Proposal by the IL Fund to amend the terms of HFF bonds approved by bondholders

On 10th of April, a meeting of bondholders of HFF34 and HFF44 was held. At the meeting, a proposal was put forward for an amendment to the terms of the bonds, which permits the issuer to settle the bonds by delivery of certain assets. The proposal is the result of more than a year of negotiations between the advisors of 18 pension funds, which together hold the majority of the fund’s debt, and the negotiating committee of the Minister of Finance and Economic Affairs.

81.4% of the owners of the claim amount who voted at the meeting on the HFF34 category, approved the proposal, which is binding for all owners equally.

81.6% of the owners of the claim amount who voted at the meeting on the HFF44 category, approved the proposal, which is binding for all owners equally.

On 8th of April, a Supplementary Budget Bill, Parliamentary Document 367, was published on the website of the Parliament. If the bill becomes law, the Minister of Finance and Economic Affairs will have the necessary powers from Parliament to be able to enter into a settlement in accordance with the proposal, which is a prerequisite for the winding up of the IL Fund.

According to the proposal, the issuer is expected to notify the creditor with at least seven days’ notice if the issuer decides to exercise the settlement authorisation. On June 14, 2025, the proposal expires.

Daði Már Kristófersson, Minister of Finance and Economic Affairs:

“I welcome the decision of the bondholders, which in most cases are domestic pension funds, to accept this offer to complete the settlement of the IL Fund. I would also like to take this opportunity to praise and thank all parties involved in the case for having solved this complex issue and come to a common conclusion for the good of Icelandic society.”