Kaupthing

Kaupthing Bank hf., commonly known as Kaupthing, was an Icelandic financial services group based in Reykjavík. Founded in 1982, it grew to become one of Iceland’s largest banks, offering retail and private banking, corporate and investment banking, asset management, and related financial services. The group expanded internationally, operating subsidiaries in the United Kingdom and other European markets, and providing investment banking and fund services through its network of offices and affiliates.

In the run-up to the global financial crisis, Kaupthing expanded rapidly but faced mounting liquidity and funding pressures as credit markets seized up. During the Icelandic financial crisis of 2008, the bank suffered severe distress and the Icelandic authorities moved to place Kaupthing into resolution and state control. In October 2008, Kaupthing Bank plc in the United Kingdom and other international subsidiaries were placed into administration as part of the broader restructuring of Iceland’s banking sector.

The resolution process separated viable assets and operations from distressed liabilities. The Icelandic authorities reorganized the banking sector, with the aim of preserving essential financial service functions while winding down insolvent elements. Over the following years, Kaupthing’s assets and operations were either restructured into successor institutions or liquidated. The collapse of Kaupthing, along with Iceland’s other major banks, contributed to a severe economic downturn in Iceland and prompted ongoing debates about banking regulation and financial stability.

See also: Icelandic financial crisis, Glitnir, Landsbanki.