09 February 2012

Bond price for foreign exchange auction

According to an announcement published by the Central Bank of Iceland on 12 January 2012, the Terms of Auction state that the swap rate for the Bank’s purchase of foreign currency in connection with the sale of Treasury bonds in the series RIKS 30 0701 would be published at the close of business on 9 February 2012.

It has been decided that the number of Treasury bond units per euro shall be based on the auction price and the fixed price of the Treasury bonds, which is 115.675833 kr. per Treasury bond unit with accrued interest and indexation (dirty price), assuming a settlement date of 17 February 2012 (yield 2.50%).* The formula is as follows: Swap rate = auction price/(bond price/100).


*The price with accrued interest and indexation (dirty price) gives a yield of 2.50% and a clean price of 110.930.