Moody's changes outlook on Iceland's Baa3 rating to stable from negative

Moody's Investors Service has today changed the outlook on the Baa3 rating of the Government of Iceland to stable from negative. The country's Baa3/Prime-3 long and short-term ratings remain unchanged.

Moody's decision to revise the outlook to stable is based on the reduced event risk following the European Free Trade Association's (EFTA) Court decision in January, which adds to a series of positive developments in Iceland over the past 12 months.

Rating Action

Standard & Poor's affirm Iceland's ratings

Standard & Poor's have today affirmed Iceland's BBB-/A-3 long- and short-term sovereign credit ratings and their stable outlook.

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Standard & Poor's changed its outlook on Iceland´s sovereign credit ratings to stable

Standard & Poor's affirmed today an unchanged credit rating for BBB-/A-3 on long and short term of Iceland's foreign and local currency. The outlook was revised to stable from negative.

Highlights of Standard and Poor's statement:
• The Republic of Iceland's economy is recovering from the systemic failure
of its three largest banks, and has returned to positive economic growth
after two years of severe contraction.
• In our view, significant headway has been made in restructuring the
private-sector balance sheet and we expect the process to be mostly
completed by mid-2012.
• We are therefore revising the outlook on the ratings on Iceland to stable
from negative, which balances our view of Iceland's improved economic
fundamentals with downside risks associated with capital controls being
lifted in the next few years.
• We are also affirming the 'BBB-/A-3' sovereign ratings on Iceland.

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Moody's has published an opinion on Baa3/P-3 Iceland's sovereign credit ratings.

 Moody's published on the 15th and 16th of November an opinion on the Republic of Iceland credit rating. Sovereign credit ratings are Baa3 for long-term and P-3 for short-term obligations. The outlook is negative. Both statements of the Rating agency can be seen below.

Moody's Credit Opinion Nov 2011.(pdf)
Moody's Issuer Comment Nov 2011.(pdf)

Quarterly Government Debt Management Prospect fourth quarter

• In Q4, benchmark Treasury bonds will be offered for sale in the amount of 10-30 b.kr.
• Three outstanding Treasury bond series will be expanded: RIKB 13 0517, RIKB 16 1013, and RIKB 31 0124.
• A new 10-year indexed benchmark Treasury bond series will be issued.
• Sales in these series and sales of Treasury bills will be determined with reference to sales in the new series, RIKS 30 0701, issued in connection with capital account liberalisation. Sales will equal at least 10 b.kr., however, so as to maintain issuance in the primary market.

GDM 4Q 2011 .pdf