Iceland - comment

Iceland priced their refinancing bond yesterday with pricing tightening from initial talks. The Sterling tranche was smaller than we had expected at £265m, priced at 11.125% (10.875% coupon and 99.204 OID) and the Euro tranche at €250m (€ + 550bps, with 97 OID). This refinancing, to December 2027 leaves a stub c.£50m of the March 2025 and the full £250m 2028 bonds. All bonds rank pari-passu. 

The timing of this refinancing has surprised us, with our expectation of refinancing later this year or early next year on the back of momentum from earnings. Iceland has paid up now partially out of fear markets may not be receptive later in the year.