Finance is responsible for funding and treasury and the division also oversees the Bank’s financial results, those of several of its subsidiaries and the financial results on a group level. Finance is also responsible for reporting to management and regulators in accordance with the relevant legal and regulatory framework. Finance also handles the Bank’s proprietary trading. Finance had 54 employees at the end of 2014. Finance is managed by Stefán Pétursson, Chief Financial Officer.
Finance is split into five departments.
Planning and Analysis is responsible for budgeting and analysis and is also responsible for reporting to the management and regulators, particularly the FME and the Central Bank of Iceland.
Funding is responsible for short-term and long-term funding on the domestic and international markets. The department also liaises with Icelandic and international ratings agency.
Treasury is responsible for liquidity and interest rate management at the Bank. It also handles the internal pricing of interest rates, foreign currency and derivatives.
Proprietary Trading reports directly to the Chief Financial Officer and the department is responsible for market making and position taking in listed Icelandic securities.
Accounting is the largest department within Finance and is responsible for producing the Bank’s financial statements. Accounting is divided into three further units. Parent Company Accounting is responsible for accounting and preparing the financial statements of the parent company and several smaller subsidiaries, as well as settling and reconciling banks accounts, loans, deposits and borrowings. Cost Accounting records entries into the accounts and payments linked to the Bank's operating and salary expenses. Finally, Fund and Entities Accounting is responsible for the accounting of UCITS managed by Stefnir hf. and pension funds managed by Arion Bank Asset Management.
Corporate development and marketing
Corporate Development & Marketing plays an important role in the Bank's strategic planning, motivating and supporting change and development within the Bank. The division is divided into Marketing, Online Banking, Project Office and A Plus. The division employed 32 people at the end of the year. The managing director is Rakel Óttarsdóttir.
The role of Marketing is to support the development of long-term relationships with the Bank’s customers through focused marketing and effective communications. Marketing is integral to the Bank’s strategy and future vision and involves marketing products and services, event management, internal marketing and corporate social responsibility, while at the same time nurturing the Bank’s image and brand.
Online Banking is responsible for developing digital channels, services and communications with the Bank’s customers. By continuously offering new options online, via Arion Online Bank and the Arion App, the Bank is offering its customers greater choice and the option to access banking services whenever and wherever they want. Online Banking is also managing the introduction of CRM which brings greater efficiency and better customer service.
Project Office manages the Bank’s project pipeline. The Project Office has a team of professional project managers who manage major cross-bank projects, in line with the Bank’s strategy and future vision. Effective project management ensures greater efficiency and facilitates the engagement of everyone involved.
A Plus manages the implementation of lean management across the Bank with the objective of better banking for customers. A Plus helps us to continuously improve and to find new ways of helping our customers to reach their goals. By the end of 2014 70% of employees had gone through the implementation of lean management.
The Operations division supports the Bank by ensuring that all employees can apply their abilities to the full for the benefit of customers. The division comprises Information Technology, Back Office, Human Resources, Facilities and Property Management and Records Management, while the Head of Procurement also belongs to the division. Operations had 256 employees in 246 full-time equivalent positions at the end of 2014. The managing director is Sigurjón Pálsson.
Information Technology (IT) advises and provides the Bank with solutions on IT issues. The strength of IT lies in its flexible systems with clear goals and ensuring that employees have straightforward access to the correct information. The underlying goal is to provide support to employees and enable them to enhance the customers’ experience.
IT divides its activities into two main areas. The production side where IT is involved in selecting new solutions to integrate into the Bank's existing systems and to introduce or design new solutions, while integrating innovations, adding to and fixing systems already in place. Then there is the operational side which involves installing, managing and monitoring the Bank’s hardware and systems. Information security is integral to all of IT's activities, whether on the production or operational side.
The focuses in 2014 were to define and simplify the schematics, monitor systems and spread the workload across the employees more evenly.
In 2015 an even greater emphasis will be placed on projects designed to improve the customers' experience. Work to simplify the schematics will continue in an effort to boost efficiency and to benefit the customer.
The Information Technology division is divided into the following departments: Front End Solutions, Business Intelligence and Data Warehouse, Technical Service and Service Management. The Head of IT is Hákonía Jóhanna Gudmundsdóttir.
Back Office is responsible for administrating and processing front office transactions. This includes ensuring compliance with the rules on completing documents and the correct recording of data in the Bank’s systems. Specialists in Back Office advise the front office and are in direct contact with domestic and international financial institutions and, to a growing extent, individual customers of the Bank.
The division’s main tasks are to administer all the Bank's deposit accounts, buy loans and monitor bonds until maturity. Back Office is also responsible for payment distribution plans, performing international payments and guarantees and the clearing and settlement of all securities transactions. Back Office is also responsible for the Bank’s reserves of notes and coins and handles the custody of all securities for the Bank and its customers. Back Office is divided into seven departments: Foreign Payments and Trade Finance, Primary Processing, Payment Services, Data Quality, Loans, Securities, and Cash Centre. The Head of Back Office is Einar Már Hjartarson.
The main focuses in 2014 were to speed up processing times, improve efficiency and strengthen direct links with the customer by shortening lines of communication. Lean management was introduced throughout the division in 2014 and this will help Back Office reach its targets in 2015.
The Bank’s most important asset is its employees and it is the role of Human Resources to implement the Bank's HR strategy and help the employees develop. There was a strong focus on human resources in 2014 and tasks included the application for equal salaries certification at the Bank. The activities and tasks undertaken by the department are discussed in more detail in the separate chapter on Human Resources. The Head of Human Resources is Jónas Hvannberg and there were nine full-time employees at the end of 2014.
Facilities and Property Management
The objective of Facilities and Property Management is to ensure that all customer areas are suitable and that all employees have a good working environment which supports what they do. Catering runs the canteen and café and is responsible for food and refreshments at all events organized by the Bank. Printing and Mailroom Service and Courier Service belong to the division. Property Management manages and maintains all premises used by the Bank across the country, a total of 30,000 m2, and is responsible for the security of the Bank’s places of work. The Head of Facilities and Property Management is Gunnar Jóakimsson.
Records Management serves all divisions of the Bank and supervises and manages the organization of records, both in electronic and physical format. Records Management is also responsible for the Bank's library and databases. The goal of Records Management is to ensure that documents are accessible when needed and that they are not misplaced, lost or end up in the wrong hands. The aim is also to ensure that unnecessary paper or information, in any form, does not accumulate in offices or in storage and to prevent the untimely destruction of documents. The Head of Records Management is Svava Halldóra Fridgeirsdóttir.
The main task in 2014 was the implementation of a new records management system and this will continue in 2015.
A clear strategy on procurement management brings greater efficiency to the business. Effective procurement management strengthens the Bank's relationship with suppliers and ensures the optimum terms of business, both saving money and avoiding future costs.
In the Bank’s new procurement strategy the Head of Procurement is defined as a centralized adviser to the Bank’s business segments when dealing with suppliers. This ensures that the Head of Procurement has a clear overview of the Bank's relationships and current business agreements with the Bank's suppliers. This arrangement proved most effective in 2014. The Head of Procurement is Jón Gunnar Björnsson.
The role of the Legal division is to provide independent legal advice. The Legal division strives to foster good relationships with other divisions of the Bank in order to ensure that legal experts are involved in any issues requiring legal advice at an early stage. The division is organized into teams to guarantee that the knowledge and experience of each employee is used to the full and that information is transmitted effectively. The Legal division had 45 employees at the end of 2014.The managing director is Jónína S. Lárusdóttir.
The Legal division is divided into four units.
Enforcement and Collection handles the satisfaction of the claims owed to Arion Bank and other entities under special agreements. It is also responsible for representing the Bank in court.
Legal Services provides legal advice to different divisions and departments within the Bank. There are three teams within Legal Services, specializing in legal advice for different departments or units within the Bank.
Legal and Documentation provides legal advice and drafts legal documents for Retail Banking and Corporate Banking. There are two teams: one which specializes in legal advice and drafting for individual customers and the other for corporate clients. This team also provides other legal services for the credit divisions. The department also attends to issues relating to the capital controls.
Administration is responsible for the general administration of the division and provides support to its employees.
The CEO’s Office includes the CEO, personal assistants to the CEO, a business development specialist, head of innovation and the Customers' Ombudsman. Communications and Compliance also form part of the CEO’s Office. The CEO’s Office had 16 employees at the end of 2014.
The main tasks of the CEO's Office involve general assistance to the CEO and the organization and administration of board and committee meetings. Business development is responsible for development and short-term and long-term strategic planning. Innovation supervises projects including Startup Reykjavík, Startup Energy Reykjavík and Startup Arion, which is an in-house business accelerator. The Customers’ Ombudsman is responsible for analyzing and following up on recovery cases involving retail and corporate customers.
Communications is responsible for public relations and external and internal communications.
The role of Compliance is to ensure that operations are in compliance with the law and anti-money laundering and terrorist financing measures. Compliance is discussed in more detail here.