Iceland's Kvika Bank has agreed to a 20 million króna settlement with the Financial Supervisory Authority for serious reporting failures. The bank did not submit a mandatory TSR II report for 73,792 transactions over nearly 14 months, from December 2022 to February 2024.
In a settlement published on the regulator's website, Kvika expressed its willingness to resolve the matter in a letter dated February 7, 2025. The Financial Supervisory Authority's committee considered the case fully informed on October 30, 2025, and approved the settlement with the 20 million króna fine paid to the state treasury.
The Scale of the Regulatory Failure
The violation concerns the Markets in Financial Instruments Regulation (MiFIR). The missing TSR II data covers a significant period and volume of trades. This type of reporting is crucial for market surveillance. The regulator stated the data is used to detect insider trading and market abuse, thereby strengthening trust in the securities market.
Determining the fine involved assessing the seriousness of Kvika's breach. The authority focused on the purpose of the MiFIR reporting obligation. It noted the failure involved a large volume of supervisory data—the 73,792 unreported transactions—over a long timeframe.
A Settlement Built on Compliance
The path to settlement began with Kvika's formal expression of willingness to cooperate. The subsequent review by the Financial Supervisory Authority's committee confirmed all necessary information was available. This allowed for a resolution without protracted legal proceedings. The payment to the state treasury concludes the administrative penalty phase.
In its reasoning, the regulator emphasized principles of deterrence, efficiency, and proportionality when setting the fine amount. The 20 million króna penalty reflects these considerations against the scale of the reporting lapse. The settlement document serves as the full public record of the decision.
The Critical Role of Transaction Reporting
The case highlights the backbone of modern financial oversight. TSR II reports are not mere bureaucracy. They provide regulators with a near-real-time map of trading activity. This map is essential for spotting illegal patterns like insider trading before they distort markets.
For nearly 14 months, a segment of Kvika's trading was invisible to supervisors. This gap represents a blind spot in Iceland's financial market monitoring. The regulator's statement directly links accurate reporting to market credibility and investor trust, which are paramount for a small, active market like Iceland's.
Context in Iceland's Financial Landscape
Iceland's financial sector operates under intense scrutiny following the 2008 crisis. Robust transparency and reporting are non-negotiable pillars of the post-crisis regulatory framework. This settlement reinforces that the technical duty of data submission is a fundamental compliance requirement.
While a settlement implies cooperation, the fine signifies a substantive failure. The volume of missed transactions—73,792—suggests a systemic reporting breakdown, not isolated errors. For a bank, such a lapse in internal controls concerning market-facing activities is a serious operational finding.