Landsbankinn hf. was established on 7 October 2008. The founding of its predecessor dates back to 1886. Landsbankinn is based on the domestic operations of Old Landsbanki Íslands hf.

Initial balance sheet

The Bank's initial balance sheet was introduced in December 2009; at the same time, a settlement was negotiated between Landsbankinn (NBI hf., now Landsbankinn hf.) and Landsbanki Íslands hf. (now LBI hf.).

Under the terms of the settlement agreement, the National Treasury of Iceland acquired an 81.3% share in the Bank and Landskil ehf., a subsidiary of Landsbanki Íslands hf., 18.67%. Total issued share capital amounted to ISK 24 billion.

Ownership of Landsbankinn changed as of 11 April 2013. The 18.67% share held by Landskil on behalf of the Winding-up Board of LBI hf. was transferred to the Icelandic State and 2% of shares came to Landsbankinn hf. in accordance with the agreement from 2009. The holding transferred to Landsbankinn was intended for disbursement among the Bank's employees. On 30 September 2013, part of that asset was assigned to around 1400 current and former Landsbankinn employees.

On 29 March 2015, the Icelandic Financial Supervisory Authority (FME) issued a decision providing for the merger of Landsbankinn and the savings bank Sparisjóður Vestmanneyja and on 4 September 2015 the merger of Landsbankinn with another savings bank, Sparisjóður Norðurlands, was approved.

As a result of these mergers, the former guarantee capital owners of the savings banks received shares in Landsbankinn, including the Treasury, which held a major portion of the savings banks' guarantee capital. Former guarantee capital owners other than the Icelandic state thereby acquired holdings equivalent to around 0.11% of Landsbankinn's share capital.