Iceland set to return to bond market after five-year hiatus

Iceland is poised to re-enter the bond market for the first time since the collapse of its major banks.

The country has announced plans to launch a eurobond and has hired Barclays, UBS and Citigroup to gauge investor appetite for the issue, reports the Times. The Icelandic government repaid early on €346m of maturing bonds, leaving €454m in outstanding bonds due for redemption this year and in 2012. Ratings agency Fitch upgraded its outlook for the country from "negative" to "stable" last month. The government hopes the move back into the bond market will help the country claw its way out of recession. The last time Iceland issued new bonds was in 2006, when it raised €1bn.