Interim report
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Condensed Consolidated Interim Financial Statements ____________________________________ 1 January to 30 September 2026 Table of Contents Report and Endorsement by the Board of Directors and the CEO 2 Condensed Consolidated Interim Income Statement 5 Condensed Consolidated Interim Statement of Comprehensive Income 6 Condensed Consolidated Interim Statement of Financial Position 7 Condensed Consolidated Interim Statement of Changes in Equity 8 Condensed Consolidated Interim Statement of Cash Flows 9 Notes to the Condensed Consolidated Interim Financial Statements 10
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Condensed Consolidated Interim Financial Statements 30 September 2026 2 Report and Endorsement by the Board of Directors and the CEO The condensed consolidated interim financial statements of Skagi hf. ("the Company” or “Skagi”) for the period 1 January to 30 September 2026 consist of the financial statements of the Company and its subsidiaries. Subsidiaries include VÍS tryggingar hf. (“VÍS”), Fossar fjárfestingarbanki hf. (“Fossar” or “the bank”), Íslensk verðbréf hf. (“ÍV”), and Líftryggingafélag Íslands hf. (“Lífís”), collectively with the Company referred to as "the Group". The Group’s operations consist of insurance activities, investment banking, asset and fund management. The financial statements are prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the EU and the additional requirements for companies listed on a regulated securities market. The condensed consolidated interim financial statements have not been reviewed or audited by Independent Auditors of the Company. Operating and Financial position According to the Income Statement the Group's profit for the first nine months of 2026 amounted to ISK 1.207 million and return on equity was 5.3% during the period. The Group's assets at the end of the period amounted to ISK 83,489 million and equity amounted to ISK 23,125 million according to the balance sheet. Insurance The insurance business continued to grow through disciplined execution of its strategy, delivering strong premium growth and improved operational efficiency. A focused approach to target customer segments, key insurance products and continued simplification supports scalable, profitable growth. Insurance business generated 7.4% insurance revenue growth and thereof 10.8% life and health insurance growth in 9M 2026. Cost ratio stood at 17.2% in the first nine months of 2026 (9M 2025: 17.9%) and claims and reinsurance ratio was 69.8% (9M 2025: 69.8%). This results in a combined ratio of 87.0% (9M 2025: 87.7%). The insurance service result was positive by ISK 3,315 million in the first nine months of 2026 (9M 2025: ISK 2,920 million). Financial Services Revenue of financial services activities declined by 11.3% in the first nine months of 2026 compared to prior year. Revenue of financial activities totalled ISK 1,961 million (9M 2025: ISK 2,212 million). Fossar revenue declined by ISK 364 million YoY (-22.9%) whilst revenue of Íslensk verðbréf increased by ISK 114 million YoY (18.4%). Assets under management (AuM) at the Skagi Group stand at 245 billion at the end of 9M 2026 (9M 2025: ISK 236 billion) and grew 3.8% year-on-year. Financial services delivered a loss before tax of ISK 172 million in the first nine months of 2026 (9M 2025: profit before tax 2 million), negatively affected by costs related to Fossar CEO transition and headcount reduction amounting to ISK 120 million. Fossar’s loss before tax amounted to ISK 263 million whilst Íslensk verðbréf profit before tax amounted to ISK 91 million in the first nine months 2026. Investments The return on the insurance investment assets in 9M 2026 was 2.0% (9M 2025: 0.9%). Investments generated financial income of ISK 999 million in the first nine months of 2026 (9M 2025: ISK 431 million) but a negative net financial income of ISK -732 million in 9M 2026 (9M 2025: ISK -1,591 million).
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Condensed Consolidated Interim Financial Statements 30 September 2026 3 Report and Endorsement by the Board of Directors and the CEO Financial Targets 2026 Following a review of the Group's operating performance for the first nine months of 2026, Skagi updated its financial guidance for the full year 2026. The updated guidance is as follows: Combined ratio range 90% - 93% Financial services revenue is expected to be within the range ISK 2,700 – 3,200 million The expected return on insurance investments assets is 9.5% Skagi will provide an update on guidance if operating performance is not likely to be in target range in insurance business and financial services. No update is given in between quarterly reporting with respect to the expected investment return of insurance investments. Shares and allocation of profits The Company issued 24,231,800 nominal shares on 23rd March to the sellers of 14.1% shareholding in Íslensk verðbréf hf., following approval by the AGM on 17th March. The Company's nominal shares amounted to ISK 1.940,3 million at period end (own shares amounting to ISK 80.7 million), with each share having a nominal value of ISK 1. There were 851 shareholders at the end of the period. The board of directors' proposal for the payment of a dividend of ISK 0.3988 per share, in the amount of approx. ISK 760 million, was approved at the Company's Annual General Meeting on 17th March and the Company paid the dividend to shareholders on 1st April 2026. Share repurchase programs Skagi commenced a share repurchase program on 2nd March 2026 in the amount of 40 million shares at nominal value and completed the buyback on 29th May 2026 for total purchase price of ISK 721 million. On 29th May Skagi commenced another share repurchase program buying 22.2 million shares at nominal value and purchase price of up to 407 million, which was concluded on 15th July 2026. Third round of repurchases was commenced at 20th July and was concluded on 15th of September, buying 8.2 million shares at nominal value and purchase price of ISK 153 million.
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Condensed Consolidated Interim Financial Statements 30 September 2026 4 Report and Endorsement by the Board of Directors and the CEO To the best knowledge of the board the consolidated interim financial statements of Skagi hf. give a true and fair view of the consolidated financial performance of the Group for the period 1 January to 30 September 2026, and its assets, liabilities, and financial position as of 30 September 2026. Further, in our opinion the consolidated interim financial statements give a fair view of the development and performance of the Group's operations and its position at the end of the period and describe the principal risks faced by the Group. The Board of Directors and the CEO have today discussed the Company's Condensed Consolidated Interim Financial Statements of Skagi hf. for the period ended 30 September 2026 and confirm by means of their signatures. Reykjavik, 28 October.26 On the Board of Directors Stefán Héðinn Stefánsson Vilhjálmur Egilsson Chairman of the Board Vice-Chairman of the Board Marta Guðrún Blöndal Ásgeir Helgi Reykfjörð Gylfason Hrund Rudolfsdóttir CEO Guðný Helga Herbertsdóttir
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Condensed Consolidated Interim Financial Statements 30 September 2026 5 All amounts are in thousands of ISK Condensed Consolidated Interim Income Statement For the period 1 January to 30 September 2026 The notes on pages 10-22 are an integral part of these financial statements. Notes Q3 2026 Q3 2025 YTD 2026 YTD 20259.042.331 8.368.737 25.516.309 23.754.769(5.800.266) (5.240.882) (17.225.757) (15.773.571)6 (1.344.354) (1.349.502) (4.398.174) (4.246.577)(167.080) (307.324) (577.467) (814.809)Insurance service result 1.730.631 1.471.029 3.314.912 2.919.812559.101 555.372 1.666.885 1.583.280(419.447) (432.542) (1.242.155) (1.260.428)Net interest income 139.654 122.830 424.730 322.852460.537 495.223 1.547.011 1.721.431(14.908) (15.340) (50.118) (49.928)Net fee and commission income 445.628 479.882 1.496.893 1.671.504178.017 491.103 896.678 442.796(245.091) (531.641) (998.447) (1.308.720)(201.974) (135.064) (495.848) (388.544)(74.216) (70.488) (237.520) (227.886)Net financial income (343.264) (246.090) (835.137) (1.482.354)0 0 23.636 51.45044.026 39.903 164.633 163.726Net operating income 2.016.675 1.867.555 4.589.667 3.646.9896 (717.782) (759.438) (2.481.782) (2.541.775)(26.806) (2.309) (33.487) (6.377)(47.850) (49.170) (146.506) (146.503)Profit before tax 1.224.236 1.056.638 1.927.892 952.334(412.245) (339.241) (720.873) (615.318)Profit for the period811.991 717.397 1.207.019 337.016811.991 715.751 1.207.019 337.5870 1.647 0 (570)Profit for the period811.991 717.397 1.207.019 337.016Earnings per share0,43 0,38 0,64 0,18 0,43 0,36 0,64 0,17 Share in profit of associates, after income tax ...................................Other operating income .....................................................................Operating expenses ...........................................................................Net credit impairments .......................................................................Amortization of intangible assets .......................................................Income tax expenses .........................................................................Attributable to shareholders ...............................................................Basic earnings per share ...................................................................Diluted earnings per share .................................................................Attributable to minority interest ........................................................... Interest expenses ...............................................................................Fee and commission income .............................................................Fee and commission expenses .........................................................Financial income ................................................................................Net finance expenses from insurance contracts ................................Other financial items ..........................................................................Operating expense of the insurance investment portfolio ..................Insurance revenue .............................................................................Insurance expenses ...........................................................................Insurance contract operating expenses .............................................Net expenses from reinsurance contracts .........................................Interest income ..................................................................................
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Condensed Consolidated Interim Financial Statements 30 September 2026 6 All amounts are in thousands of ISK Condensed Consolidated Interim Statement of Comprehensive Income For the period 1 January to 30 September 2026 The notes on pages 10-22 are an integral part of these financial statements. YTD 2026 YTD 2025Profit for the period1.207.019 337.016Other Comprehensive incomeItems that are or may be reclassified subsequently to profit and loss and relocated to equity0 12.880(27.928) (1.612)Total comprehensive income for the period1.179.091 348.285Unrealized fair value changes ....................................................................................................................................Reclassification of fair value changes to income statement .......................................................................................
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Condensed Consolidated Interim Financial Statements 30 September 2026 7 All amounts are in thousands of ISK Condensed Consolidated Interim Statement of Financial Position As at 30 September 2026 The notes on pages 10-22 are an integral part of these financial statements. Notes 30.9.2026 31.12.2025Assets2.970.564 1.750.0257 57.549.662 55.888.9701.169.124 3.109.52411.184.701 11.836.508192.472 162.132743.697 882.14410 235.672 212.1404.459.719 4.558.7851.090.156 1.384.416127.895 196.0901.114.718 960.6182.650.554 4.093.66583.488.934 85.035.018Liabilities11 31.923.560 30.331.427743.697 882.14412 18.185.722 20.953.7794.027.933 3.907.7203.591 254.9811.037.260 1.126.536459.963 435.6673.982.606 3.158.53060.364.332 61.050.782Equity1.859.654 1.905.7473.703.477 3.254.4322.712.679 2.740.60714.848.793 16.037.49923.124.602 23.938.2850 45.95023.124.602 23.984.23583.488.934 85.035.018 Loans to customers ...................................................................................................................Derivatives .................................................................................................................................Investments where investment risk is borne by life-insurance policy holders ...........................Cash and cash equivalents .......................................................................................................Financial assets .........................................................................................................................Securities used for economic hedging ......................................................................................Other receivables ......................................................................................................................Total assetsInsurance contract liabilities ......................................................................................................Investment in associates ...........................................................................................................Intangible assets ........................................................................................................................Property and equipment ............................................................................................................Deferred income tax asset ........................................................................................................Assets from reinsurance contracts held ....................................................................................Derivatives .................................................................................................................................Lease liability .............................................................................................................................Deferred income tax liability ......................................................................................................Investment contract liabilities .....................................................................................................Financial liabilities ......................................................................................................................Subordinated bond ....................................................................................................................Retained earnings .....................................................................................................................Total equity attributable to shareholders ...................................................................................Minority interest .........................................................................................................................Total equityTotal liabilities and equityAccounts payable and other liabilities ........................................................................................Total liabilitiesShare capital ..............................................................................................................................Share premium ..........................................................................................................................Restricted reserves ....................................................................................................................
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Condensed Consolidated Interim Financial Statements 30 September 2026 8 All amounts are in thousands of ISK Condensed Consolidated Interim Statement of Changes in Equity For the period 1 January to 30 September 2026 The notes on pages 10-22 are an integral part of these financial statements. Unrealisedprofit ofShare Share Restricted subsidiaries Retained Minoritycapital premium reserve and associates earnings interest TotalEquity 1.1.2026 ..........................................................................1.905.747 3.254.432 630.017 2.110.590 16.037.499 45.950 23.984.235Profit (loss) for the period ............................................................ 1.207.019 1.207.019Other comprehensive income (loss) ........................................... 0 (27.928) 0 (27.928)Total comprehensive income (loss) for the period ...................... 0 0 0 0 1.179.091 0 1.179.091Change of holding in subsidiary .................................................. 24.232 449.044 (427.326) (45.950) 0Treasury shares acquired ........................................................... (70.325) 0 (1.210.707) (1.281.032)Dividends paid, ISK 0,3988 per share ........................................ (757.692) (757.692)Restricted reserves ..................................................................... (27.928) 27.928 0Equity 30.9.2026 ........................................................................1.859.654 3.703.477 602.089 2.110.590 14.848.793 0 23.124.602Equity 1.1.2025 ..........................................................................1.895.958 3.087.000 2.684.635 0 14.563.951 39.209 22.270.753Profit (loss) for the period ............................................................ 337.587 (570) 337.016Other comprehensive income (loss) ........................................... 11.268 0 11.268Total comprehensive income (loss) for the period ...................... 0 0 0 0 348.855 (570) 348.285Change of holding in subsidiary .................................................. (4.932) 4.932 0Treasury shares allocation .......................................................... 410 8.128 8.538Dividends paid, ISK 0,264 per share .......................................... (500.072) (500.072)Restricted reserves ..................................................................... (2.047.747) 0 2.047.747 0Equity 30.9.2025 ........................................................................1.896.367 3.087.000 636.888 0 16.463.677 43.571 22.127.504 Other restricted equity
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Condensed Consolidated Interim Financial Statements 30 September 2026 9 All amounts are in thousands of ISK Condensed Consolidated Interim Statement of Cash Flows For the period 1 January to 30 September 2026 The notes on pages 10-22 are an integral part of these financial statements. YTD 2026 YTD 2025Operating activities1.207.019 337.016(424.730) (322.852)(449.294) (73.116)0 8.538(23.636) (51.450)1.026 (1.334)490.480 457.634800.865 354.437(591.884) (1.726.067)(152.904) 299.9471.940.401 435.506651.807 (2.862.668)1.998.474 (960.681)(281.730) (392.470)1.592.134 529.273575.070 603.167Cash flows from (to) operating activities before interest and tax 6.532.232 (3.719.557)1.194.355 1.508.771320.937 335.849(1.608.410) (1.507.115)(214.957) (97.814)Cash flows from (to) operating activities6.224.156 (3.479.866)Investing activities(27.219) (125.055)23.243 7.700(48.415) (12.364)0 47.686(52.391) (82.033)Financing activities(1.281.032) 0(757.692) (500.072)(135.064) (130.667)(2.768.057) 3.430.286(4.941.845) 2.799.5471.229.919 (762.352)1.750.025 2.321.959(9.379) (56.971)2.970.564 1.502.636Dividends paid .................................................................................................................... Assets from reinsurance contracts held, change ............................................................Other receivables, change ...............................................................................................Profit for the period .............................................................................................................Changes in operating assets and liabilities:Financial assets, change .................................................................................................Operating items not affecting cash flows:Net interest income .........................................................................................................Depreciation and amortization ........................................................................................Net financial income ........................................................................................................Derivatives, change ......................................................................................................... Cash and cash equivalents at the end of the period ..........................................................Principal payments of lease liability ....................................................................................Change in cash and cash equivalents ...............................................................................Effect of movements in exchange rates on cash held .......................................................Cash and cash equivalents at the beginning of the year ....................................................Short-term loans, change ...................................................................................................Investments in intangible assets ........................................................................................Dividend received ...............................................................................................................Securities, change ...........................................................................................................Loans to customers, change ...........................................................................................Investments in property and equipment .............................................................................Accounts payable and other liabilities, change ................................................................Financial expenses paid .....................................................................................................Insurance contract liabilities, change ...............................................................................Interest income received ....................................................................................................Stock options, change ..................................................................................................... Purchase of treasury shares .............................................................................................. Share in profit of associate ..............................................................................................Loss (profit) on sale of operating assets ......................................................................... Sale of property and equipment .........................................................................................Income taxes paid ..............................................................................................................Dividends received from associate ....................................................................................
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Condensed Consolidated Interim Financial Statements 30 September 2026 10 Notes to the Condensed Consolidated Interim Financial Statements Note support table of contents 1. Reporting entity ............................................................... 11 2. Basis of preparation ........................................................ 11 3. Functional and presentation currency .............................. 11 4. Accounting estimates...................................................... 11 5. Operating segment reporting ........................................... 12 6. Operating expenses ........................................................ 14 7. Financial assets .............................................................. 14 8. Loans to customers ........................................................ 15 9. Group entities ................................................................. 17 10. Investment in associates ................................................. 17 11. Insurance contract liabilities ........................................... 17 12. Financial liabilities .......................................................... 18 13. Solvency of a financial conglomerate ............................... 19 14. Solvency of insurance activities ....................................... 20 15. Fossar capital adequacy ratio .......................................... 21 16. Events after the reporting date ......................................... 21 17. Quarterly statement and key ratios .................................. 22
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Condensed Consolidated Interim Financial Statements 30 September 2026 11 All amounts are in thousands of ISK Notes to the Condensed Consolidated Interim Financial Statements 1. Reporting entity Skagi hf., the Parent Company, hereinafter referred to as "the Company" or "Skagi“, is a limited liability company incorporated and domiciled in Iceland. Skagi operates on the basis of Act no. 2/1995 on Limited Liability Companies, Act no. 61/2017 on Supplementary supervision of Financial Conglomerates, Act no. 60/2017 on Insurance Conglomerates and certain applicable provisions in Act no. 100/2016 on Insurance Activities and Act no. 161/2002 on Financial Institutions. The Company is supervised by the Financial Supervisory Authority of the Central Bank of Iceland. The Company's headquarters are at Ármúli 3, Reykjavík. The condensed consolidated interim financial statements of Skagi hf. ("the Company” or “Skagi”) for the period 1 January to 30 September 2026 consist of the financial statements of the Company and its subsidiaries. Subsidiaries include VÍS tryggingar hf. (“VÍS”), Fossar fjárfestingarbanki hf. (“Fossar” or “the bank”), Íslensk verðbréf hf. (“ÍV”) and Líftryggingafélag Íslands hf. (“Lífís”), collectively with the Company referred to as "the Group". The Group’s operations consist of insurance activities, investment banking and asset and fund management. 2. Basis of preparation The condensed consolidated interim financial statements have been prepared in accordance with International Accounting Standard IAS 34 Interim Financial Reporting, as adopted by the European Union and additional requirements according to the Icelandic Financial Statements Act. The interim financial statements were approved and authorized for publication at a meeting of the Board of Directors on 28 October 2026. The notes on pages 10-22 are an integral part of these condensed interim financial statements. The condensed consolidated interim financial statements do not include a detailed discussion of material accounting policies. For a full description of accounting policies and principles applied and changes in comparative figures, please refer to the most recent consolidated annual financial statements of the Company. 3. Functional and presentation currency The condensed consolidated interim financial statements are prepared and presented in Icelandic krónur (ISK), which is the Company's functional currency. All amounts are presented in thousands of ISK unless otherwise stated. 4. Accounting estimates Preparing condensed consolidated interim financial statements in accordance with IFRS requires management to make assumptions, estimates and apply judgement that affect the assets and liabilities at the reporting date, disclosures in notes and income and expenses. Estimates and judgements are based on experience and various other factors that are considered appropriate and form the basis of decisions made regarding the reported amounts of assets and liabilities not evident by other means. Estimates and assumptions are reviewed regularly. Changes in accounting estimates are recognized in the period when they are revised. Goodwill Assets such as goodwill are subject to annual impairment testing, or more frequently when there is an indication of impairment. Goodwill is allocated to cash generating units ("CGUs") for the purpose of impairment testing. Goodwill has been allocated to the following CGUs; Insurance operations and Financial Services operations. The allocation is made to those CGUs or groups of CGUs that are expected to benefit from the business combinations in which the goodwill arose. At the end of the reporting period there are no triggers indicating that impairment of goodwill is required.
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Condensed Consolidated Interim Financial Statements 30 September 2026 12 All amounts are in thousands of ISK Notes to the Condensed Consolidated Interim Financial Statements 5. Operating segment reporting The Group is divided into three operating segments: Insurance operations, Insurance investments and Financial services, in accordance with the Group's organization and internal structure. Insurance operations include the VÍS insurance and Lífís life insurance business units. Insurance investments include the investment operations of the insurance business (VÍS and Lífís). Financial services include the operations of Fossar and ÍV. The operating segments' results for the period 1 January to 30 September 2026 are specified as follows: CentralizedInsurance Insurance Financial supporting unitsoperations investments services and eliminations TotalInsurance revenue ...................................................................... 25.516.309 25.516.309Claims incurred ........................................................................... (17.225.757) (17.225.757)Insurance contract operating expenses ...................................... (4.398.174) (4.398.174)Net expenses from reinsurance contracts .................................. (577.467) (577.467)Insurance service result .............................................................. 3.314.912 0 0 0 3.314.912Net interest income ..................................................................... 424.730 424.730Net fee and commission income ................................................ 1.583.536 (86.643) 1.496.893Financial income ......................................................................... 998.911 (48.464) (53.770) 896.678Operating exp. of the insurance investment portfolio ................. (237.520) (237.520)Net finance expenses from insurance contracts ........................(998.447)(998.447)Other financial items ................................................................... (390.196) (105.652) (495.848)Net financial income ................................................................... 0 (627.251) (48.464) (159.421) (835.137)Other operating income .............................................................. 162.953 1.590 90 164.633Share in profit of associates, after income tax ........................... 23.636 23.636Net operating income ................................................................. 3.477.864 (627.251) 1.961.393 (222.338) 4.589.667Operating expenses ................................................................... (142.869) (2.035.820) (303.093) (2.481.782)Allocated costs from supporting units ......................................... (113.116) (104.415) (49.030) 266.561 0Amortization of intangible assets ................................................ (15.256) (131.250) (146.506)Net credit impairments ................................................................ (33.487) (33.487)Profit (loss) before tax 3.221.879 (731.666) (172.200) (390.121) 1.927.892(720.873)1.207.019Income tax expenses ...................................................................................................................................................................................................Profit for the period ......................................................................................................................................................................................................
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Condensed Consolidated Interim Financial Statements 30 September 2026 13 All amounts are in thousands of ISK Notes to the Condensed Consolidated Interim Financial Statements 5. Operating segment reporting (cont.) The operating segments' results for the period 1 January to 30 September 2025 are specified as follows: *The presentation of comparative figures has been revised. CentralizedInsurance Insurance Financial supporting unitsoperations Investments services and eliminations TotalInsurance revenue ...................................................................... 23.754.769 23.754.769Claims incurred ........................................................................... (15.773.571) (15.773.571)Insurance contract operating expenses ...................................... (4.246.577) (4.246.577)Net expenses from reinsurance contracts .................................. (814.809) (814.809)Insurance service result .............................................................. 2.919.812 0 0 0 2.919.812Net interest income ..................................................................... 322.852 322.852Net fee and commission income ................................................ 1.826.681 (155.178) 1.671.504Financial income ......................................................................... 430.501 59.429 (47.134) 442.796Operating exp. of the insurance investment portfolio ................. (227.886) (227.886)Net finance expenses from insurance contracts ........................ (1.308.720) (1.308.720)Other financial items ................................................................... (314.314) (74.230) (388.544)Net financial income ................................................................... 0 (1.420.420) 59.429 (121.364) (1.482.354)Other operating income .............................................................. 162.450 2.572 (1.296) 163.726Share in profit of associates, after income tax ........................... 51.450 51.450Net operating income ................................................................. 3.082.262 (1.420.420) 2.211.534 (226.388) 3.646.989Operating expenses ................................................................... (122.804) (2.130.505) (288.466) (2.541.775)Allocated costs from supporting units ......................................... (185.234) (170.986) (56.970) 413.190 0Amortization of intangible assets ................................................ (16.153) (130.350) (146.503)Net credit impairments ................................................................ (6.377) (6.377)Profit (loss) before tax 2.774.224 (1.591.405) 1.529 (232.014) 952.334(615.318)337.016Profit for the period ......................................................................................................................................................................................................Income tax expenses ...................................................................................................................................................................................................
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Condensed Consolidated Interim Financial Statements 30 September 2026 14 All amounts are in thousands of ISK Notes to the Condensed Consolidated Interim Financial Statements 6. Operating expenses The table below shows operating expenses as presented in the income statement. The following table shows breakdown of total operating expenses, including Insurance contract operating expenses. Salaries include severance payments made to employees who are not included in the average number of full-time equivalents (FTEs). The 2023 general meeting of the Company authorized the Board of directors to approve a general share option plan in accordance with Article 10 of the Income Tax Act No. 90/2003 for all employees of Skagi and its subsidiaries. 7. Financial assets The table below shows financial assets for each operating segment: YTD 2026 YTD 2025Financial services ...................................................................................................................................................................... 2.035.820 2.130.505Skagi supporting units and eliminations .................................................................................................................................... 303.093 288.466Other cost related to VÍS tryggingar .......................................................................................................................................... 142.869 122.804Total............................................................................................................................................................................................ 2.481.782 2.541.775YTD 2026 YTD 2025Salaries and related expenses .................................................................................................................................................. 4.412.838 4.427.665Other operating expenses ......................................................................................................................................................... 2.360.664 2.277.441Depreciation and amortization ................................................................................................................................................... 490.480 457.634Total............................................................................................................................................................................................ 7.263.981 7.162.740Centralized supporting units and eliminations ........................................................................................................................... 303.093 288.466Operating expenses of financial services .................................................................................................................................. 2.035.820 2.130.505Insurance contract operating expenses ..................................................................................................................................... 4.398.174 4.246.577Operating expenses of the insurance investment portfolio and other insurance cost ............................................................... 380.389 350.690Amortization of intangible assets ............................................................................................................................................... 146.506 146.503Operating expenses, total........................................................................................................................................................... 7.263.981 7.162.740Salaries and related expenses are specified as follows: YTD 2026 YTD 2025Salaries ...................................................................................................................................................................................... 3.367.330 3.362.485Pension fund contributions ........................................................................................................................................................ 511.252 496.293Share option expenses .............................................................................................................................................................. 53.172 79.189Special financial activities tax on salaries .................................................................................................................................. 199.143 212.854Other salary-related expenses .................................................................................................................................................. 281.940 276.845Salaries and salary-related expenses ........................................................................................................................................ 4.412.838 4.427.665Number of fulltime employees ................................................................................................................................................... 235 24430.9.2026Shares in other companiesInsurance investments Financial services TotalListed on domestic stock exchanges ........................................................................................................ 1.851.162 838.479 2.689.641Listed on foreign stock exchanges ............................................................................................................2.260.098 0 2.260.098Other companies ....................................................................................................................................... 7.329.272 62.377 7.391.64911.440.532 900.856 12.341.388Other securitiesGovernment-backed securities, indexed ...................................................................................................3.221.860 327.805 3.549.665Government-backed securities, non-indexed ............................................................................................8.635.278 4.783.464 13.418.742Other bonds ............................................................................................................................................... 16.313.998 564.304 16.878.303Bond funds ................................................................................................................................................ 8.711.294 400.222 9.111.515Institutional investor funds ......................................................................................................................... 2.138.383 0 2.138.38339.020.812 6.075.795 45.096.607Other financial assets111.666 0 111.666Total financial assets ................................................................................................................................. 50.573.011 6.976.651 57.549.662Currency forwards .......................................................................................................................................
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Condensed Consolidated Interim Financial Statements 30 September 2026 15 All amounts are in thousands of ISK Notes to the Condensed Consolidated Interim Financial Statements 7. Financial assets (cont.) 8. Loans to customers a. Credit risk of financial activities The table below shows the claim and book value of financial assets and expected credit losses, in accordance with IFRS 9, by age (number of days past due). b. Loan-to-value The loan‐to‐value ratio (LTV) is the ratio of the gross amount of the loan to the value of the collateral, if any, for the loans to customers of the Bank. Collateral position and the general creditworthiness of a customer are together viewed as the most reliable indicators of credit quality of a loan. Besides collateral included in the LTV ratios the Bank uses other risk mitigation measures, such as guarantees, negative pledge, cross‐collateral and collateralization of non‐quantifiable assets. 31 December 2025Shares in other companiesInsurance investments Financial services TotalListed on domestic stock exchanges ........................................................................................................ 3.797.389 459.228 4.256.618Listed on foreign stock exchanges ............................................................................................................3.518.905 0 3.518.905Other companies ....................................................................................................................................... 8.183.576 57.571 8.241.14615.499.870 516.799 16.016.669Other securitiesGovernment-backed securities, indexed ...................................................................................................2.500.633 307.614 2.808.247Government-backed securities, non-indexed ............................................................................................8.345.277 5.997.752 14.343.028Other bonds ...............................................................................................................................................11.519.128 212.568 11.731.696Bond funds ................................................................................................................................................ 8.320.339 253.174 8.573.513Institutional investor funds .........................................................................................................................2.103.653 0 2.103.65332.789.030 6.771.107 39.560.137Other financial assets312.164 0 312.164Total financial assets ................................................................................................................................. 48.601.064 7.287.906 55.888.970Currency forwards .......................................................................................................................................Nominal Expected Booked30.9.2026value of claim credit losses balance10.865.878 (14.866) 10.851.01161.944 (6.202) 55.742307.808 (29.860) 277.94811.235.630 (50.929) 11.184.701Past due 31-60 days ........................................................................................Past due 61-90 days ........................................................................................Not yet due .......................................................................................................Past due 1-30 days ..........................................................................................Past due >90 days ............................................................................................Nominal Expected Booked31.12.2025value of claim credit losses balance11.853.950 (17.442) 11.836.50811.853.950 (17.442) 11.836.508Past due >90 days ............................................................................................Not yet due .......................................................................................................Past due 1-30 days ..........................................................................................Past due 31-60 days ........................................................................................Past due 61-90 days ........................................................................................
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Condensed Consolidated Interim Financial Statements 30 September 2026 16 All amounts are in thousands of ISK Notes to the Condensed Consolidated Interim Financial Statements 8. Loans to Customers (cont.) The breakdown of loans to customers by LTV is specified as follows: c. Credit quality of loans to customers by credit quality band The following tables show financial assets subject to the impairment requirements of IFRS 9 broken down by credit quality bands where band I denotes the lowest and band IV the highest credit risk. The Bank has primarily used adjusted external credit ratings to assess the default probability of its customers. The Bank’s impairment model uses external credit ratings as one of its main inputs, while LGD is based on internal estimates that take into account management judgement as well as economic outlook. 30.9.2026 % 31.12.2025 %3.759.814 33,6% 3.520.710 30%5.702.768 51,0% 6.055.787 51%1.722.118 15,4% 2.260.012 19%0,0% 0,0%11.184.701 100% 11.836.508 100%91-100% .........................................................................Less than 50% ...............................................................51-70% ...........................................................................71-90% ...........................................................................Total ...............................................................................30.9.2026Loans to customers: Stage 1 Stage 2 Stage 3 Total7.950.983 7.950.9831.843.600 542.111 2.385.711397.533 397.533131.651 131.651369.752 369.75210.192.115 673.762 369.752 11.235.630(10.805) (4.061) (36.063) (50.929)10.181.310 669.701 333.690 11.184.70131.12.2025Loans to customers: Stage 1 Stage 2 Stage 3 Total9.922.861 9.922.8611.163.305 56.381 1.219.687340.165 235.746 575.91110.483 125.009 135.49211.436.813 417.137 11.853.950(11.342) (6.100) (17.442)11.425.472 411.037 11.836.508Non-Rated ......................................................................Credit quality band I .......................................................Credit quality band II ......................................................Credit quality band III .....................................................Credit quality band IV .....................................................In default ........................................................................Book value .....................................................................Gross carrying amount ...................................................Expected credit loss .......................................................Book value .....................................................................Credit quality band I .......................................................Credit quality band II ......................................................Credit quality band III .....................................................Credit quality band IV .....................................................In default ........................................................................Non-Rated ......................................................................Gross carrying amount ...................................................Expected credit loss .......................................................
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Condensed Consolidated Interim Financial Statements 30 September 2026 17 All amounts are in thousands of ISK Notes to the Condensed Consolidated Interim Financial Statements 9. Group entities As of beginning of the year 2026, Skagi has become 100% owner of Íslensk verðbréf, following purchase of 14,1% shareholding from minority shareholders. 10. Investment in associates 11. Insurance contract liabilities Insurance contract liabilities are measured in accordance with IFRS 17 using the Premium Allocation Approach (PAA) and include a risk adjustment for non-financial risk. The line “Run-off and Reassessment of Risk Adjustment” includes the release of risk adjustment for services provided and increases due to updated assumptions. Changes in liabilities for incurred claims are specified as follows: 30.9.2026 31.12.2025VÍS tryggingar hf. ........................................................................100,0%100,0%Fossar fjárfestingarbanki hf. .......................................................100,0%100,0%VF Nord ehf. ...............................................................................100,0%100,0%Skagi ehf. ....................................................................................100,0%100,0%Líftryggingafélag Íslands hf. ........................................................100,0%100,0%Íslensk verðbréf hf. .....................................................................100,0%85,9%Life insuranceAsset and fund managementInvesting activitiesInvesting activitiesInvestment bankingPrincipal activityInsurance operationsBook value Book valueShare 30.9.2026 31.12.202535,0% 175.673 158.37833,3%59.999 53.762235.672 212.140Tplús hf. .....................................................................................................................................................Vex ehf. .....................................................................................................................................................Insurance contract liabilities30.9.2026 31.12.2025Liability for remaining coverage ................................................................................................................................................. 3.169.331 2.758.248Liability for incurred claims ........................................................................................................................................................ 28.754.230 27.573.179Total insurance contract liabilities ..............................................................................................................................................31.923.560 30.331.427Reinsurance contract assetsAssets from reinsurance contracts held .................................................................................................................................... 1.114.718 960.618Insurance contract liabilities, net of reinsuranceInsurance contract liabilities, net of reinsurance ........................................................................................................................30.808.842 29.370.808Liability for incurred claims, start of year ................................................................................................................................... 27.573.179 27.135.658Accounts payable related to incurred claims, start of year ........................................................................................................ (722.158) (909.891)Net liability for incurred claims ................................................................................................................................................... 26.851.021 26.225.766Net finance expenses from insurance contracts due to liability for incurred claims .................................................................. 1.002.812 1.631.525Paid claims in the period due to older years .............................................................................................................................. (8.459.798) (12.057.194)Liability for incurred claims, current year ................................................................................................................................... 9.972.139 11.972.540Total calculated liability for incurred claims ............................................................................................................................... 29.366.175 27.772.637Run off and reassessment of risk adjustment ........................................................................................................................... (1.331.878) (921.617)Accounts payable related to incurred claims ............................................................................................................................. 719.933 722.158Liability for incurred claims, end of period ................................................................................................................................. 28.754.230 27.573.179
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Condensed Consolidated Interim Financial Statements 30 September 2026 18 All amounts are in thousands of ISK Notes to the Condensed Consolidated Interim Financial Statements 12. Financial liabilities Financial liabilities are specified as follows. For a detailed breakdown, refer to notes 12.1 and 12.2. Skagi has a bank credit facility line up to ISK 2,500 million, of which ISK 708 million remains undrawn as of the reporting date. 30.9.2026 31.12.2025Borrowings .................................................................................................................................................................................9.955.246 12.342.900Issued bonds and bills ...............................................................................................................................................................8.230.476 8.610.879Financial liabilities total ..............................................................................................................................................................18.185.722 20.953.77912.1 BorrowingsBorrowings are specified as follows:30.9.2026 31.12.2025Money market deposits .............................................................................................................................................................7.163.347 8.972.015Liabilities to credit institutions ....................................................................................................................................................2.791.899 3.370.884Total ...........................................................................................................................................................................................9.955.246 12.342.90012.2 Issued bonds and billsBalance 30.9.2026Issued bonds and bills Issued Maturity30.9.2026FOS 26 1126 ..............................................................................28.5.202626.11.20261.124.478FOS 27 0309 ..............................................................................9.9.20269.3.20271.210.758FOS 281026 ...............................................................................28.10.202428.10.20261.558.267FOS 040728 ...............................................................................4.7.20254.7.20281.531.605FOS 27 1 ....................................................................................23.12.202523.6.20272.805.3688.230.476Balance 31.12.2025Issued bonds and billsIssuedMaturity31.12.2025FOS 26 0311 .............................................................................. 11.9.2025 11.3.2026 1.023.153FOS 26 0528 ..............................................................................28.11.2025 28.5.2026 908.819FOS 26 1 .................................................................................... 10.7.2024 10.1.2026 783.014FOS 27 1 ....................................................................................23.12.2025 23.6.2027 2.805.907FOS 040728 ...............................................................................4.7.2025 4.7.2028 1.566.220FOS 281026 ...............................................................................28.10.2024 28.10.2026 1.523.7678.610.879Type and terms of interestBond, floating 1M Reibor +1.7% ...........Type and terms of interestBill, discounted ......................................Bill, discounted ......................................Bond, fixed 9.2% ...................................Bill, discounted ......................................Bond, fixed 9.03% .................................Bill, discounted ......................................Bond, floating 1M Reibor +1.5% ...........Bond, floating 1M Reibor +1.7% ...........Bond, fixed 9.03% .................................Bond, fixed 9.2% ...................................
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Condensed Consolidated Interim Financial Statements 30 September 2026 19 All amounts are in thousands of ISK Notes to the Condensed Consolidated Interim Financial Statements 13. Solvency of a financial conglomerate The Financial Supervisory Authority has specified that the Group is a financial conglomerate as defined in Article 3 of Act no. 61/2017 on Supplementary Supervision of Financial Conglomerates. The capital requirement and own funds of the Group is calculated according to method 1 of Act no. 61/2017. As the primary entity in the group is an insurance company, method 1 requires that all assets and liabilities in Skagi, that do not belong to a subsidiary, are included in the solvency calculations of the insurance activities in the computation of the solvency of the conglomerate. The Group calculates the minimum capital requirements for companies that do not fall under the insurance operations using applicable regulations while using the Solvency II framework to calculate own funds and minimum own funds requirements for insurance activities. Solvency is a measure of the Group's ability to absorb shocks, or in other words, an indication of its financial strength. The Group's available capital and capital requirements are calculated on basis that the Group is defined as a financial conglomerate, according to Articles 16, 17 and 18 of Regulation No. 61/2017 on Supplementary Supervision of Financial Conglomerates. The Group's solvency ratio is 1.38 compared to the minimum requirement in the Regulation, which is 1.0 and the internal limit of 1.175. Group solvency ratio is shown before and after assumed dividend as of reporting date in accordance with target dividend payout ratio of 40% of profits and share repurchase program. Own funds30.9.2026 31.12.2025Own funds for insurance activities ............................................................................................................................................. 19.802.629 20.105.530 Own funds for other activities .................................................................................................................................................. 3.423.351 3.288.461Total own funds (before assumed dividend or share repurchase) ............................................................................................ 23.225.980 23.393.991Minimum own fund requirements Own funds requirements for insurance activities ....................................................................................................................... 14.153.038 14.328.365Own fund requirements for other activities ................................................................................................................................ 2.671.800 2.935.881Total minimum own fund requirements ..................................................................................................................................... 16.824.839 17.264.246Solvency30.9.2026 31.12.2025Equity according to the statement of financial position .............................................................................................................. 23.124.602 23.984.235Intangible assets ........................................................................................................................................................................ (4.459.719) (4.558.785)Subordinated bond .................................................................................................................................................................... 4.027.933 3.907.720Assumed dividend plan ............................................................................................................................................................. (471.636) (760.000)Share repurchase program ........................................................................................................................................................ 0 0Other .......................................................................................................................................................................................... 533.164 60.822Calculated own funds ................................................................................................................................................................ 22.754.343 22.633.991Minimum own fund requirements .............................................................................................................................................. 16.824.839 17.264.246Solvency ratio ............................................................................................................................................................................ 1,35 1,31 Solvency ratio (before assumed dividend or share repurchase) ............................................................................................... 1,38 1,36
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Condensed Consolidated Interim Financial Statements 30 September 2026 20 All amounts are in thousands of ISK Notes to the Condensed Consolidated Interim Financial Statements 14. Solvency of insurance activities The minimum solvency is a minimum amount of capital needed to meet the risks faced by insurance activities (VÍS and Lífís). The standardized approach, according to Act No. 100/2016, is applied, whereby calculation is based on all measurable risks. The following tables specify how the solvency requirements are divided into subcomponents of risk. Diversification effects are deducted since it is not assumed that all risks will be realized simultaneously. An adjustment for the loss-absorbing capacity of deferred taxes is deducted upon realization of risks. The solvency ratio of the insurance activities is 1.53 compared to internal limit of 1.35. The solvency ratio of the insurance activities is shown before and after assumed dividend and/or share repurchase to Skagi parent company. During the third quarter of 2026, share repurchases of ISK 600 million, recognized in the first quarter, were reversed and reclassified as receivables from Skagi. This has consequently increased own funds before assumed distributions to shareholders by ISK 600 million. Solvency capital requirements30.9.2026 31.12.2025Base Solvency capital requirement (BSCR) .............................................................................................................................. 15.465.389 15.714.987Operational risk ......................................................................................................................................................................... 1.165.802 1.127.280Adjustment due to deferred taxes ............................................................................................................................................. (2.494.679) (2.526.170)Total minimum solvency ............................................................................................................................................................ 14.136.512 14.316.097Base Solvency capital requirement (BSCR)30.9.2026 31.12.2025Market risk ................................................................................................................................................................................. 7.784.647 9.246.964Counterparty risk ...................................................................................................................................................................... 2.344.361 1.902.212Life underwriting risk .................................................................................................................................................................. 195.683 184.216Health underwriting risk ............................................................................................................................................................. 2.251.494 1.951.091Non-life underwriting risk ........................................................................................................................................................... 9.370.012 8.727.296Diversification effects and other factors .................................................................................................................................... (6.480.809) (6.296.792)Total BSCR ................................................................................................................................................................................ 15.465.389 15.714.987Market riskInterest rate risk ......................................................................................................................................................................... 243.876 700.832Equity risk .................................................................................................................................................................................. 6.174.363 8.077.662Property risk ............................................................................................................................................................................... 213.568 268.610Spread risk ................................................................................................................................................................................ 1.473.697 1.037.481Foreign currency risk ................................................................................................................................................................. 848.951 396.282Concentration risk ...................................................................................................................................................................... 313.668 599.090Diversification effects ................................................................................................................................................................. (1.483.475) (1.832.994)Total market risk ........................................................................................................................................................................ 7.784.647 9.246.964SolvencyMinimum own fund requirements ..............................................................................................................................................14.136.51214.316.097Calculated own funds (before assumed distributions to shareholders) ..................................................................................... 23.389.352 21.794.430Solvency ratio (before assumed distributions to shareholders) ................................................................................................. 1,65 1,52 Calculated own funds (after assumed distributions to shareholders) ........................................................................................ 21.649.913 20.594.430Solvency ratio (after assumed distributions to shareholders) .................................................................................................... 1,53 1,44
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Condensed Consolidated Interim Financial Statements 30 September 2026 21 All amounts are in thousands of ISK Notes to the Condensed Consolidated Interim Financial Statements 15. Fossar capital adequacy ratio The capital adequacy ratio of Fossar is calculated in accordance with Act No. 161/2002 on Financial Undertakings. The capital requirement due to credit, market, and operational risk is calculated using the standardized method and the bank's capital adequacy ratio is 25.8%. The minimum required capital ratio of credit undertakings is 8% according to Article 84 of the Act No. 161/2002 on Financial Undertakings. In addition to the minimum required capital base, the Bank must maintain certain capital buffers, specified by the Financial Supervisory Authority of the Central Bank of Iceland. Minimum capital requirement is based on the Bank's Internal Capital Adequacy Assessment Process (ICAAP) and is reviewed by the FSA through the Supervisory Review and Evaluation Process (SREP). Minimum regulatory capital requirements, including additional capital buffers, is 21.4% according to the most recent Supervisory Review and Evaluation Process. 16. Events after the reporting date No events have occurred after the end of the reporting period that require the Group to change these financial statements. 30.9.2026 31.12.2025Fossar total equity at period end ............................................................................................................................................... 3.205.740 3.182.493Deduction items .........................................................................................................................................................................(217.286) (236.870)Own funds ................................................................................................................................................................................. 2.988.453 2.945.623Risk weighted exposures:Credit risk .................................................................................................................................................................................. 5.729.670 6.880.546Market risk ................................................................................................................................................................................. 2.938.329 2.478.240Operational risk ......................................................................................................................................................................... 2.918.189 2.918.189Total risk exposure amount ....................................................................................................................................................... 11.586.188 12.276.974Capital adequacy ratio for Fossar ..............................................................................................................................................25,8% 24,0%
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Condensed Consolidated Interim Financial Statements 30 September 2026 22 All amounts are in thousands of ISK Notes to the Condensed Consolidated Interim Financial Statements 17. Quarterly statement and key ratios Q3 2026 Q2 2026 Q1 2026 Q4 2025 Q3 2025Insurance revenue ...................................................................... 9.042.331 8.426.106 8.047.872 8.204.617 8.368.737 Net interest income ..................................................................... 139.654 131.128 153.949 137.845 122.830 Net fee and commission income ................................................ 445.628 518.423 532.842 686.128 479.882 Net financial income ................................................................... (343.264) (207.722) (284.151) 1.520.760 (246.090)Share in profit of associates, after income tax ........................... 0 6.341 17.295 59.500 0 Other income .............................................................................. 44.026 87.408 33.200 47.127 39.903 Total income ............................................................................... 9.328.375 8.961.683 8.501.007 10.655.977 8.765.262 Insurance service expenses ....................................................... (7.144.620) (6.809.342) (7.669.969) (7.985.855) (6.590.384)Net expenses from reinsurance contracts .................................. (167.080) (170.484) (239.903) (168.842) (307.324)Operating expenses ................................................................... (717.782) (890.350) (873.650) (966.460) (759.438)Amortization of intangible assets ................................................ (47.850) (49.317) (49.339) (49.802) (49.170)Net credit impairments ................................................................ (26.806) (5.248) (1.433) (249) (2.309)Profit (loss) before income taxes ................................................ 1.224.236 1.036.943 (333.287) 1.484.768 1.056.638 Income tax .................................................................................. (412.245) (306.222) (2.406) 80.681 (339.241)Profit (loss) for the period ...........................................................811.991 730.721 (335.693) 1.565.449 717.397 Insurance operationsClaims ratio ................................................................................. 64,1% 62,8% 76,2% 78,6% 62,6%Net reinsurance ratio .................................................................. 1,8% 2,0% 3,0% 2,1% 3,7%Claims and net reinsurance ratio ................................................ 66,0% 64,8% 79,2% 80,7% 66,3%Insurance contracts expense ratio .............................................. 14,9% 18,0% 19,1% 18,7% 16,1%Combined ratio ...........................................................................80,9% 82,8% 98,3% 99,4% 82,4%Investment OperationsInsurance investment portfolio return ......................................... 0,5% 0,8% 0,7% 4,0% 0,9%Financial servicesFinancial Services income (excl. interco adj.) ISKm .................. 581 666 714 976 700Assets under Management (AuM) ISKbn ................................... 245 251 251 253 236GroupROE on annual basis 14,2%12,9%-5,7% 27,2% 13,2%Profit per share0,43 0,39-0,180,820,38