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'''Kaupthing Bank''' ({{lang-is|Kaupþing banki}}) ({{OMX|ICE10905|KAUP}}, OMX Stockholm: KAUP SEK) is an Icelandic bank, headquartered in [[Reykjavík]], [[Iceland]]. It was formed by the merger of ''Kaupthing'' and ''Búnaðarbanki Íslands'' in 2003 and is the third largest bank in Iceland.
'''Kaupthing Bank''' ({{lang-is|Kaupþing banki}}) ({{OMX|ICE10905|KAUP}}, OMX Stockholm: KAUP SEK) is an Icelandic bank, headquartered in [[Reykjavík]], [[Iceland]]. It was formed by the merger of ''Kaupthing'' and ''Búnaðarbanki Íslands'' in 2003 and is the largest bank in Iceland.


Kaupthing Bank previously operated in thirteen countries; including all the Nordic countries, the [[Netherlands]], [[Belgium]], [[Luxembourg]], [[Switzerland]], the [[United Kingdom]] and the [[United States]]. It is the seventh largest bank in the [[Nordic Region|Nordic countries]] in terms of market capitalization.
Kaupthing Bank previously operated in thirteen countries; including all the Nordic countries, the [[Netherlands]], [[Belgium]], [[Luxembourg]], [[Switzerland]], the [[United Kingdom]] and the [[United States]]. It is the seventh largest bank in the [[Nordic Region|Nordic countries]] in terms of market capitalization.

Revision as of 01:34, 20 December 2008

Kaupþing banki hf.
Company typePublic (Nasdaq Iceland: KAUP)
IndustryBanking
FoundedReykjavík, Iceland, 1930 (foundation of Búnaðarbanki)
FateGovernment custodianship, moratorium on payments
SuccessorNýja Kaupþing (Icelandic business only)
HeadquartersReykjavík, Iceland
Key people
Hreiðar Már Sigurðsson (CEO), Sigurður Einarsson (Chairman of the board), Ingólfur Helgason (CEO in Iceland), Ármann Þorvaldsson (CEO in United Kingdom)
Increase €812 million (2007)[1]
Total assets€58.34 billion (2007)[1]
Number of employees
3,330 (2007)[1]
Websitewww.kaupthing.com

Kaupthing Bank (Icelandic: Kaupþing banki) (Nasdaq Iceland: KAUP, OMX Stockholm: KAUP SEK) is an Icelandic bank, headquartered in Reykjavík, Iceland. It was formed by the merger of Kaupthing and Búnaðarbanki Íslands in 2003 and is the largest bank in Iceland.

Kaupthing Bank previously operated in thirteen countries; including all the Nordic countries, the Netherlands, Belgium, Luxembourg, Switzerland, the United Kingdom and the United States. It is the seventh largest bank in the Nordic countries in terms of market capitalization.

The bank employs over 3,300 people and maintains 36 retail branches in Iceland.

As of 31 December 2007, the bank had a total assets of €58.3 billion.[2] In 2006, it ranked number 1,006 on Forbes Global 2000, which is an annual ranking of top 2000 corporations in the world by Forbes magazine.[3] The same year, it ranked number 177 (up by 34 places from 2005) on the list of the world's largest banks composed annually by the international finance magazine The Banker.[4]

In 2007, Kaupthing Bank had net earnings of €812 million, compared with €986 million in 2006. About 70% of the operating profit originated outside Iceland (33% in Iceland, 31% in the UK, 26% in Scandinavia, 8% in Luxembourg and 2% in other countries).[2]

On 9 October 2008, following a major banking and financial crisis in Iceland, the Icelandic Financial Supervisory Authority took control of the bank.[5] So far, it has not been declared bankrupt, although it has obtained a moratorium on payments from the District Court of Reykjavík and has been suspended from trading in the Iceland Stock Exchange.

The name

The bank is known as Kaupthing Bank outside of Iceland.

In Iceland, its official name is Kaupþing Banki hf.

Formerly, its official name was Kaupþing Búnaðarbanki hf., but the name was changed as the former name was considered too unwieldy for most people. From 2003 to 2006 the company used the name KB banki for its retail operations in Iceland. In December 2006, however, the bank started using the old name of Kaupþing for its network of high-street banks. It was announced that the change was part of the bank's plan to operate under the same name.[6]

History

Established in 1982 as a small agency for financial advisory and securities brokerage, Kaupthing has since then been at the forefront of changes in the Icelandic financial market, continually setting trends and being one of the five founding partners of the Icelandic Stock Exchange. In the mid 1990s Kaupthing widened its focus to include opportunities abroad, and becoming the first Icelandic financial institution to operate outside Iceland.

Kaupthing was listed on the Iceland Stock Exchange in October 2000, at which point the original owners of the Bank, the savings banks in Iceland, reduced their holdings, and individuals and institutional investors replaced them as shareholders. Kaupthing Bank shares were listed on the Stockholm Stock Exchange (now OMX Nordic Exchange in Stockholm) in 2002.

By 9 October, Kaupthing Bank HF was forced into government receivership - only days after a crisis at Landsbanki placed it into government control.[7] Due to the crisis throughout the Icelandic financial system, all trading in the country's equity markets was suspended on 13 October 2008.

Acquisitions, mergers, subsidiaries

  • 1930 Búnaðarbanki Íslands (English: Agricultural Bank of Iceland) founded in Iceland
  • 1982 Kaupthing hf. founded in Iceland
  • 1998 Kaupthing Luxembourg, S.A. opened
  • 2000 Kaupthing Faroe Islands opened, Kaupthing New York opened, Kaupthing Stockholm opened
  • 2001 Kaupthing Bank Copenhagen opened, Kaupthing Lausanne opened, Sofi acquired in Finland
  • 2002 Aragon acquired in Sweden, JP Nordiska acquired in Sweden, Auðlind acquired in Iceland
  • 2003 Kaupthing merges with Búnaðarbanki Íslands to form Kaupthing Bank, Tyren acquired in Norway, Norvestia acquired in Finland, Kaupthing Limited opened in the UK
  • 2004 A. Sundvall acquired in Norway, FIH acquired in Denmark
  • 2005 Singer & Friedlander acquired in the UK
  • 2006 Kaupthing Limited merges with Singer & Friedlander to form Kaupthing Singer & Friedlander in the UK
  • 2007 Kaupthing buys Dutch merchant bank NIBC for €3 billion, (as of late January 2008, Kaupthing decided to cancel the acquisition of NIBC)[8]
  • 2007 Kaupthing acquired a 20% stake in New Delhi-based Indian investment services company Finoble Advisors with in option to buy the remaining 80% in 5 year's time [9]
  • 2007 Kaupthing buys Belgian private banking and asset management operations of Robeco Bank, for an unspecified amount, further strengthening its position in the Benelux market.[10][11]
  • 2007 Kaupthing hf acquired Derbyshire Offshore, the Isle of Man subsidiary of Derbyshire Building Society, continuing Derbyshire Offshore's irrevocable and binding guarantee for all depositors funds in the new subsidiary, Kaupthing, Singer and Friedlander (Isle of Man) Ltd.
  • 2007 - 2008 Kaupthing launches internet based Kaupthing Edge[12] in the UK, Belgium, Norway, Germany, Finland, Sweden, Luxembourg, the Isle of Man, Austria and Switzerland.
  • 2008 The UK business of Kaupthing Edge, covering £2.5 billion in deposits and 160,000 customers, is taken over by ING Direct during the market turmoils of the financial crisis of 2007-2008. Kaupthing Singer & Friedlander is placed into administration. The Icelandic Financial Supervisory Authority puts the bank in administration.

Kaupthing Edge

Kaupthing Edge was a pan-European retail deposit taking brand. The purpose of the brand was to diversify liabilities on the Kaupthing balance sheet by currency, customer type (personal/retail) and country. Kaupthing Edge offered two deposit products: a savings account and a fixed term deposit account. Both were straightforward high-interest products. In Belgium customers could choose a third product which was a current account. Kaupthing Edge savings and fixed term deposit accounts were managed over the Internet with the support of telephony call centres.

Kaupthing Edge was available in eleven countries in Europe:

  • Finland - available since October 2007; liabilities taken over by the Finnish Financial Supervision Authority on 9 October 2008[13]
  • Sweden - available since November 2007; accounts closed and all deposits repaid by 20 October 2008.[14]
  • Norway - available since January 2008; liabilities taken over by the Norwegian government on 12 October 2008[15]
  • Belgium - available since January 2008
  • United Kingdom - available since February 2008; accounts transferred to Dutch bank ING Direct on 8 October 2008[16]
  • Germany - available since March 2008; agreement on repayment of 30,000 depositors reached 24 November with a loan of €308 million from Germany to the Icelandic Depositors' and Investors' Guarantee Fund[17]
  • Luxembourg - available since April 2008
  • Isle of Man - available since April 2008; placed into receivership on 9 October 2008[18]
  • Switzerland - available since June 2008; in liquidation from 17 November 2008. Depositors partially repaid. [19]
  • Austria - available since September 2008; accounts frozen on 9 October, accounts transferred to other banks on 29 October[20]

Kaupthing Edge is a word play on 'cutting edge'.

Government takes control

Main article: 2008 Icelandic financial crisis

On 9 October 2008, the Icelandic Financial Supervisory Authority took control of Kaupthing after the resignation of the entire board of directors.[5][21] This came about when "Britain transferred control of the business of Kaupthing Edge, its Internet bank, to ING Direct and put Kaupthing's UK operations into administration" placing Kaupthing in technical default according to loan agreements.[22] The prime minister of Iceland, Geir Haarde, has stated that the British government brought down Kaupthing unnecessarily by abusing their power.

The same day the EKB (Swiss Federal Banking Commission) started proceedings under the Swiss Deposit Insurance scheme[23] with respect to the Geneva branch of Kaupthing Bank Luxembourg. EKB requested customers of that branch to contact them so that compensation of up to 30000 Swiss Francs could be paid.[24]

In Finland, the Financial Supervision Authority (Rahoitustarkastus) took control over the Finnish branch to prevent funds being transferred to Iceland.[13] It has said that it believes that no one will lose their money.[25]

See also

References

  1. ^ a b c "Annual Report 2007". Kaupthing Bank. Retrieved 2008-05-08.
  2. ^ a b Kaupthing
  3. ^ The World's Biggest Public Companies (Forbes Magazine)
  4. ^ Three Icelandic Banks among top 300 in World (Iceland Review Online)
  5. ^ a b The Financial Supervisory Authority - Iceland, News: Based on New Legislation, the Icelandic Financial Supervisory Authority (FME) Proceeds to take Control of Kaupþing to ensure Continued Commercial Bank Operations in Iceland (09.10.2008)
  6. ^ KB banki verður Kaupþing (visir.is)
  7. ^ http://bankrun.us/forums/index.php?topic=3.0 Bank Run at Kaupthing forces seizure
  8. ^ Kaupthing buys NIBC for €3 billion (Times Online)
  9. ^ http://business.timesonline.co.uk/tol/business/industry_sectors/banking_and_finance/article1951069.ece
  10. ^ 2007 Kaupthing opens Middle East offices in Dubai and Qatar
  11. ^ Kaupthing Bank Luxembourg acquires Robeco Bank Belgium (Press Release)
  12. ^ Kaupthing Edge
  13. ^ a b "Suomen Kaupthing jatkaa - "toistaiseksi"". Kauppalehti. 9 October 2008. Retrieved 2008-11-28. {{cite news}}: Italic or bold markup not allowed in: |publisher= (help) Template:Fi icon
  14. ^ Kaupthing Bank Sverige AB (20 October 2008). "Alla kunder i Kaupthing Edge i Sverige har fått sina pengar utbetalda". Template:Sv icon
  15. ^ "Norway takes charge of Kaupthing's Norwegian arm". Reuters. 12 October 2008. Retrieved 2008-10-12.
  16. ^ The Kaupthing Singer & Friedlander Limited Transfer of Certain Rights and Liabilities Order 2008 No. 2674.
  17. ^ Ruhkamp, Stefan; Mußler, Hanno (24 November 2008). "Kritik an Staatshilfe für Kaupthing-Geschädigte". Frankfurter Allgemeine Zeitung. Retrieved 2008-12-06. {{cite news}}: Italic or bold markup not allowed in: |publisher= (help)CS1 maint: multiple names: authors list (link) Template:De icon
  18. ^ Isle of Man Financial Supervision Commission (9 October 2008). "Kaupthing Singer & Friedlander (Isle of Man) Ltd" (PDF). Retrieved 2008-10-18.
  19. ^ [1]
  20. ^ "Österreichische Kaupthing-Kunden erhalten ihr Geld zurück". Die Presse. 29 October 2008. Retrieved 2008-12-06. {{cite news}}: Italic or bold markup not allowed in: |publisher= (help) Template:De icon
  21. ^ "Kaupthing Bank, Press release: Kaupthing Bank turns to the Icelandic FSA". Kaupthing press release. 2008-10-09. Retrieved 2008-10-09.
  22. ^ "Shellshocked [[Iceland]] takes control of biggest bank". Reuters. 2008-10-09. Retrieved 2008-10-08. {{cite web}}: URL–wikilink conflict (help)
  23. ^ Einlagensicherung. Deposit Protection of Swiss Banks and Securities Dealers. Retrieved 2008-10-09 Template:En icon
  24. ^ Einlagensicherung. Retrieved 2008-10-09 Template:De icon
  25. ^ [2]

External links

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