Islandsbanki hf. completes covered bond issuance

Íslandsbanki hf. has concluded an auction of covered bonds. The new non-indexed issue, ISLA CB 23 was sold today for an amount of ISK 2.08bn at the nominal yield of 6.50%. The CPI-linked issue, ISLA CBI 22, was tapped for an amount of ISK 1.84bn at a real yield of 3.05%. In addition bonds were issued in the aforementioned series for the amount of ISK 960m in ISLA CB 23 and ISK 860m in ISLA CBI 22 in the purpose of providing securities loans to market makers. Following the offering the total size of ISLA CB 23 is ISK 3.04bn and the total size of ISLA CBI 22 has reached 3.78bn.

Íslandsbanki is currently completing new market making agreements with Arion banki hf., Kvika banki hf. and Landsbankinn hf. which include the market makers' right to securities loans in all issues included in the agreements. For this reason Íslandsbanki issued bonds in other covered bond issues which were not auctioned today, amounting to ISK 860m in ISLA CB 19 and ISLA CBI 26. In those issues which do not allow further issuance due to domestic laws on indexation or because the maximum size has been reached Íslandsbanki hf. offered to buy back bonds. Alongside today's auction the nominal amount of ISK 140m was bought back in ISLA CBI 19, ISLA CBI 20 and ISLA CBI 24.

Trading is expected to commence on 26 October 2015 on Nasdaq Iceland which is the maturity date of the non-indexed issue ISLA CB 15.

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