Moody’s Investors Service (“Moody’s”) has today placed Kvika Banki hf.’s (“Kvika”) deposit and issuer ratings on review for upgrade as merger discussions with Íslandsbanki hf. commence.

Given the review for upgrade, Moody’s is unlikely to downgrade Kvika’s ratings during the review period. However, failure to proceed with the merger would result into Kvika’s ratings to be confirmed at current levels provided that the bank continues to exhibit resilient financial performance.

The review is placed on Kvika’s long-term deposit ratings of Baa1 and issuer ratings of Baa2. Furthermore, Moody’s also placed the bank’s Baseline Credit Assessment (BCA) and Adjusted BCA of ba1, the long-term Counterparty Risk (CR) Assessment of Baa1(cr) and Counterparty Risk Ratings (CRRs) of Baa1 on review for upgrade. The outlook on the long-term deposit and issuer ratings was previously stable. Moody’s also placed on review for upgrade Kvika’s short-term deposit ratings of P-2, short-term CRRs of P-2 and short-term CR Assessment of P-2(cr).

Please note that this notice is a disclosure of inside information per article 17 of regulation (EU) No 596/2014 on market abuse (“MAR”), which is implemented into Icelandic law with the act on measures against market abuse No 60/2021.