We are not pro­ceed­ing with the an­nounced fee in­creases and will seek to keep in­creases be­low 2.5%

On 23 July, we announced increases to various items in Arion Bank’s list of fees and charges that were due to take effect two months later, on 23 September. These related to fees that had not been increased for many years, including services for which the Bank relies on external providers, such as distribution companies that had raised their charges by more than the Bank had raised its own fees. These announced changes to fees and charges have not been implemented.

Given the urgent importance of reaching a broad societal consensus on bringing down inflation and avoiding the activation of the termination clauses in collective wage agreements on 8 October, Arion Bank has decided to postpone the implementation of these increases. Similar increases to the Bank’s list of fees and charges for corporate services were due to take effect at the beginning of October, but these will also be postponed. Furthermore, we will seek to keep general increases to the Bank’s list of fees and charges for retail customers below 2.5% over the coming year.

The overall increase in Arion Bank’s general list of fees and charges for retail customers has been approximately 7.5% since 2022. Over the same period, consumer prices have risen by 34.6%, meaning the real value of our list of fees and charges has declined by around 20% since 2022. At the same time, a number of service fees have been abolished and foreign exchange mark-ups on card transactions have been reduced. Services that are available both in our branches and through the Arion app or online banking are, in many cases, free of charge when customers carry them out themselves through digital channels. In addition, our card fees have risen by only 19% during this period, representing a real-term decrease of just over 11%.

As regards Arion Bank’s subsidiaries, it is worth noting that in recent years Stefnir has placed particular emphasis on making investing more accessible to individuals and households. Front-end fees have been eliminated, minimum investment amounts and transaction fees for purchases and sales have been removed, and management fees on numerous funds have been reduced. While savings products of this kind are not part of households’ day-to-day consumption, they are nevertheless important in the broader context.

Vörður has not introduced any general price increases for retail customers since 2024, nor are any such increases planned. Insurance premiums are largely driven by changes to the general price level, as claims costs tend to follow the same trend. Despite this, the average total premium for private motor insurance at Vörður, which is often the largest insurance expense for households, has increased by 9% since 2024, while the Consumer Price Index has risen by 14% over the same period.

Insurance and financial services currently account for 1.23% of the Consumer Price Index.

Over the past year, we at Arion Bank have published a number of articles exploring ways to lower interest rates in Iceland and reduce the impact of inflation and indexation. The primary purpose of these articles is to encourage informed discussion about the financial system, inflation and interest rates over the longer term. We believe it is important that as many stakeholders as possible take part in this discussion, not least pension funds, public authorities and labour market participants.