Islandsbanki hf. : Covered bond issues
Íslandsbanki hf. has concluded an auction of two CPI-linked covered bonds listed on NASDAQ OMX Iceland. No bids were accepted in ISLA CBI 24. A new six-year CPI-linked issue, ISLA CBI 20, was sold today for an amount of ISK 960,000,000 at a real yield of 3.50%.
In total, Íslandsbanki has now issued covered bonds amounting to ISK 28.33bn since its inaugural issue in December 2011.
Sold to a broad group of investors, total appetite for the issue amounted to ISK 2,63bn, of which 36.5% of the offers were accepted. Trading is expected to commence on 23 June 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.