Today Arion Bank completed a bond offering in Norwegian kroner in a deal arranged by Pareto Öhman. The Bank sold bonds for NOK 500 million (ISK 11.2 billion) that were placed with around 60 investors in Norway, Sweden, Finland, the United Kingdom, continental Europe and Asia. The bond offering was oversubscribed. This is the first time the Bank has raised funding on the international markets and it is also the first international bond offering by an Icelandic financial company since 2007. Prior to the offering the Bank embarked on an extensive roadshow, meeting investors in Norway, Sweden, Finland and in the UK.
The aim is to list the bonds on the Norwegian stock exchange. The bonds are floating rate notes with NIBOR plus 5.00% floating interest, maturing in 2016.
Höskuldur H. Ólafsson, CEO of Arion Bank:
“This is an important moment for us and is the first step towards opening up the international markets. I think it is safe to say that it represents an important milestone in the regeneration of the Icelandic economy. But we must remember that it is only one of many stages in the process of making the international capital markets accessible for Icelandic companies.
This bond issue is acknowledgement of the efforts made here in recent years both inside and outside the Bank. While the recent upgrading of Iceland’s credit rating and the conclusion of the Icesave dispute have had a positive impact, these investors would not have participated in the bond offering if they did not have faith in Arion Bank and its future. The success of the bond offering is a result of the concerted efforts in recent years to build and strengthen the Bank.
Since it was established, Arion Bank has sought to keep international financial institutions and investors informed of the Bank’s progress. We intensified our efforts with regard to funding in 2012 as our objective has been to diversify the Bank’s funding base. We have concentrated on building our reputation and the fruits of our labour are beginning to show.”
On 30 June Arion Bank bought back the outstanding amount of notes held by Kaupthing.
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