Islandsbanki hf. : Covered Bond Tap Issues

03.03.2014 - IR Releases

Íslandsbanki hf. has tapped into outstanding issues of CPI-linked covered bonds listed on NASDAQ OMX Iceland. ISLA CBI 19, was tapped for an amount of ISK 1,070,000,000 at a real yield of 3.20% and ISLA CBI 24, was tapped for an amount of ISK 270,000,000 at a real yield of 3.24%.

Following these latest issues, the total amount issued in ISLA CBI 19 has reached ISK 7.70bn and ISLA CBI 24 has reached ISK 8.73bn. In total, Íslandsbanki has now issued covered bonds amounting to ISK 25.92bn since its inaugural issue in December 2011.

Sold to a broad group of investors, total appetite for the tap issue amounted to ISK 1.69bn, of which 79% of the offers were accepted. Trading is expected to commence on 7 March 2014 on the NASDAQ OMX Iceland. Market making for all of Íslandsbanki's covered bond issues is in the hands of MP bank.

The bonds are issued under Act 11/2008 on Covered Bonds which obliges the issuer to fulfil strict requirements, whereby the underlying cover pool must withstand a weekly stress test with regards to interest rates and exchange rates. The issuances are regulated by the Icelandic Financial Supervisory Authority which additionally appoints an independent inspector to monitor the issuances. Special cover pool reports on the covered bond issuances are published quarterly and can be found on Íslandsbanki's web.