26.2.2026 08:00:01 CET | Føroya Banki | Annual Financial Report
Announcement no. 2/2026
"Overall, 2025 was a year characterised by positive trends for the Føroya Banki Group. On the global political scene, the year was marked by geopolitical turmoil and growing uncertainty, putting our ability to navigate in an unpredictable environment to the test.
Our business momentum made up for the low interest rate environment, resulting in a net profit for the year of DKK 288m, which exceeded our expectations at the beginning of the year. This satisfactory performance reflected solid customer activity and a 7% increase in overall business volume. A strong insurance performance and high non-recurring income also contributed significantly to the Group's total income. Costs were kept in line with the guided level, resulting in a cost/income ratio of 52%.
We were able to reverse impairment charges for the ninth year running, reflecting the robust financial position and sound credit quality of our customers. We are thus in a favourable position to further develop our business in 2026 and create value for our customers, our shareholders and our community," says Føroya Banki CEO Turið F. Arge.
At the upcoming Annual General Meeting on 26 March, the Bank intends to propose dividend payments of DKK 202m, or DKK 21.04 per share, representing 70% of the net profit for 2025.
Highlights of Føroya Banki's annual report for 2025:
| DKKm | 2025 | 2024 | Index | Q4 2025 | Q3 2025 | Index | Q2 2025 | Q1 2025 | Q4 2024 |
| Net interest income | 316 | 347 | 91 | 79 | 77 | 102 | 84 | 76 | 78 |
| Net fee and commission income | 84 | 74 | 114 | 24 | 21 | 113 | 19 | 20 | 19 |
| Net insurance income | 76 | 57 | 135 | 20 | 14 | 141 | 27 | 16 | 10 |
| Other operating income (less reclassification) | 58 | 41 | 140 | 10 | 11 | 94 | 24 | 13 | 9 |
| Operating income | 534 | 519 | 103 | 132 | 123 | 108 | 154 | 125 | 117 |
| Operating costs | 280 | 273 | 102 | 70 | 73 | 95 | 68 | 69 | 72 |
| Profit before impairment charges | 255 | 245 | 104 | 63 | 50 | 126 | 86 | 56 | 46 |
| Impairment charges, net | -4 | -1 | 373 | -2 | -9 | 28 | 2 | 5 | -11 |
| Operating profit | 259 | 246 | 105 | 65 | 58 | 111 | 84 | 51 | 57 |
| Investment portfolio earnings | 97 | 136 | 71 | 20 | 22 | 92 | 30 | 25 | 31 |
| Profit before tax | 356 | 382 | 93 | 85 | 80 | 106 | 115 | 76 | 88 |
| Tax | 68 | 72 | 94 | 15 | 17 | 88 | 21 | 15 | 15 |
| Net profit | 288 | 310 | 93 | 71 | 64 | 111 | 93 | 61 | 72 |
| Loans and advances | 9.670 | 9.086 | 106 | 9.670 | 9.598 | 101 | 9.695 | 9.270 | 9.086 |
| Deposits and other debt | 10.948 | 10.003 | 109 | 10.948 | 10.803 | 101 | 10.383 | 10.299 | 10.003 |
| Mortgage credit | 2.824 | 2.741 | 103 | 2.824 | 2.789 | 101 | 2.909 | 2.906 | 2.741 |
| Equity | 2.015 | 2.076 | 97 | 2.015 | 1.945 | 104 | 1.881 | 1.788 | 2.076 |
| Total capital ratio, incl. MREL capital, % | 36,3 | 36,3 | 36,3 | 36,6 | 35,9 | 36,0 | 36,3 | ||
| CET 1 capital, % | 23,3 | 23,8 | 23,3 | 23,1 | 22,7 | 23,5 | 23,8 | ||
| ROE, % | 14,1 | 15,8 | 14,3 | 13,3 | 20,3 | 12,6 | 14,2 | ||
| Liquidity Coverage Ratio (LCR), % | 306,4 | 337,4 | 306,4 | 294,5 | 259,7 | 261,1 | 337,4 | ||
| Operating cost/income, % | 52 | 53 | 53 | 59 | 44 | 55 | 61 | ||
| Number of FTE, end of period | 201 | 207 | 97 | 201 | 202 | 100 | 199 | 204 | 207 |
Business developments
From 2024 to 2025, the Bank's performance was generally characterised by business growth, reflected in a 6% increase in lending, a 9% increase in deposits and a 3% increase in mortgage broking services, mainly driven by the Faroese part of the operations. In addition, premium income from the Group's non-life insurance business grew by 6%. Investments also showed positive momentum, supported by an increase in trading activity via our online banking solution and a 2% increase in assets under management.
Capital ratios
At 31 December 2025, the Group's CET 1 capital ratio was 23.3%, against 23.8% at 31 December 2024. The MREL capital ratio was 36.3% at 31 December 2025, unchanged from 36.3% at 31 December 2024.
Guidance for 2026
The Bank's Management expects a net profit for 2026 in the DKK 195-235m range (2025: DKK 288.3m), corresponding to a RoE of 10-12%. The guidance is subject to uncertainty related to developments in interest rates, returns on the investment portfolio, impairment charges, insurance performance and geopolitical factors.
For further information, please call:
Rúna N. Rasmussen, press contact, tel. (+298) 230 478
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 14.9bn and 201 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 annual report.
