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Statement concerning the Supreme Court verdict of 15 February in Case No. 600/2011
Landsbankinn has recalculated exchange rate indexed loans in accordance with Act No. 38/2001, on Interest and Price Indexation, as amended by Act No. 151/2010. It is clear that the verdict of the Supreme Court necessitates changes to the recalculation method provided for by the Act and used by the bank.
Work will commence immediately on evaluating the precedent set by the verdict. Due to the verdict, it will most likely be necessary to recalculate numerous loans again. The loans in question are housing loans to individuals, loans to companies and loan agreements taken over by Landsbankinn through its merger with savings bank Spkef, SP-Fjármögnun and Avant. It is impossible to say at this time whether the verdict will affect all previously recalculated loans or loans pending recalculation.
According to Landsbankinn's results as of 30 September 2011, its capital ratio (CAD rules) was 23.6%. While recalculation will negatively impact the capital ratio, equity will nevertheless remain well above the prescribed minimum. The end figure will be announced as soon as it is known.
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