Iceland Stock Exchange
Encyclopedia
NASDAQ OMX Iceland or ICEX was established in 1985 as a joint venture of several banks and brokerage firms on the initiative of the central bank
. Trading began in 1986 in Icelandic government bond
s, and trading in equities began in 1990. Equities trading increased rapidly thereafter. A wide variety of firms are currently listed on the exchange, including firms in retail, fishing, transportation, banks, insurance and numerous other areas. Because of the small size of the Icelandic economy
and the low cost of public listing, many of the companies traded on the ICEX are relatively small and are relatively illiquid.
All domestic trading of Icelandic bonds, equities and mutual funds takes place on the ICEX. Bonds and equities are regularly traded, though the liquidity is small in comparison with other exchanges. No mutual funds are currently listed on the market. Since its founding, the ICEX has used various electronic systems. Since 2000, it has used the SAXESS system of the NOREX
alliance, which allows for the cross-listing of stocks on Nordic
stock exchanges. No foreign company lists directly on the ICEX, as the small size and illiquidity of the market makes such a move redundant. Conversely, few Icelandic firms have listed abroad, including DeCODE. Faroese
bonds were listed on behalf of Virðisbrævamarknaður Føroya
in November 2003, and since December 2007 four Faroese equities have been listed on the OMX Nordic Exchange in Iceland.
Since 1 January 1999, the ICEX has operated as a private company, owned by the listed companies (29%), member firms (29%), the Central Bank of Iceland
(16%), pension funds (13%) and the Association of Small Investors (13%).
Páll Harðarson is the current president of the stock exchange. ICEX agreed to be taken over by larger rival OMX
Nordic Exchange on 19 September 2006.
On 6 October 2008, the Icelandic Financial Supervisory Authority decided to temporarily suspend trading on regulated market financial instruments issued by Glitnir
, Kaupthing Bank
, Landsbanki
, Straumur Investment Bank
, Spron and Exista. When the exchange reopened on 14 October, the stock index fell by 76%.
Central Bank of Iceland
The Central Bank of Iceland is the central bank or reserve bank of Iceland. It has served in this capacity since 1961, when it was created by an act of the Alþingi out of the central banking department of Landsbanki Íslands, which had had the sole right of note issuance since 1927 and had...
. Trading began in 1986 in Icelandic government bond
Government bond
A government bond is a bond issued by a national government denominated in the country's own currency. Bonds are debt investments whereby an investor loans a certain amount of money, for a certain amount of time, with a certain interest rate, to a company or country...
s, and trading in equities began in 1990. Equities trading increased rapidly thereafter. A wide variety of firms are currently listed on the exchange, including firms in retail, fishing, transportation, banks, insurance and numerous other areas. Because of the small size of the Icelandic economy
Economy of Iceland
The economy of Iceland is small and subject to high volatility. In 2007, gross domestic product was US$12.144bn in total and $38,400 per capita, based on purchasing power parity estimates...
and the low cost of public listing, many of the companies traded on the ICEX are relatively small and are relatively illiquid.
All domestic trading of Icelandic bonds, equities and mutual funds takes place on the ICEX. Bonds and equities are regularly traded, though the liquidity is small in comparison with other exchanges. No mutual funds are currently listed on the market. Since its founding, the ICEX has used various electronic systems. Since 2000, it has used the SAXESS system of the NOREX
NOREX
In 1997, the Copenhagen Stock Exchange and the Stockholm Stock Exchange initiated formalized cooperation through NOREX, with the purpose of establishing a joint Nordic securities market...
alliance, which allows for the cross-listing of stocks on Nordic
Nordic countries
The Nordic countries make up a region in Northern Europe and the North Atlantic which consists of Denmark, Finland, Iceland, Norway and Sweden and their associated territories, the Faroe Islands, Greenland and Åland...
stock exchanges. No foreign company lists directly on the ICEX, as the small size and illiquidity of the market makes such a move redundant. Conversely, few Icelandic firms have listed abroad, including DeCODE. Faroese
Faroe Islands
The Faroe Islands are an island group situated between the Norwegian Sea and the North Atlantic Ocean, approximately halfway between Scotland and Iceland. The Faroe Islands are a self-governing territory within the Kingdom of Denmark, along with Denmark proper and Greenland...
bonds were listed on behalf of Virðisbrævamarknaður Føroya
Faroese Securities Market
Virðisbrævamarknaður Føroya was founded March 31, 2004. Technical operator for the market is the Iceland Stock Exchange.-External links:*...
in November 2003, and since December 2007 four Faroese equities have been listed on the OMX Nordic Exchange in Iceland.
Since 1 January 1999, the ICEX has operated as a private company, owned by the listed companies (29%), member firms (29%), the Central Bank of Iceland
Central Bank of Iceland
The Central Bank of Iceland is the central bank or reserve bank of Iceland. It has served in this capacity since 1961, when it was created by an act of the Alþingi out of the central banking department of Landsbanki Íslands, which had had the sole right of note issuance since 1927 and had...
(16%), pension funds (13%) and the Association of Small Investors (13%).
Páll Harðarson is the current president of the stock exchange. ICEX agreed to be taken over by larger rival OMX
OMX
OMX AB is a Swedish-Finnish financial services company, formed in 2003 through a merger between OM AB and HEX plc and is now a part of the NASDAQ OMX Group since February 2008.It has two divisions, OMX Exchanges, which operates eight stock exchanges mainly in the Nordic and Baltic...
Nordic Exchange on 19 September 2006.
On 6 October 2008, the Icelandic Financial Supervisory Authority decided to temporarily suspend trading on regulated market financial instruments issued by Glitnir
Glitnir (bank)
Glitnir was an international Icelandic bank. It was created by the state-directed merger of the country's three privately held banks - Alþýðubanki , Verzlunarbanki and Iðnaðarbanki - and one failing publicly held bank - Útvegsbanki - to form Íslandsbanki in 1990...
, Kaupthing Bank
Kaupthing Bank
Kaupthing Bank was an international Icelandic bank, headquartered in Reykjavík, Iceland. It was formed by the merger of Kaupthing and Búnaðarbanki Íslands in 2003 and was the largest bank in Iceland....
, Landsbanki
Landsbanki
Landsbanki, also commonly known as Landsbankinn in Iceland, is a private Icelandic bank with international operations...
, Straumur Investment Bank
Straumur Investment Bank
Straumur-Burdaras Investment Bank hf. was a regional investment bank headquartered in Reykjavik, Iceland, that was closed by regulators in March 2009.The company was mainly owned by Björgólfur Guðmundsson and his son Björgólfur Thor Björgólfsson...
, Spron and Exista. When the exchange reopened on 14 October, the stock index fell by 76%.