Arion Bank aligns lending to help Iceland achieve sustainability goals, empower women as investors

Arion Bank is building on its reputation as a pioneer in sustainable financing — one that carries hard-won lessons of Iceland’s past into the immense opportunities of the Arctic.

The company’s journey is a story of reinvention, inclusivity, and sustainable growth, placing it at the forefront of financing in Iceland and across the region.

At a time when global capital seeks stable, transparent, and responsible partners, CEO Benedikt Gíslason is positioning Arion Bank as a key market participant in Iceland and a reliable financial partner for the rapidly developing Arctic economy.

“Arion Bank’s sustainability strategy closely aligns with Iceland’s government goal of achieving climate neutrality by 2040,” Gíslason said in an interview. “The bank has calculated its financed emissions and is setting targets for different industries.”

He emphasized that the business strategy goes “hand in hand” with the Icelandic government’s climate objectives, including a sustainable financing framework and green lending options.

Arion Bank aims to have 20% of its lending portfolio comprised of sustainable investments, in line with its market-leading sustainable financing framework, by 2030, up from 15.5% now.

“Our role is not just being profitable,” Gíslason said. “We seek to actively contribute to societal progress through sustainable and responsible financial strategies,” in Iceland and the Arctic.

Arion Bank has developed an “exclusion list” prohibiting lending and investments in industries including oil exploration and production, which mirrors the government’s strategy. Even if significant reserves of oil or gas were found in Iceland, the bank wouldn’t finance the extraction, he said.

Building trust one relationship at a time

Arion Bank’s story, like Iceland’s, is one of fire and ice. Its roots trace back to the 1800s, originating as an early savings bank. A key predecessor was the Agriculture Bank, founded in 1930 as a financial institution.

In 2008, Iceland’s banking sector — once a symbol of aggressive expansion —became engulfed in a global financial crisis. Among the institutions consumed in the conflagration was Iceland’s largest lender, Arion Bank’s predecessor.

The country responded with a strategy as fierce as its landscapes: a decisive restructuring of its financial system focused on domestic market needs, accountability, and trust.

Since its establishment in late 2008, Arion Bank has avoided chasing quick returns and has devoted itself to serving Icelanders and building trust one relationship at a time. Over the next decade, it evolved carefully and deliberately, emerging today as one of Iceland’s strongest, most trusted financial institutions.

“From being an underdeveloped nation, Iceland transformed into an affluent economy with strong social infrastructure, high GDP per capita, and sustainable practices,” Gíslason said. “The bank has been instrumental in supporting development, particularly in sectors including sustainable fisheries, eco-friendly tourism, and knowledge-based industries.”

Arion Bank’s historical experience in supporting Iceland’s economic growth now informs its strategy of supporting similar development in neighboring countries of the Arctic.

The company’s efforts are winning recognition.

Arion Bank was named Bank of the Year 2024 in Iceland by both Euromoney and The Banker. Additionally, in its annual ranking of the world’s best investment banks for 2025, Global Finance named Arion Bank as the best in Iceland. And it recently gained an updated ESG risk rating from Morningstar Sustainalytics, which rates Arion Bank as one of the best-performing banks globally.

Arion Bank is top rated both in the banking industry as well as within regional banks, earning top badges in both categories, in the top 8% of more than 1,000 banks rated by Morningstar Sustainalytics worldwide, and in the top 4% of almost 600 regional banks. It also ranks in the top 6% of the approximately 15,000 companies rated by the ratings agency.

MSCI also concludes that Arion Bank is a leader, positioning the bank in category AA with a score of 8.4 (on a scale of 1–10). A score of 8.4 is in the upper range of AA and only 0.18 points away from reaching AAA.

Iceland’s IPO Leader, the Arctic’s Financier-in-Waiting

Today, Arion Bank is the leader in managing Initial Public Offerings in Iceland, and a growing presence across the Arctic.

Among the many companies that have successfully entered the public markets with Arion Bank’s support are:

Marel: A leading global provider of advanced food processing equipment. Arion Bank played a major role in supporting Marel’s complex public offerings and follow-on listings, which helped expand its access to international investors. Arion Bank also advised LBT on its acquisition of Marel in 2024.

Iceland Seafood International: Arion Bank served as lead advisor and arranger when ISI listed on Nasdaq Iceland, helping the seafood exporter secure growth capital for European expansion. Arion Bank also managed the ISK 3.4 billion ISI bond offering in 2021, the first unsecured corporate offering in over a decade.

Hampiðjan: Arion Bank acted as the manager of the IPO for the leading developer of servicing products for the fisheries and aquaculture industries, as well as the listing of the company’s shares on the Nasdaq Iceland exchange.

Through these and other transactions, Arion Bank not only raises capital for Icelandic businesses but also strengthens Iceland’s reputation for well-regulated, transparent capital markets—a key factor as attention turns to Arctic economic development.

Building on its strength at home, Arion Bank has positioned itself as a trusted provider of IPO and advisory services to businesses across Greenland, Northern Norway, and Arctic Canada — mainly supporting the fisheries industries.

Arion Bank is also positioning itself to support future development, particularly in sustainable energy.

“There is significant potential for energy projects in Greenland,” and Iceland has extensive experience in hydro and geothermal that could be valuable, Gíslason said.

Empowering a New Generation of Investors

A defining feature of Arion Bank’s philosophy is financial democratization.

Despite Iceland’s global leadership in gender equality, a persistent gap remains in investment activity and asset ownership between men and women. Research continues to show that Icelandic women invest less frequently and have lower risk appetite than their male counterparts, patterns that carry long-term consequences for individual financial security and systemic wealth distribution.

To address this imbalance, Arion Bank launched Women Invest, a strategic initiative aimed at closing the gender investment gap through education, community-building, and targeted market campaign. The initiative has quickly become one of the bank’s most high-impact ESG efforts, aligning with both its financial inclusion goals and broader economic sustainability metrics.

A Strategy to Strengthen Female Financial Participation

Women Invest delivers financial literacy and investment education through nationwide events and accessible online platforms. The program includes a series of seminars, workshops, and networking events, offering insights on savings, pensions, equity markets, and long-term portfolio strategies. Attendees are given access to seasoned financial professionals, market analysts, and prominent female investors.

Since its launch just over a year ago, Women Invest has hosted 76 fully booked events across Iceland, drawing over 6,800 participants – a clear signal of demand and engagement in a previously underserved demographic.

“As part of our strategic focus on improving the financial health of our clients, we view financial empowerment as essential to economic equality,” said Gíslason. “Women Invest is not simply an educational campaign; it’s a catalyst for systemic change in how women engage with financial  markets and contribute to the economy as active investors.”

Key Initiatives Under the Women Invest Banner Include:

• The Women’s Investment Forum – A recurring, nationwide series of practical investment workshops featuring keynote speakers, group discussions, and networking opportunities. These events are hosted both independently and in collaboration with women’s advocacy groups.
• Women’s Entrepreneurship Programs – Tailored courses for female founders and aspiring entrepreneurs, focusing on business planning, capital raising, and readiness for venture funding.
• Targeted Financial Content – Arion Bank has launched Iceland’s first gender-specific online financial knowledge hub, providing accessible content on investment strategies, personal finance, and profiles of female role models in diverse sectors.

Tangible Gains in Asset Growth and Market Activity

Early results from Women Invest suggest a strong correlation between participation and increased financial engagement. Arion Bank reports:

• +8.5% growth in assets held in custody accounts by women
• +19% increase in mutual fund subscriptions by female clients
• +18.4% rise in mutual fund investment holdings among women aged 20–69

These metrics not only underscore the program’s effectiveness but also illustrate how inclusive financial strategies can drive asset growth within key customer segments.

A Scalable Blueprint for Inclusive Growth

Arion Bank positions Women Invest as a long-term strategic initiative, with future plans to expand financial education offerings to other underserved populations, including younger Icelanders. By reducing entry barriers and reshaping perceptions around investing, the bank is fostering a more inclusive investment culture across the country.

Through Women Invest, Arion Bank is not only advancing its ESG and DEI goals but also unlocking new avenues for customer engagement and sustainable growth in the Icelandic financial sector.

Financial Strength and Strategic Vision

Arion Bank’s bold ambitions are underpinned by rock-solid financial health (2024):

• Net Earnings: ISK 26.1 billion
• Return on Equity (ROE): 13.2%
• Cost-to-Income Ratio: Under 45%
• Dividend Payout: 61% of profits, reflecting confidence and discipline

In September, The European Investment Fund signed a guarantee agreement with Arion Bank to support Icelandic small and medium-sized businesses. With backing from the InvestEU program of the European Commission, the EIF-guarantee will enable Arion to award up to €100 million in new lending to local companies on favorable conditions in three fields: sustainability investments; lending for innovation and digitalization; and Iceland’s blossoming film industry and creative sector.

Arion Bank’s journey offers a profound lesson: resilience breeds opportunity, and trust becomes a foundation for growth.

Through its extensive IPO financing, its commitment to empowering women, and its vision for a sustainable Arctic economy, Arion Bank is shaping a financial future that is inclusive, innovative, and global.

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