Today marks an important milestone in Landsvirkjun’s funding history, as the company’s last outstanding bond carrying a state guarantee reaches maturity. The maturity of the bond represents the final step in Landsvirkjun’s long-standing efforts to remove state guarantees from all its debt portfolio.
The bond was issued in 2006 under Landsvirkjun’s EMTN programme to finance the construction of the Kárahnjúkar Hydropower Plant. It had a principal amount of EUR 150 million, equivalent to approximately ISK 21 billion, and an original tenor of 20 years. Landsvirkjun has paid an annual guarantee fee to the IcelandicTreasury in respect of the guarantee.
The proportion of Landsvirkjun’s loans carrying a state guarantee has declined rapidly in recent years, in line with the company’s objective of reducing and ultimately eliminating state-guaranteed borrowings. For many years, Landsvirkjun has accessed the international debt capital markets on a standalone credit basis, supported by its own financial strength and credit profile.
Following the maturity of this bond, Landsvirkjun has no remaining debt carrying a state guarantee. This reflects the company’s strong financial position and its established access to capital markets.
