Nasdaq Iceland

Nasdaq Iceland is Iceland’s principal organized securities exchange and a member of the broader Nasdaq Nordic market structure. Based in Reykjavík, it provides a regulated marketplace for Icelandic shares and bonds, supporting capital raising, secondary-market trading, price discovery and public-company disclosure. The exchange is the successor to the Iceland Stock Exchange, commonly known as ICEX, which was established in 1985 as a joint venture of Icelandic banks and brokerage firms following an initiative by the Central Bank of Iceland. Trading began in 1986 with Icelandic government bonds, with the central bank acting as market maker. The exchange introduced its first electronic trading system in 1989, and equity trading began in 1991. The equity market expanded considerably during the 1990s; by 1999, 75 companies were listed, including companies on both the main market and a growth list. A 1998 law required the exchange to become a limited company from 1 January 1999, changing its corporate structure and broadening its shareholder base to include financial institutions, listed companies, pension funds and the Central Bank of Iceland. In 2000, ICEX joined the NOREX cooperation framework and adopted the common SAXESS trading system. Integration with the Nordic exchanges reduced the isolation of Iceland’s relatively small market and provided participants with a more standardized trading environment. The exchange also supported limited cross-border activity, including the listing of Faroese bonds and, in 2005, Atlantic Petroleum, the first Faroese company to list on the exchange. Such Faroese activity later migrated mainly to Nasdaq Copenhagen. OMX acquired ICEX in 2006, after which the market was renamed OMX Iceland. Nasdaq’s acquisition of OMX in 2007 led to further renaming, first as Nasdaq OMX Iceland and eventually as Nasdaq Iceland. In 2010, the exchange moved to Nasdaq’s INET trading platform. The market was severely affected by Iceland’s 2008 financial crisis. Banks had become disproportionately important in the market: six financial institutions accounted for 87 percent of the OMXI15 index’s weight in June 2008. After Kaupthing, Landsbanki and Glitnir were placed under state control, trading was suspended on 9, 10 and 13 October 2008. When trading resumed on 14 October, the OMXI15 index had fallen 77 percent from its 8 October close, while the broader OMXIPI index had declined 67 percent. Listed equity value contracted from ISK 2.57 trillion at the end of 2007 to ISK 208 billion at the end of 2009, while the number of companies on the main list fell to 10 and turnover dropped sharply. During the 2010s, listings and trading activity gradually recovered. In 2021, annual turnover exceeded ISK 1 trillion for the first time since the financial crisis, and the number of companies on the main market had reached 20, twice the level reported for the post-crisis market in 2009. Nasdaq Iceland remains a comparatively small and specialized exchange. Its listed companies span sectors including retail, fishing, transportation, banking and real estate, and many securities have limited liquidity because of the size of Iceland’s economy.

Nasdaq Iceland originated as the Iceland Stock Exchange, or ICEX, founded in 1985 by Icelandic banks and brokerage firms at the initiative of the Central Bank of Iceland. Its first trading activity began in 1986 with Icelandic government bonds, for which the central bank served as market maker. Electronic trading was introduced in 1989, and the exchange began trading equities in 1991. The equity market grew through the 1990s. In 1998, Icelandic legislation required ICEX to operate as a limited company from the beginning of 1999. Its shareholders included financial institutions, listed companies, pension funds and the Central Bank of Iceland. In 2000, ICEX joined NOREX, a Nordic exchange-cooperation framework, and implemented SAXESS, a shared trading system intended to improve interoperability and liquidity. The exchange subsequently supported some cross-border listings, including Faroese bonds and Atlantic Petroleum in 2005. OMX acquired ICEX in 2006, creating OMX Iceland. Following Nasdaq’s acquisition of OMX in 2007, the exchange became Nasdaq OMX Iceland and later Nasdaq Iceland. Its trading technology was further modernized in 2010 through the adoption of Nasdaq’s INET platform. The exchange experienced an extreme contraction during Iceland’s 2008 banking and financial crisis. The banking sector had come to dominate the market, and six banks and financial institutions represented most of the OMXI15 index. After three major banks were taken under state control, trading was suspended for three successive trading days in October 2008. The market reopened with a 77 percent decline in the OMXI15 index relative to its last pre-suspension close. Market capitalization, listings and turnover all fell sharply over the following two years. Recovery was gradual during the 2010s. By 2021, turnover had exceeded ISK 1 trillion for the first time since the crisis, and the number of main-market companies had risen to 20. Nasdaq Iceland now operates within Nasdaq Nordic and provides a domestic venue for Icelandic shares and fixed-income securities. Because Iceland’s economy and listed-company universe are relatively small, many securities remain less liquid than those on larger international exchanges.

1. 2021Turnover recovery

   Annual turnover exceeded ISK 1 trillion for the first time since the financial crisis, while main-market listings had recovered to 20 companies.

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2. 2010INET platform adopted

   Nasdaq Iceland migrated to Nasdaq’s INET trading system.

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3. 2008Financial-crisis market suspension

   Trading was suspended on 9, 10 and 13 October after the Icelandic banking crisis; the OMXI15 index fell 77 percent when trading resumed.

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4. 2007Nasdaq acquisition of OMX

   Nasdaq’s acquisition of OMX led to the exchange being renamed Nasdaq OMX Iceland and later Nasdaq Iceland.

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5. 2006OMX acquisition

   OMX acquired the Iceland Stock Exchange, which was subsequently renamed OMX Iceland.

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6. 2005First Faroese company listing

   Atlantic Petroleum became the first Faroese company listed on ICEX.

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7. 2000NOREX integration

   ICEX joined the NOREX framework and adopted the shared SAXESS trading system.

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8. 1999Conversion to a limited company

   Following legislation passed in 1998, ICEX began operating as a limited company.

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9. 1991Equity trading begins

   The exchange began trading listed equities.

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10. 1989Electronic trading introduced

    The exchange launched its first electronic trading system.

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11. 1986Bond trading begins

    Trading commenced with Icelandic government bonds, with the Central Bank of Iceland acting as market maker.

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12. 1985Iceland Stock Exchange established

    The Iceland Stock Exchange was formed as a joint venture of Icelandic banks and brokerage firms on the initiative of the Central Bank of Iceland.

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A small, internationally integrated Nordic exchange serving Icelandic issuers and investors, with particular importance for domestic equities, government bonds and corporate bonds.

• Nasdaq Iceland Main MarketEquities

  The principal regulated market for publicly traded Icelandic companies. Listed issuers have included businesses from retail, fishing, transportation, banking and real estate. The market provides admission, trading and disclosure infrastructure, although the relatively small domestic economy means that many securities have limited liquidity.

• Icelandic bond marketFixed income1986

  Nasdaq Iceland provides a venue for Icelandic government and corporate bonds. Fixed-income trading was the exchange’s original activity when trading began in 1986, before equity trading was introduced in 1991.

• OMXI15Index

  A leading Icelandic equity index associated with the exchange. Its heavy exposure to banks and other financial institutions made it particularly vulnerable during the 2008 Icelandic financial crisis.

• INETTrading technology2010

  Nasdaq’s electronic trading platform adopted by Nasdaq Iceland in 2010 as part of the exchange’s technology integration with the wider Nasdaq marketplace.

• 2010Migration to the INET trading platformStrategy

  Nasdaq sought to standardize technology across its exchange operations.

  What changed. Nasdaq Iceland replaced its previous trading technology with Nasdaq’s INET system.

  Aftermath. The exchange became more closely aligned with Nasdaq’s international trading infrastructure.

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• 2006OMX acquires ICEXM&A

  ICEX was integrated into the expanding Nordic exchange network.

  What changed. OMX acquired the Iceland Stock Exchange and renamed it OMX Iceland.

  Aftermath. The exchange became part of the OMX group and subsequently entered Nasdaq’s organization after the Nasdaq-OMX transaction.

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• 2000Join the NOREX cooperation frameworkStrategy

  The Icelandic market was small and relatively isolated from other Nordic exchanges.

  What changed. ICEX joined NOREX and implemented the shared SAXESS trading system.

  Aftermath. The change increased integration with Nordic market infrastructure and was intended to improve market liquidity and accessibility.

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1. Nasdaq Iceland
2. Nasdaq Nordic official website