Íslandsbanki to Pay ISK 1.2 Billion in Fines

íslandsbanki sale iceland reykjavík

Íslandsbanki has admitted to not fully adhering to proper and sound business practices and procedures in securities trading due to the execution of the offering of a 22.5% stake of the government in the bank, which took place in March last year. The bank has agreed to pay a fine of 1.2 billion Icelandic krónur [$8.8 million, €8.1 million], reports Morgunblaðið.

According to the Financial Supervisory Authority of the Central Bank (FME), the relevant legal requirements were disregarded during the March 2022 sell-off of 22.5% of Íslandsbanki shares. FME also identified inadequate separation of functions and the trading activities of employees as problematic.

In Focus: Íslandsbanki Private Stock Offering

Despite the controversy, Vísir reports that Birna Einarsdóttir, the CEO of Íslandsbanki, is not considering resigning. It is the largest-ever fine imposed on an Icelandic financial institution.

In a statement released yesterday evening, the bank announced that its board had decided to accept the settlement. “There has been talk of potential conflicts of interest that the bank could have addressed more thoroughly, which likely would have resulted in employees not making purchases or certain transactions not being allowed. There is mention of customer classification, risk assessment, and other matters related to this particular project,” stated Birna.

She likewise stated: “We all bear responsibility for our daily tasks. But of course, it is the board, the directors, and the CEO who bear significant responsibility for the bank’s daily operations […] By offering the bank a settlement, the Central Bank is showing us, the board and the CEO, the trust that we will comply with the improvements outlined in the settlement. We wholeheartedly embrace this task and are fully committed to it.”

Read more: FME Believes Íslandsbanki Broke the Law

The press release admits that “in the preparation and execution of the offer, [Íslandsbanki] did not comply with the certain applicable legal requirements and internal rules of the bank on the provision of investment services, particularly in relation to recording of telephone communications, disclosures made to purchasers of shares in the offer, investor classification requirements, and measures to prevent conflicts of interest e.g., segregation of duties and employees transactions […] [I]n executing the offer the bank did not, in all respects, satisfy its obligation to act honestly, fairly and professionally and to promote market integrity […] The bank’s execution of the offer includes serious violations of the relevant laws.”

Íslandsbanki previously recorded a charge of ISK 300 million this year related to the matter and will record a further charge of ISK 860 million this year, for a total of some ISK 1.2 billion.

Íslandsbanki expects its profits during the second quarter of 2023 to be between ISK 5.8 and 6.5 billion [$42-48 million, €39-44 million].



Full House for Meeting on Whaling Decision

Minister of Health Svandís Svavarsdóttir

Members of the Independence Party and the Progressive Party demanded at a town hall meeting in Akranes last night, June 22, that Svandís Svavarsdóttir, the Minister of Fisheries, reconsider her decision to temporarily halt whale hunting. RÚV reports.

The meeting in Akranes was called in response to the recent decision to halt the whale hunting season this year in light of animal welfare concerns. Svandís addressed the reasoning behind the recent decision, acknowledging that people have strong opinions on the matter.

Read More: No Whaling This Summer

“It is always important to base the discussion on facts, genuine knowledge, and reality, but it is natural for people to have strong emotions and heated debates,” the minister stated.

Regarding the short notice of the decision, she explained that she had to quickly assess the potential impact of the advisory board’s recommendations based on the latest report.

Read More: Protest Job Loss Due to Whaling  Ban

“Knowing this, I cannot let the season start, so I made the decision to postpone the beginning in order to attempt to establish better communication with stakeholders and those who are most knowledgeable,” she said.

Teitur Björn Einarsson, representative of the Independence Party, also spoke at the meeting, indicating that the minister’s recent decision may be illegal.

Svandís denied this, referring to the Ministry’s obligation to follow welfare guidelines.

Reykjavík City Pond to Get Four More Islands

Tjörnin Reykjavík Pond

The Reykjavik City Planning and Environmental Council introduced proposed changes to the Reykjavík City Pond (Tjörnin) yesterday, June 22, which include the construction of four new islands.

Proposals for renovating the existing islands and constructing new islands in Tjörnin were presented at the Reykjavik City Planning and Environmental Council this week. It is currently planned to build four new islands in the pond. Currently, Tjörnin has two islets. The larger, northern islet is more visible from downtown. It is around the smaller, southern islet that the proposed new islands will be clustered.

The larger island will also be enlarged and renovated with new gravel, as it has shrunk due to erosion. The changes are intended to benefit bird life in the pond.

Tjörnin is a part of a larger wetland area, consisting of the pools and ponds stemming from the Vatnsmýri marshlands. A stream initially connected Tjörnin to the sea, and this was mostly left untouched as Reykjavík grew in the later part of the 18th century and into the 19th century. In 1911, the city was built over the stream, using it instead as a sewer system.

The latest planned additions to the city pond will not be the only modifications made to it. Over the years, city planners took steps to turn the pond into the modern Tjörnin. In 1913, locks were installed in the pond’s outlet to prevent seawater from surging into the pond. A pedestrian bridge was erected in 1920, cutting the pond in two. The bridge was widened and reinforced to support vehicles during the Second World War.

The project is still in its planning stage. More information can be found at the Reykjavík City website.