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Landsbankinn acquires operations of Sparisjóður Svarfdæla
The Board of Directors of Sparisjóður Svarfdæla and Landsbankinn hf. have reached an agreement whereby Landsbankinn purchases all assets and operations of the savings bank and continues financial activities in Dalvíkurbyggð.
According to the terms of the agreement, Landsbankinn takes over obligations for deposits and a subordinated loan in the total amount of ISK 3200 million and pays the purchase price of ISK 165 million. Furthermore, Landsbankinn assumes all operational obligations of the savings bank.
This is the conclusion of a sale process which began in September 2011 when Icelandic State Financial Investments advertised the State's 90% holding in Sparisjóður Svarfdæla for sale. Various parties evinced interest but only Landsbankinn submitted a binding offer. Icelandic State Financial Investments and Landsbankinn subsequently began negotiations which lead to Landsbankinn making an offer for all assets and operations of the savings bank. The Board of Directors of Sparisjóður Svarfdæla has now accepted that offer, conditional upon approval by guarantee capital owners. They are to meet later this month. Around 150 guarantee capital holders control 10% of shares in the savings bank.
In addition, the purchase offer is conditional upon approval by the Financial Supervisory Authority (FME), the EFTA Surveillance Authority and the Icelandic Competition Authority. Advisors from HF Verðbréf managed the sale process.
"It is gratifying to reach the end of this process which aimed to ensure continued operations and prevent job loss in Dalvíkurbyggð. This goal will be reached if guarantee capital owners approve the offer. Sparisjóður Svarfdæla has operated on an exemption from FME for some time. The operating environment of savings banks has deteriorated lately and there is great uncertainty about their future. While Sparisjóður Svarfdæla will be missed, it is positive that Landsbankinn sees opportunities in Dalvíkurbyggð and is interested in working with the community," says Helga Björk Eiríksdóttir, Chairman of the Board of Directors of Sparisjóður Svarfdæla.
"We at Landsbankinn are pleased to have reached this agreement. This is an opportunity to improve service to our customers in Eyjafjörður, many of whom are domiciled in Dalvíkurbyggð, and to increase Landsbankinn's customer base through the addition of the operations of Sparisjóður Svarfdæla. We are well aware of the savings bank's important history; we respect it and look forward to accommodating its customers at Landsbankinn," says Helgi Teitur Helgason, Managing Director of Retail Banking at Landsbankinn.
Icelandic State Financial Investments, in collaboration with the Board of the savings bank, decided to divest the State's holding via an open sale process. Icelandic State Financial Investments is gratified with the result of the process and, considering the position of the savings bank following financial restructuring, especially pleased to thus ensure continued banking service in the community. Sparisjóður Svarfdæla operates in Dalvík and has an outlet in Hrísey. Employees of the savings bank are nine. Landsbankinn will assume control of the savings bank's operations once all conditions to the agreement have been met.
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