Icelandic bank Landsbanki, one of the frontrunners in the race to buy Irish Nationwide Building Society, posted a 61 per cent rise in its third-quarter profits yesterday and reiterated its plans to continue its aggressive expansion overseas. Simon Carswell, Finance Correspondent

The bank said that 48 per cent of its revenues came from its overseas operations.

The Icelandic bank has been expanding outside its own country in an effort to diversify revenue and broaden its client base.

Landsbanki already owns Merrion Capital, which it acquired for €55.3 million in 2005, and it has carried out due diligence on Irish Nationwide, the sale of which is being managed by investment bank Goldman Sachs.

A deadline for first bids for the building society is expected to fall later this month. The building society is expected to sell for between €1 billion and €1.5 billion, bringing a windfall of about €10,000 for each of its estimated 100,000 members.

Landsbanki's net profit for the third quarter was 8.7 billion Icelandic krona (€100 million), up from 5.7 billion krona (€66 million) a year earlier. Net income grew by 61 per cent to 8.52 billion krona (€99 million), while net fee and commission income jumped by 56 per cent to 10.2 billion krona (€119 million).

Responding to questions about its interest in Irish Nationwide, Landsbanki's joint chief executive, Sigurjon Arnason, said: "Our general answer to speculation is that we're always open for opportunities if we feel it fits our strategy and the timing is right."

Landsbanki continued its aggressive overseas expansion this year when it purchased UK stockbroker Bridgewell for £60.3 million (€88.2 million) in May, giving it a second brokerage in London. The Icelandic bank is close to reaching its target of 50 per cent of all revenue coming from overseas. "Maybe the next target we are looking at is 75 per cent [ overseas] to 25 per cent domestically," Mr Arnason said yesterday.

Landsbanki lost 1.86 billion krona (€21 million) in the third quarter of the year due to the liquidity crisis in the capital markets. Mr Arnason said that the bank had no exposure to the US subprime market.

The bank has also expanded overseas to reduce its reliance on the volatile Icelandic economy. - (Additional reporting Bloomberg)