Saga Capital Primary Dealer in HFF Bonds

The Icelandic Housing Financing Fund (HFF) has signed an agreement with Saga Capital Investment Bank regarding Issuance and Market Making in HFF Bonds. The objective of the agreements is to enhance the HFF access to borrowed money and strengthen price formation in the secondary market.

The agreement is valid from July 1st, 2010 and with it Saga Capital has been appointed as Primary Dealer in HFF Bonds. The following bullet points describe the content of the Agreement:

• Primary Dealers have exclusive rights to submit bids at HFF auctions.
  
• Primary Dealers have exclusive access to HFF Securities Lending Facility.
  
• Primary Dealers are obliged to submit bids at each auction for 600 m.kr. nominal value.
  
• Primary Dealers are Market Makers in the secondary market for HFF bonds.
  
• Primary Dealers are obliged to quote on Nasdaq OMX in Iceland bid and ask offers for at least 100 m.kr. nominal value in each HFF bonds.
  
• Primary Dealers are in their bid and ask quotes governed by maximum spreads as laid out in the agreements.
  
• Primary Dealers are obliged to renew their offers within ten minutes after execution of transaction. If the Primary Dealer's total transaction in one series during that day equals 500 m.kr. at nominal value, the Primary Dealer is permitted to withdraw from the maximum spread requirement for that particular series for the remainder of that day.

Market making for HFF150914 will be changed from October 1st, 2010, where Primary Dealers will only have to submit bids for that series