In this agreement the NDMA appoints the following parties as "Authorized Dealers in Government Bonds": Kaupthing ltd, Bunadarbanki Islands ltd., Islandsbanki-FBA ltd., Icebank ltd.
Under the agreement, Authorized Dealers are required to submit bid and offers on the Icelandic Stock Exchange (ISEX) in four bond series. The series are three Index-linked Savings Bond and one conventional Treasury Bond series. Their ISEX codes are: RS03-0210/K, RS05-0410/K, RS15-1001/K RB03-1010/KO
Authorized Dealers will furthermore submit bid and offers for 30 million kronas in each of the series mentioned above with a maximum spread of 7 basis points in terms of yield. After execution of transactions these offers must be renewed within 10 minutes until the intraday total transacted volume reaches 300 million kronas in each series. Under the agreement the intraday transacted volume could theoretically reach 4.800 million kronas.
The agreement will become effective tomorrow, 8 June and will expire on 31 May 2001. It is the belief of the NDMA and the Authorized Dealers that this agreement and increased issuance of information will lead to a greater transaction volume in Government Bonds and increase the market efficiency which will benefit other issuers in the Icelandic Bond Market.
