<strong>Dancing around the golden calf</strong>

The inhabitants of this country have in recent months and years faced unprecedented times and circumstances. A global pandemic struck with harsh consequences for the nations of the world, where families, households, and businesses are still dealing with the aftermath.

 Following that, a war emerged in Europe, something most of us believed to be a thing of the past and nearly unimaginable that such an event could repeat itself. I therefore find it appropriate, in light of this, to appeal to the conscience of banks and insurance companies who, through their actions and policies, can have a significant impact on the living standards of people in the country.

Wage negotiations

Wage negotiations are ahead, and it is likely that they will be quite tough. According to the pricing surveillance of ASÍ, the increase in expenses for a family of four in their own home has amounted to up to 128,607 crowns per month if based on their expenses from the previous year. These are significantly, significantly high numbers, and to float Icelandic families through the current situation requires more than government interventions. Here, everyone needs to look within themselves and consider what can be done to bring the entire community to the place we want to be. Then I believe it is right to particularly look to those who are often called the broad shoulders in everyday conversations.

Premiums have increased…

Insurance company premiums have increased significantly in recent years while insurance companies sit on billions in compensation funds. The responsibility of insurance companies for the home accounts of Icelandic households is great. In my conversations with people, I have heard that it is not unusual for families to pay between 40-55 thousand crowns per month for life, car, and home insurances. Everyone who wants to see can see that these are considerable amounts when put in the context of other expenses that the average family needs to pay. Then I specifically highlight families with children who, in addition to paying mortgage or rent, also need to pay daycare fees, food costs in schools, sports practices, etc. It cannot be that as a society we aim to ensure that insurance is only within the reach of the wealthier.

…And the banks are delivering significant profits

In October, Landsbankinn, Arion Bank, and Íslandsbanki released their financial statements for the first nine months of the year. It emerged that their combined profit during the period was 50.2 billion crowns. It can be said with irony that this is indeed less profit than the year before, but profitability is above target for all except Landsbankinn, which still stands quite well.

In this context, it is pleasing to mention that the Minister for Culture and Trade has appointed a working group to analyse the fees and profitability of commercial banks. The purpose of this work is to examine the role of service and interest fees, interest margins, and other fees from customers in the profitability of the banks. The goal is to see in black and white whether Icelandic households pay more for general banking services than other households in the Nordic countries. I have high hopes for this work because if we are to increase the country's competitiveness, then the operation of homes in the country must be competitive.

Finally, it is perhaps better that these prosperous companies would ride the wave with the public in the country rather than dance around the golden calf.

Ágúst Bjarni Garðarsson, MP for Framsókn and first deputy chairman of the economic and trade committee.

The article was first published on visir.is on 10 November 2022.