Iceland’s Kaupthing Bank Lowers Interest Rates Skip to content

Iceland’s Kaupthing Bank Lowers Interest Rates

The retail banking arm of Kaupthing Bank, which serves as a high-street bank in Iceland, announced that as of today the rates of new mortgage loans would be decreased by 0.35 percentage points. This makes the bank’s lowest possible interest rate on such mortgage loans 6.05 percent.

On Friday afternoon Kaupthing Bank closed its bond issue for institutional investors, which will be used to finance the new mortgage loans, Morgunbladid reports.

The bank received offers of up to ISK 6.8 billion (USD 84 million, EUR 53 million) and offers totaling ISK 4.8 billion (USD 59 million, EUR 38 million) were accepted in two bond classes. The weighted average yield was 5.17 percent for the class on which Kaupthing’s mortgages are based.

The decision was made to lower interest rates according to Kaupthing Bank’s interest premium.

The state-run Housing Financing Fund (HFF) also recently lowered its interest rates on mortgages.

Click here to read more about that.

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