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No. 1557/2025

29 December 2025

RULES

on the application of optional and discretionary provisions under the Act on Financial Undertakings.

Article 1. Scope.

These rules apply to financial undertakings under the Act on Financial Undertakings, No. 161/2002.

Article 2. Risk weight on the amount of significant holdings.

The risk weight pursuant to the third paragraph of Article 89 of Regulation (EU) No. 575/2013, cf. the Act on Financial Undertakings, shall be 1250% on the amount that is higher according to the following two points:

• the amount of significant holdings that exceeds 15% of eligible capital, or

• the total amount of significant holdings that exceeds 60% of eligible capital.

Article 3. Valuation of real estate in the cover pool of covered bonds.

For the issuer's valuation of real estate in the cover pool for the issuance of covered bonds, the restrictions pursuant to point (e) of the first paragraph of Article 229 of Regulation (EU) No. 575/2013, cf. the third paragraph of Article 129 of the same Regulation and Article 6 b of the Act on Covered Bonds, No. 11/2008, shall not apply.

Article 4. Limits on large exposures.

The amount limits for exposures to a client that is a financial undertaking or to a group of connected clients of which one or more is a financial undertaking pursuant to the first paragraph of Article 395 of Regulation (EU) No. 575/2013 shall be ISK 15 billion instead of EUR 150 million.

Article 5. Deduction items for large exposures.

When calculating the amount of exposures pursuant to the first paragraph of Article 395 of Regulation (EU) No. 575/2013, it is permitted to exclude the following items:

• Covered bonds that meet the conditions of the Act on Covered Bonds, No. 11/2008, cf. point (a) of the second paragraph of Article 400 of Regulation (EU) No. 575/2013.

• Claims on regional and local authorities within the European Economic Area, other than pursuant to point (e) of the first paragraph of Article 400 of Regulation (EU) No. 575/2013, may be excluded to the extent of 80% when they are claims that fall under a 20% risk weight pursuant to Chapter 2 of Title II of Part Three of the Regulation. The same applies to guarantees and other exposures of the same parties, cf. point (b) of the second paragraph of Article 400 of Regulation (EU) No. 575/2013.

Article 6. Entry into force.

These rules, which are issued with authority in the fourth paragraph of Article 117 b of the Act on Financial Undertakings, No. 161/2002, enter into force immediately. Upon their entry into force, Rules No. 789/2022 on the same subject shall be repealed.

Central Bank of Iceland, 29 December 2025.
Ásgeir Jónsson
Governor of the Central Bank.
Gísli Óttarsson
Managing Director.

Section B — Publication date: 30 December 2025