Dealers in the Market Taking IOIs for Swedish Sovereign Green Bond

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    Stockholm (NordSIP) – Following a lengthy design and marketing process, which culminated with last week’s publication of the investor presentation by the debt management office, Sweden’s much-awaited sovereign green bond is finally in the market.

    Books are open, and dealers have received indications of interest (IOIs) in excess of SEK40 billion, including SEK600 million in joint lead manager interest, during the morning of September 1st. The target size for this debt bond is SEK20 billion. The security will pay a fixed rate coupon. Initial price guidance was set at between 32 basis points (bps) and 30bps below mid-swaps, but IOIs were at MS -29bps.

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    Barclays, Danske Bank, NatWest Markets, SEB, Swedbank are the bookrunners on this transaction. The securities are being marketed to eligible counterparties, including professional and retail, through all distribution channels. Sales to US qualified institutional buyers (QIBs) follow the SEC’s rule 144A.

    “I am very pleased that the collaborative efforts that have gone into this project have enabled us to now present Sweden’s sovereign green bond, which combines low risk with a dark green stamp of approval,” Hans Lindblad, Director General of the Debt Office, commented on the occasion of the publication of the investor presentation.

    “This is the first time Sweden issues a green bond, and the ambition of attracting SEK 20bn makes it the largest green bond in Swedish kronor ever,” Lars Mac Key, responsible for sustainable bonds at Danske Bank, commented on the occasion of the publication of the investor presentation. “What differentiates this green bond from other bonds is that investors can follow what government expenditure the bond is linked to and what environmental and climate effects the financing contributes to.”

    The Swedish government’s green bond framework was reviewed by CICERO Shades of Green and was rated “dark green”. “The majority of funds in the first round of allocations are planned for clean transportation, with a focus on maintenance and operation of electrified railways,” Cicero noted.

    Pricing on this transaction is expected to conclude soon. The security will settle on September 9th.

    Image by Ahmad Ardity from Pixabay

    Filipe Albuquerque
    Filipe Albuquerque
    Filipe is an economist with 8 years of experience in macroeconomic and financial analysis for the Economist Intelligence Unit, the UN World Institute for Development Economic Research, the Stockholm School of Economics and the School of Oriental and African Studies. Filipe holds a MSc in European Political Economy from the LSE and a MSc in Economics from the University of London, where he currently is a PhD candidate.
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