Iceland’s Biggest IPO Ever Values Islandsbanki at $1.3 Billion

Iceland is headed for the biggest initial public offering in its history, as a bank that was dragged down by the country’s 2008 financial crisis now has investors piling in to own a piece of the rebuilt product.

Islandsbanki hf says the 55.3 billion kronur ($457 million) it’s offering was oversubscribed “multiple times,” thanks to “substantial interest from both retail and institutional investors.”

The IPO, which values Islandsbanki at about $1.3 billion, is a milestone moment for a bank that suffered a body blow during the financial crisis of 2008. Iceland’s bloated financial system was flattened after foreign loans dried up, and the country required assistance from the International Monetary Fund. Islandsbanki, known as Glitnir back then, was taken over by the state.

Since then, the bank has rebuilt itself, focusing on traditional retail and corporate banking. Its IPO priced at the top of the initial price range, as investors vied for a stake.

“This is the first step in reducing the state’s risk in the banking sector and with that we move closer to a healthier environment, similar to the Nordic countries,” Bjarni Benediktsson, minister of finance, said.

The shares offered were sold by the Treasury of Iceland, which will retain a 65% stake in the bank after the IPO. The plan is to sell the rest at an appropriate time. Other domestic investors will own 24% and international investors 11%.

JPMorgan, Citigroup and Islandsbanki, as well as Barclays, HSBC, FossarMarkaoir, Landsbankinn arranged the deal. Trading in the bank’s shares is set to begin June 22 on Nasdaq Iceland.

©2021 Bloomberg L.P.

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