STOCKHOLM Feb 22 Iceland's Arion Bank, formerly
Kaupthing Bank, said on Friday it has issued its first
international bond, the country's first overseas issue by a
financial group since 2007, the year before its financial system
The bank said it had placed 500 million Norwegian crowns
($88.5 million) in bonds with 60 investors in Europe and Asia.
The bonds, issued on a floating basis to the Norwegian Interbank
Offered Rate (NIBOR) plus 5.00 percent interest, will be listed
on the Norwegian stock exchange.
"I think it is safe to say that it represents an important
milestone in the regeneration of the Icelandic economy," Chief
Executive Hoskuldur Olafsson said in a statement. "The success
of the bond offering is a result of the concerted efforts in
recent years to build and strengthen the Bank."
The country's biggest banks Glitnir, Kaupthing and
Landsbanki all collapsed under massive amounts of debt in 2008,
sending the island nation of 320,000 people into deep recession
and forcing it to borrow around $10 billion from the
International Monetary Fund and other lenders.
The economy is now expanding at a rate of 2 percent - faster
than most of Europe, although inflation remains stubbornly high
and the island still has capital controls in place, making
financing a headache for its companies.
($1 = 5.6503 Norwegian krones)
(Reporting by Mia Shanley; Editing by Hugh Lawson)