Iceland review - 2013, Qupperneq 102

100 ICELAND REVIEW
Invest
In Iceland
The Comeback
Story
First established in 1985, the Icelandic stock
exchange is today a part of NASDAQ OMX,
the world’s largest exchange company. It
lists 17 companies, four of which are part of First
North, an alternative growth market on NASDAQ
OMX Nordic designed for small businesses.
Among the NASDAQ OMX Iceland listings are the
Icelandair Group, Marel (a leading global provider
of advanced equipment and systems for the food
processing industry), Össur (a producer of non-
invasive orthopedics and prosthetics), Eimskip
(shipping), Reginn (real estate) and vodafone
Iceland (telecommunications). Looking to the
future, the exchange hopes to include listings
of well-established Icelandic brands, such as
N1 (a gas station chain), Advania (IT company),
Sjóvá (insurance), Reitir (real estate) and financial
institutions such as Arion Bank, Landsbankinn,
Íslandsbanki and MP Bank.
Following Iceland’s economic collapse in 2008,
Páll Harðarson, the president of NASDAQ OMX
Iceland, says that the exchange’s primary goal is
to rebuild the country’s equity market, a project
which has been going quite well. By the begin-
ning of May, equity trading exceeded totals for all
of last year, and the bond market is also keeping
pace. Moreover, in the past 18 months, six new
companies have listed on the exchange. “The
while demonstrating substantial growth potential
in the international market. She points to such
companies as Betware, an online gaming plat-
form utilized by state lotteries around Europe and
Marorka, a leading provider of energy manage-
ment technology for the shipping industry as
examples of creative and unique Icelandic busi-
nesses which could expand investment alterna-
tives on the Icelandic market.
As the Icelandic market expands, it’s easier
to build and offer new products to investors.
One upcoming development that NASDAQ OMX
Iceland thinks has particularly strong potential
is the introduction of Exchange-Traded Funds
(ETFs), or mutual funds which are traded on the
market like stocks and easier for the retail investor
to manage. These ETFs will be introduced during
summer 2013 and will be a good option for inves-
tors who want to diversify their portfolios and get
a sense of the investment landscape in Iceland
without having to select one or two specific com-
panies or bonds.
NASDAQ OMX Iceland is also eager to support
new businesses in Iceland, even before they are
ready to list. “First and foremost, the market is
a financing venue for business,” Páll says. “The
basic role of the exchange is to help companies
grow.” Even if a company won’t join the market
for several years, he explains, being able to show
that listing is part of the development plan can
make it easier to attract early investors. And
NASDAQ OMX has further demonstrated its com-
mitment to nurturing up-and-coming businesses
by being a major sponsor of initiatives such as
the Startup Iceland entrepreneurial conference.
“As an exchange, it’s very exciting to be able to
help companies raise funds and be a part of their
success stories,” says Kristín.
Rebuilding a market is no easy prospect, Kristín
continues, and “there have been a lot of Plan Bs
over the years.” But those working at NASDAQ
OMX Iceland remain optimistic about Iceland’s
economic growth and the exchange’s role in the
revitalization process. “We are going to be a part
of that comeback story.”
companies which are listing reflect the changing
economy. They are more diversified than before,”
Páll says. By taking a stake in the Icelandic
market, he continues, investors confirm that they
believe in the broader project: the rebuilding of
the Icelandic economy from the ground up.
Although trading on a daily basis is more driv-
en by local investors, foreign investors have been
showing a renewed interest in the Icelandic stock
exchange and currently account for about 20
percent of the equity market. In part, this interest
may be driven by Iceland’s unique position on
the world market: the exchange is part of a larger
trading group (NASDAQ OMX) and has a similar
legal and trading infrastructure to that in Europe.
However, Iceland’s economic recovery illustrates
that its prospects are not entirely dependent on
growth in Europe. “From an investment perspec-
tive, Iceland offers something different,” Páll
says. “Both in terms of the companies we have
listed and the economy as a whole.”
Companies such as Hagar, a retailer which
owns 58 businesses including the Bónus and
Hagkaup grocery chains, and insurance provid-
ers vÍS and TM, offer long-term stability and reg-
ular dividend payments for investors. Meanwhile,
institutions such as the Icelandair Group have
seen a steady increase in stock value as the
króna has dropped and travel for tourism and
professional conferences has been on the rise.
Looking towards the future, NASDAQ OMX
Iceland is particularly interested in working
with what communications manager Kristín
Jóhannsdóttir calls Iceland’s innovation sector:
companies which span a wide variety of fields,
but are all “doing something new and fresh,”