Festi hf: New market making agreements with Arion Banki hf. and Landsbankinn hf.
29 Junho 2023 - 2:13PM
Festi hf: New market making agreements with Arion Banki hf. and
Landsbankinn hf.
Festi has concluded new market making agreements
on its shares listed on the Nasdaq Iceland stock exchange. The
agreements take effect as of July 1, 2023, and are indefinite with
a notice period of 14 days. The company's agreement with
Íslandsbanki hf. on market making has been terminated as of the
same date.
The purpose of the market making agreements is
to promote trading in Festi’s shares in order to create market
prices and price formation to take place in an efficient and
transparent manner.
Festi's agreement with Arion Banki replaces an
earlier agreement between the same parties as stated in
announcements on 11 March 2020 and 13 September 2021. According to
the agreement, the Bank will submit bid and offer quotes for shares
issued by Festi in the Nasdaq Iceland trading system each trading
day. If submitted offers are accepted or cancelled, the Bank shall
submit such new offers as soon as possible. If an offer is
accepted, the Bank shall submit such new offer within 10 minutes
until the maximum amount has been reached. The amount of each offer
shall be a minimum of 100,000 shares in the Company at a price
determined by the Bank; however, the offer shall not be subject to
a deviation of more than 3% from the last transaction price.
According to the agreement, the spread between bid and offer rates
shall be determined by reference to the tick size table of the
Stock Exchange as it stands at any given time, in such a way that
the spread will be as close as possible to 1.5% but not lower than
1.45%. However, Arion Banki shall be permitted to submit bid and
sell offers with a lower price range than above, e.g., due to
circumstances arising from the Stock Exchange's tick size table. If
Arion Banki’s trades in Festi’s shares exceed the Bank’s trading
book, amounting to a total market value of ISK 50,000,000, within
the trading day, the above obligations regarding the maximum
intraday bid and offer margin shall cease. If the price change of
the company's shares within the trading day is exceeds 5%, the Bank
is authorized to increase the maximum spread to 3% and if the price
change within the trading day is in excess of 10%, the Bank is
authorized to increase the maximum spread to 4.5%.
The agreement between Festi and Landsbankinn
stipulates that the Bank will, as market maker, submit daily bid
and sell offers for the company's shares, amounting to at least ISK
15,000,000 at market value. Tenders shall be renewed as soon as
possible, however, always within 15 minutes of their full
acceptance. The maximum amount that Landsbankinn is obliged to buy
or sell each day is ISK 30,000,000 at net market value, which is
calculated as the difference between the Bank's accepted bid and
sell quotes. If the maximum volume of the day is reached, the
Bank's obligation to submit bids on the filled side shall cease
until the Bank's bid has been accepted on the opposite side and the
net transaction volume is again below the daily maximum. The
volume-weighted maximum price spread between the Bank's bid and
sell orders is determined by the 10-day volatility of Festi's share
price as measured at any given time and published in Bloomberg's
information system. Where 10-day volatility is less than 30%, the
volume-weighted range shall not exceed 1.5%; where 10-day
volatility is equal to and/or greater than 30%, the volume-weighted
spread shall be 3%.
According to the foregoing, Arion Banki and
Landsbankinn will act alone as market makers with Festi’s shares as
of Monday 3 July 2023.
For further information please contact Magnús
Kr. Ingason, Chief Finance and Operations Officer at Festi,
mki@festi.is
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