Best bank - íslandsbanki
Best debt house - Búnadarbanki
Best equity house - Kaupthing
Best M&A house - Kaupthing
Best local partner - Búnadarbanki
Iceland is heavily overbanked, with a handful of commercial banks and 24 small savings banks. In May a merger between Búnadarbanki and Kaupthing was approved, creating the country's biggest bank and there is still more scope for consolidation. Because Búnadarbanki and Kaupthing operated as individual institutions during the past year, in making awards Euromoney has had to consider the performance of the individual entities.
The major banks then are íslandsbanki, Landsbanki, Búnadarbanki and Kaupthing. However, Kaupthing is a pure investment bank, while the other three are all-round banking institutions. Of the three, íslandsbanki is still the one to beat and wins the best bank award. It has been the most innovative bank over the past 12 months, has the best credit rating, has the lowest cost-income ratio at 54.8% and has seen top returns. Búnadarbanki and íslandsbanki both posted return on investment of 18.2% at the end of 2002, compared with 13.5% for Landsbanki. íslandsbanki also has the largest market share in total banking sector assets at 26%, the highest share of total loans at 21% and the third-largest share of deposits at 20%.