Announcement no. 6/2026
“Our performance for the first quarter was satisfactory with good momentum in the underlying business and a net profit of DKK 56m. The period was characterised by strong customer activity and deposit, lending and mortgage growth, resulting in an overall 3% increase in business volume. The core business generated income in line with expectations and on a par with the preceding quarter. However, returns on the investment portfolio were lower than expected due to financial market volatility. Costs were in line with the guided level, reflecting continued disciplined cost management. We note with satisfaction that our customers are financially robust with strong credit quality, and that we were consequently able to reverse impairment charges during the quarter. The outlook for the rest of the year is marked by persistent geopolitical tensions and expected rate hikes driven by growing inflation. At the same time, we expect the underlying business to continue its stable, positive development,” says CEO Turið F. Arge.
Highlights of Føroya Banki’s interim report for Q1 2026
| DKKm | Q1 2026 | Q1 2025 | Index | Q1 2026 | Q4 2025 | Index | Q3 2025 | Q2 2025 | Q1 2025 |
| Net interest income | 78 | 76 | 102 | 78 | 79 | 99 | 77 | 84 | 76 |
| Net fee and commission income | 23 | 20 | 115 | 23 | 24 | 95 | 21 | 19 | 20 |
| Net insurance income | 16 | 16 | 105 | 16 | 20 | 82 | 14 | 27 | 16 |
| Other operating income (less reclassification) | 11 | 13 | 86 | 11 | 10 | 112 | 11 | 24 | 13 |
| Operating income | 128 | 125 | 103 | 128 | 132 | 97 | 123 | 154 | 125 |
| Operating costs | 72 | 69 | 104 | 72 | 70 | 103 | 73 | 68 | 69 |
| Profit before impairment charges | 56 | 56 | 101 | 56 | 63 | 90 | 50 | 86 | 56 |
| Impairment charges, net | -1 | 5 | -14 | -1 | -2 | 29 | -9 | 2 | 5 |
| Operating profit | 57 | 51 | 112 | 57 | 65 | 87 | 58 | 84 | 51 |
| Investment portfolio earnings | 13 | 25 | 51 | 13 | 20 | 63 | 22 | 30 | 25 |
| Profit before tax | 70 | 76 | 92 | 70 | 85 | 82 | 80 | 115 | 76 |
| Tax | 14 | 15 | 94 | 14 | 15 | 94 | 17 | 21 | 15 |
| Net profit | 56 | 61 | 92 | 56 | 71 | 79 | 64 | 93 | 61 |
| Loans and advances | 9.774 | 9.270 | 105 | 9.774 | 9.670 | 101 | 9.598 | 9.695 | 9.270 |
| Deposits and other debt | 11.096 | 10.299 | 108 | 11.096 | 10.948 | 101 | 10.803 | 10.383 | 10.299 |
| Mortgage credit | 3.095 | 2.906 | 106 | 3.095 | 2.824 | 110 | 2.789 | 2.909 | 2.906 |
| Equity | 1.870 | 1.788 | 105 | 1.870 | 2.015 | 93 | 1.945 | 1.881 | 1.788 |
| Total capital ratio, incl. MREL capital, % | 40,2 | 36,0 | 40,2 | 36,3 | 36,6 | 35,9 | 36,0 | ||
| CET 1 capital, % | 25,5 | 23,5 | 25,5 | 23,3 | 23,1 | 22,7 | 23,5 | ||
| ROE, % | 11,5 | 12,6 | 11,5 | 14,3 | 13,3 | 20,3 | 12,6 | ||
| Liquidity Coverage Ratio (LCR), % | 322,4 | 261,1 | 322,4 | 306,4 | 294,5 | 259,7 | 261,1 | ||
| Operating cost/income, % | 56 | 55 | 56 | 53 | 59 | 44 | 55 | ||
| Number of FTE, end of period | 207 | 204 | 101 | 207 | 201 | 103 | 202 | 199 | 204 |
Business developments
Overall, the first quarter was characterised by business volume growth, reflected in a 1% increase in lending, a 1% increase in deposits and a 10% increase in mortgage activities compared to Q4 2025. Premium income from the Group’s non-life insurance business grew by 4%, and investments were stable with an unchanged level of assets under management during the period. The total business volume grew by 3% during Q1 2026.
Capital ratios
At 31 March 2026, the Group’s CET 1 capital ratio was 25.5%, against 23.5% at 31 December 2025. The total capital ratio including MREL was 40.2% at 31 March 2026, against 36.3% at 31 December 2025. At 1 January 2026, the Capital Requirements Regulation (CRR3) was implemented in the Faroe Islands. Its effect on REA was lower credit risk and lower operational risk. The above capital ratio developments were due to the implementation of CRR3. The net profit of DKK 56m for Q1 2026 is not included in the calculation of capital ratios.
Guidance for 2026
The Bank confirms the previously announced 2026 net profit guidance of DKK 195–235m.The guidance is subject to uncertainty related to developments in interest rates, returns on the investment portfolio, impairment charges, insurance performance and geopolitical factors.
Føroya Banki has banking activities in Greenland and the Faroe Islands and insurance activities in the Faroe Islands. Founded in the Faroe Islands 120 years ago, the Group has total assets of DKK 15.0bn and 207 employees. The Bank is subject to the supervision of the Danish Financial Supervisory Authority and is listed on Nasdaq Copenhagen.
Further details are available in the Q1 2026 interim report.
For further information, please call:
Rúna N. Rasmussen, Investor Relations, tel. (+298) 230 478
