Kvika banki (KVIKA) investor relations material

Executive summary

• Pre-tax profit reached ISK 1,809 million in Q1 2026, up 158% year-over-year, driven by strong net interest income and normalized costs after prior one-off items.

• Net operating income for Q1 2026 was ISK 4,886 million, up from ISK 4,449 million in Q1 2025.

• Profit after tax for Q1 2026 was ISK 1,374 million, compared to ISK 2,086 million in Q1 2025 (which included discontinued operations).

• Merger discussions with Arion banki were discontinued following regulatory feedback, reinforcing a standalone growth strategy.

• A special dividend of ISK 10.2 billion (ISK 2.35 per share) is proposed, pending shareholder approval.

Financial highlights

• Net interest income rose 12% year-over-year to ISK 3,266 million, supported by 4.5% loan book growth and improved funding costs.

• Net fee and commission income declined 2.3% year-over-year to ISK 1,486 million, reflecting subdued market activity.

• Administrative expenses decreased 2.5% year-over-year to ISK 3,014 million, reflecting cost normalization.

• Net impairment charge increased to ISK 94 million from ISK 65 million in Q1 2025.

• Total assets increased 4.9% year-over-year to ISK 359.8 billion, with loan book growth and a shift toward higher-yielding assets.

Outlook and guidance

• Medium-term return on tangible equity (RoTE) target set at 20%, with capital adequacy ratio (CAR) management buffer of 200–400 bps above requirements.

• Loan book forecast to reach ISK 280–300 billion by 2027, with continued capital returns to shareholders.

• Share buybacks of up to ISK 4 billion planned for 2026, in addition to the special dividend.