Arion banki hf. (ARION_SDB) Q1 2026 Earnings Call

Investor webinar replay

Replay transcript excerpt

Good morning and welcome to Arion bank's presentation for the first quarter results 2026. My name is Oliver Hutskutsum, CFO of Arion bank. For this morning's agenda, I will start by walking you through the key financials of the quarter. Then our CEO, operator, Gieslason will cover the key operational highlights in the quarter, as well as looking at the outlook going forward. Then our Chief Economist, Arion banki Okversody will provide a brief update on the Icelandic economy. Before I start the presentation, I would, as usual, like to remind participants online that you can submit questions throughout the presentation through the message board, which is located below the video feed. We will then provide answers to your questions in the Q and A session at the end of the webcast. So starting as usual with the key highlights from the quarter. First, a solid start to the year, which continues the good momentum from the recent years in Arion bank's operations. Second, from my perspective, of course, a highlight in this quarter is related to the net interest margin. In the past couple of quarters, we have had some short term fluctuations in the margin. We have of course to an extent expected this and continue to guide for this in previous earnings calls. This quarter for an example, saw the Icelandic annualized CPI print measure at around 10% level, which increased from a very low sub 1% level in the fourth quarter last year. This means that while the net interest margin was at the lower end in Q4, it is high this quarter. As of course, with most things in our business, the underlying products driving these fluctuations, namely the CPI linked mortgages, are clearly not priced for a three month period. And we look for a longer term view of real interest rates when managing t...