Kvika banki (KVIKA) Q4 2025 earnings summary

Executive summary

• Completed sale of TM to Landsbankinn for ISK 32.3 billion and finalized full acquisition of Ortus, enabling integration and lower funding costs.

• Launched Auður Heima mortgages, reaching ISK 23.2 billion in the loan book by year-end.

• Achieved record distribution to shareholders of ISK 27 billion and completed Iceland's largest share offering, raising ISK 90.5 billion.

• Initiated merger negotiations with Arion following a competitive bidding process.

Financial highlights

• Net interest income for Q4 2025 was ISK 3,065 million, up 22.7% YoY; net fee and commission income was ISK 1,265 million, down 21.0% YoY.

• Profit before tax for Q4 2025 was ISK 1,522 million, a 4.9% decrease YoY; after-tax profit was ISK 1,266 million.

• For 12M 2025, net interest income rose 22.9% YoY to ISK 11,896 million; net operating income grew 13.0% YoY to ISK 19,411 million.

• Administrative expenses increased 13.9% YoY in Q4 and 13.8% YoY for 12M 2025, partly due to merger-related costs.

• Normalized profit before tax for 12M 2025 grew 25.4% YoY when adjusted for one-off items.

Outlook and guidance

• Loan book forecast to reach ISK 280-300 billion by 2027, with continued capital return to shareholders expected.

• Capital optimization in 2026 may release up to ISK 15 billion, supporting a 20% ROTE target.

• Merger process with Arion ongoing, with regulatory discussions in progress.