Reykajvik (IFN) Icelandic financial services company Straumur-Burdaras Thursday posted a first-quarter net profit of ISK19.1 billion, up sharply from ISK4.6 billion a year ago, mainly thanks to good performance in all its business areas, the divestment of shares, strong trading gains and a high commission income.
The bank also said it is opening a branch in Denmark in the first-quarter.
Net interest income for the three-month period ending March 31 swung to ISK485 million from a previous loss of ISK73 million, and net commission income rose to ISK2.4 billion, compared with ISK205 million in the same quarter in 2005.
First-quarter cost-income ratio was 3.1% as compared to 3.9% for 2005.
In its outlook for the future, the company said it will continue to diversify its income profile in terms of revenue type, product and geographical origin. It will also focus on strengthening the Debt Finance and Corporate Finance divisions to further diversify its income sources and increase the proportion of net interest income and fees relative to total operating income.
Straumur-Burdaras said that growing organically will continue to be a focus, together with increasing emphasis on cross-selling between divisions and on making the entire services of the bank available to clients.
The bank also aims to maintain a strong equity base with a minimum capital adequacy ratio of 15%, and a minimum Return on equity of 16%, it said.
"This is the result of good performance by all the bank's income divisions and reflects our strategy of expanding those divisions providing interest and commission income especially," said Straumur-Burdaras Chief Executive Thordur Mar Johannesson.
"Furthermore, the bank has disposed of a substantial portion of its domestic equities. This achievement has improved diversification of risk in Straumur-Burdaras's operations," he said.
Sources: Dow Jones Newswires; www.icex.is
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