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Hitt og þetta 13. apríl 2006

(IFN) Kaupthing completes USD500M bond sale

Reykjavik (IFN) Icelandic investment bank Kaupthing Bank has completed a USD500 million, five-year bond issue, the bank said in a statement.

Kaupthing, like Iceland's other two major banks ? Landsbanki Islands and Glitnir Bank ? has been the subject of a number of critical credit reports.

The bank said the issue, the first under the US 144A MTN program, was sold in its entirety to a single party. The transaction was arranged by Citigroup and Deutsche Bank.

Including Kaupting's latets issue, the bank has made total issues equivalent to EUR1.8 billion so far this year, while it has long-term debt equivalent to EUR1.3 billion maturing in 2006.

In light of market fluctuations in recent weeks, Kaupthing Bank said it doesn't expect U.S. investors now carrying extendible bonds to choose to extend their bonds on April 20. As a result, $605 million will come due for payment in spring 2007.

"This inaugural $500 million bond issue in the U.S. demonstrates that Kaupthing Bank has good access to the U.S. investor base, and the bank will continue issuing bonds there in coming months," Gudni Adalsteinsson, group treasurer at Kaupthing said.

"However, it is regrettable that the US extendible-bond holders will choose not to extend their bonds, but in light of the recent market fluctuations this was not unexpected," he added.

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Icelandic Financial News (IFN) is available on Factiva, a joint venture between Reuters and Dow Jones Newswires, FT.COM, LexisNexis, Comtex, Gale and Thomson via the Nordic Business Report.