 4,862 million, up 9.1% year-over-year.

• Net interest income for 9M 2025 was ISK 8,831 million, up from ISK 7,183 million year-over-year.

• Net fee and commission income was ISK 1,571 million in Q3 and ISK 5,026 million for 9M 2025.

• Administrative expenses increased to ISK 8,811 million from ISK 7,744 million year-over-year.

• Loans to customers grew by ISK 45.5 billion (30.3%) to ISK 195,685 million.

Outlook and guidance

• Loan book growth is on track, supported by strong demand in Auður Heima mortgages and diversified lending.

• Net interest margin remains stable at 4.0%.

• Capital position is strong, with CRR III implementation expected to reduce risk-weighted exposure amount by 14%.

• Merger with Arion banki hf. is anticipated to be finalized in the coming months, pending regulatory and shareholder approval.

• Cautious outlook for asset and domestic capital markets amid a mixed external environment.