Landsbankinn signs market-making deals for covered bonds

Published 03/10/2025, 16:42
Landsbankinn signs market-making deals for covered bonds

REYKJAVIK - Landsbankinn hf. has entered into market-making agreements with three Icelandic banks for its covered bonds listed on NASDAQ Iceland, the company announced in a press release.

The agreements with Arion bank hf., Islandsbanki hf., and Kvika bank hf. will take effect on October 6, 2025. Under the terms, the market makers will place daily bid and ask orders for Landsbankinn’s covered bonds before market opening on business days.

The minimum nominal amount for orders will vary based on series size, ranging from ISK 30-80 million. For inflation-linked series LBANK CBI 26 and LBANK CBI 28, the minimum order amount is set at ISK 40 million.

Market makers will be released from their daily obligations once their trading volume reaches ISK 500 million across all covered bond series. Maximum spreads between bid and ask orders are structured according to maturity timeframes, from 0.20% for bonds with 6 months to 2 years maturity up to 1.15% for bonds with 18 years or longer maturity.

Inflation-linked series with less than two years to maturity are exempt from the maximum spread requirements.

To support these agreements, Landsbankinn will provide each market maker with bond lending facilities allowing them to borrow up to ISK 320 million in each series.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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