Arion banki hf. (ARION_SDB) Q2 2025 Earnings Call

Investor webinar replay

Replay transcript excerpt

Good morning, everyone, and welcome to Arjons Bank presentation on the second quarter results. My name is Ida Brobendistóttir. I'm the deputy CEO and MD of Retail Bank. The agenda for the call today is that I will start by going over the highlights of the quarter and I give a short update on the Icelandic economy and also a short update on the proposed merger, quick merger discussion. And then Benedikt Gislason, the CEO, will go into the numbers in more detail. and give the outlook going forward. But before I start the presentation, I would like to remind our participants online that they can submit questions during the presentation through the message board located below the feed. And we will provide answer to your questions at the end of the webcast. First of all, we are very happy with the strong results of the year and the positive first half. The return on equity attributable to Arion shareholders was 19.7%, bringing the return on equity for the first half to 16.1%, which is well above our medium-term targets of 13%. We saw good momentum in core earning, mostly higher net interest income, as well as very strong quarter in terms of fee and commission income, led by our CIB and markets business unit. We have also reached a milestone in development assets, mainly Ardnaland, that support the evaluation increase of 500 million in the quarter for our 51% ownership in that development project. We saw moderate insurance premium growth and a good increase in our bank insurance ratios during the first half of the year. Werther had a very strong quarter with combined ratio of 79.4%, well below the 95% medium-term targets. Capital optimization is on track and moving closer to optimized levels. CRR3 implementation later this year is expected to have further increase of surpl...