19 May 2017

Terms, conditions, purch. offshore kr. assets

Redwing and Central Bank of Iceland

With reference to press releases issued by the Central Bank on 5 May 2017, the Bank offers to purchase offshore króna assets as these are defined in the Act on the Treatment of Króna-Denominated Assets Subject to Special Restrictions, no. 37/2016, in cash and for euros, at an exchange rate of 137.5 krónur per euro. This offer applies to deposits, bills, and bonds issued by the Treasury or the Housing Financing Fund (HFF), and Central Bank certificates of deposit (CBI2016).

Offshore króna assets in the form of deposits shall be exchanged for Central Bank certificates of deposit prior to the transaction. The price of offshore króna assets will be based on the best bid at the close of business on 10 March 2017, as is specified in the table below, plus accrued interest at the settlement date. All payments on behalf of the Central Bank will be made through Clearstream and Euroclear as intermediaries of the bank.

This offer extends to foreign financial institutions, funds, and eligible counterparties that satisfy all internal approvals and conditions including the Central Bank’s KYC and AML requirements, and credit checks vis-à-vis the intermediaries. Such parties may conduct transactions on their own accounts or on behalf of their customers.

Owners of offshore krónur shall contact the custodian of the assets in question as regards trades and settlement, as it should be noted that both deadlines to submit trades and settlement dates may differ from one custodian to another.

Trade requests must be received from the intermediaries by the end of day on Thursday 15 June 2017, with settlement occurring on the 22 June 2017.

The terms and conditions relating to the Central Bank’s offer are available here

Further information can be obtained from Már Guðmundsson, Governor of the Central Bank of Iceland, and Sturla Pálsson, Director of Treasury and Market Operations, at tel: +354 569-9600. Inquiries regarding the execution of trades can be sent by e-mail to offshore@sedlabanki.is.

No. 16/2017
19 May 2017