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We are unique in that while our customers enjoy access to first-rate digital solutions that enable them to tend to almost all banking business, we also offer quality personal advice and services to customers around Iceland.

Customer satisfaction with the Bank’s service is high, as reflected in Gallup surveys and the fact that Landsbankinn was ranked highest by banking customers in the Icelandic Performance Satisfaction Index 2020, the second year in a row. Customers overwhelmingly use their phones or computers to do their banking. In recent years, we have introduced a number of innovative solutions that simplify life for our customers. Our aim is to provide service that is accessible whenever and wherever, and 2020 was no exception from the trend of increasing digital services and use thereof. The chapter on smarter banking provides a more in-depth review of our digital services. 

High demand for Landsbankinn housing loans 

We lowered interest rates six times in the course of 2020. Interest rates on non-indexed housing loans with a variable interest rate were lowered from 5.05% to 3.30%. Interest on inflation-indexed loans with a variable interest rate was lowered from 3.20% to 1.90% at year end.

Lower interest rates and a lively real estate market in 2020 boosted demand for housing loans, with electronic processes and signatures proving their worth in lending and refinancing. The Bank’s market share in the housing loan market grew from 22.0% to 26.3% and we think that our endeavours to offer good lending rates, an easy process and short wait times, as well access to professional advice despite restrictions on gatherings, prompted more customers to choose Landsbankinn’s housing loans.  

Some Covid-19 changes will become permanent 

“Our customers were stoic and understanding about restrictions and changes we had to make to services due to Covid-19, and for that we are grateful. Digital solutions and self-service equipment proved their usefulness and we focused our efforts on improving digital services even more to limit the number of issues requiring a physical visit to the Bank. Some business does however necessitate a visit to a branch or a conversation with the Bank. Our resourcefulness was put to the test under strict restrictions on gatherings and closure of the Bank’s branches.

Record number of housing loans at Landsbankinn 

A record number of individuals and families took on housing loans with the Bank in 2020 and demand was high. The Bank’s housing loan portfolio grew by 32% between years and we granted 1,082 housing loans to first-time buyers. 

Overall, we granted housing loans in the total amount of ISK 288 billion in 2020, with the large amount resulting from customers’ refinancing of their housing loans, either to achieve more favourable terms or change from inflation-indexed to non-indexed.

The proportion of customers choosing non-indexed housing loans over inflation-indexed loans has increased in recent years. A complete change occurred in 2020, when 85% of customers selected non-indexed housing loans.

Year of interest rate cuts and new solutions

The economic recession we are experiencing as a result of unavoidable action taken in response to Covid-19, both domestically and abroad, is historic. Here in Iceland, it appears that domestic production has contracted by 8.5% in 2020, constituting the sharpest economic contraction in one year in the history of the Icelandic Republic. The effects are manifold.

Market share  

Landsbankinn has held the highest market share in the retail market seven years running and the lead has grown steadily. The Bank’s data shows that at year-end 2020, market share among individuals 18 years and older was 38.5%. It increased by 0.6 percentage points between years and has never been higher. At the same time, customers are satisfied with our services and confidence in the Bank has grown.

Increase in funding to purchase used vehicles

Many more individuals took on car loans with Landsbankinn in 2020 as compared with the previous year. The total amount of new loans to retail customers grew by over 21.6% between years, a great deal due to funding of the purchase of used vehicles, a testament to the Bank’s strong standing in this market. Individuals took on car loans with the Bank for a total amount of ISK 7.5 billion in 2020. 

Lending for eco-friendly cars grew by 54% 

Over half of all new car registrations in 2020 were alternative fuel vehicles, i.e. electric, plug-in hybrids and other cars not solely dependent on fossil fuels. Electric cars represent over a quarter of all new registrations. This was clearly reflected in the Bank’s lending, as we issued 54% more loans to purchase eco-friendly cards in 2020 than in 2019.

Solutions for customers

We were very focused on finding solutions to support our customers who suffered unexpected income loss through Covid-19. We introduced temporary relief measures, whereby customers could apply for a payment holiday on housing loans. Around 1,400 customers took advantage of this option. Customers could make appointments to consult on payment difficulties. Such consultation included a detailed review of the situation and all available solutions. All applications and contracts for Covid-19 relief measures could be signed electronically.


Customers accrue Aukakrónur when they use their credit cards with our Aukakrónur partners. The purchase discount is up to 20% and, in addition, the Bank adds 0.2-0.5% of all domestic turnover and payments by instalment to the Aukrónur account.

Never before have as many Aukakrónur been accrued as in 2020, or a total of 448 million. Aukakrónur can be used to pay for goods and services with over 240 of the Bank’s partners, just as if they were regular Icelandic krónur. In 2020, customers paid for goods and services with our partners for 358 million Aukakrónur. This spending was largely concentrated in December, as Aukakrónur certainly come in handy in the holiday shopping season. 

Changing needs, changing services 

While we have put a great deal of effort into providing cutting-edge digital services, we continue to build and develop the services offered in our branches and outlets throughout Iceland to meet customer needs. Banking can be tended to through online banking and the app at any time but we are also there for our customers when they need advice or assistance.

Our branches offer financial advice, corporate banking service and assist customers to take self-service solutions into use.

Well prepared to offer appointments 

In early January 2020, we made changes to our branch in Austurstræti. Financial advisory service was moved from Austurstræti to the Vesturbær branch at Hagatorg. Teller services continued to be provided out of the Austurstræti branch, along with various other services, such as the activation of electronic ID and applications for online banking, as well as instruction in the use of the Bank’s digital solutions. Alongside these changes, we offered customers the option to make service appointments in the Vesturbær branch and intended to carry this option over to all bank branches later in the year. 

We were well prepared when Covid-19 hit and arranged service by appointment with very short notice, both in the form of booked consultation calls or physical visits. Customers made 28,400 appointments with us in 2020. Our services were adjusted to altered to meet new conditions, quickly and effectively.

In 2020, we started work on changing Landsbankinn’s branch in Mjóddin in Reykjavík with the aim of offering around the clock access to self-service equipment. Similar changes were made to the Selfoss branch in March, increasing access to self-service equipment and machines. 

Gift card vending machines accessible around the clock 

Landsbankinn's gift card is a popular present, used a great deal by both companies and individuals. To facilitate access to such cards, we opened two new gift card vending machines in the Mjóddin and Vesturbær branches, with 24-hour access. Despite restrictions on access to branches in December, the main season for gift cards, sales were up between years. Our gift cards can also be registered with Apple Pay and the Bank’s card app and used to shop online. 

Self-service equipment around Iceland 

Self-service is not restricted to the app or Internet. ATMs and other self-service equipment can be used to withdraw cash, purchase foreign currency, view account balance and pay invoices. Landsbankinn operates the largest branch and ATM network in Iceland, with 90 ATMs in 63 locations throughout Iceland. We are currently focused on renewing older ATMs and improving access to both ATMs and coin roll dispensers, with, among other things, around the clock access.


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