The Republic of Iceland marked a highly successful return to the Capital Markets in 2025 with a new €750 million 5-year bond

Core Viewpoint - The Republic of Iceland successfully issued a EUR750 million benchmark bond due on 27th May 2030, demonstrating strong investor demand and achieving a minimal new issue concession [5]. Group 1: Transaction Details - The bond was priced at a coupon rate of 2.625% with a re-offer yield of 2.672% [5]. - The spread to mid-swaps was set at m/s+42bps, which is equivalent to a spread of 52.3bps against the OBL 2.400% Apr-30 benchmark [5]. - The transaction attracted over EUR4.3 billion in orders, marking the largest conventional orderbook on record for the Republic of Iceland [5]. Group 2: Pricing and Execution - The mandate for the new 5-year Euro-denominated benchmark was announced on 19th May 2025, with investor calls conducted throughout the day [5]. - Initial guidance was released at m/s+50bps, which was revised tighter to m/s+45bps due to strong demand [5]. - The final size of the bond was confirmed at EUR750 million after the orderbook surpassed EUR3.6 billion [5]. Group 3: Distribution - The allocation of the bond was diversified across various regions, with 25% going to Germany/Austria/Switzerland, 21% to Nordics, 16% to the UK, and smaller portions to Southern EU, Benelux, France, and others [5]. - By investor type, Fund Managers received the largest share at 53%, followed by Central Banks/Official Institutions and Banks at 17% each, and Insurance/Pensions at 12% [5].