The contents of an email sent by Kaupthing CEO, Finnur Sveinbjornsson to the bank’s employees have been published by Pressan.is

Kaupthing’s management does not believe that the solutions on offer by the government to aid households in debt are going to work. The bank is working on its own solutions which it intends to introduce to ministers during the week.

“The government has repeatedly said that it does not intend to lower the debts of Icelandic households with a percentage cut. It is still plain to see for everyone that the solutions that it has offered are not going to be enough or are too unclear to work efficiently. That is why the retail banking department has been looking for new ways.”, says Finnur.

Kaupthing is also working on assembling a group that deals with problems that don’t belong to the bank’s largest clients. Different solutions must be provided for different sectors.

“It is obvious that more and more homes and businesses are sinking deeper into debt. To meet their problems different solutions must be provided to different sectors, and ways must be developed for the branches to deal with those problems. A special tema will be formed in the retail banking department which will develop solutions and support the branches. The bank is also attempting to display that it has the ability to deal with the massive problems ahead in the next months and years”.

The email was sent out yesterday to inform the employees about what the management of the bank is working on, especially negotiatons between the state and the committee overseeing the old bank with its creditors.

Finnur expects the negotiations to be about the estimates of Deloitte and Oliver Wyman on one hand and the management’s estimates on the other.

About how the bank is dealing with the financial and operational restructuring of businesses in over their head Finnur says, “For your information, some local and foreign parties have doubted that the bank ( as well as Islandsbanki and Landsbankinn) are able to deal with this because of the scope of the problem.”

The restructuring taking place in the financial sector right now are probably the biggest ones since four banks merged into Islandsbanki in 1990.

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