Swedish Investors Board EUROFIMA’s SEK Debuts

    Stockholm (NordSIP) –  At the end of November, EUROFIMA issued SEK2.5 billion in eight-and five-year green bonds. The two transactions were the issuer’s first in the Swedish market and its largest SEK transaction to date.

    EUROFIMA is a supranational organization based in Basel, Switzerland. Its mission is to support the development of rail transportation in Europe and to support the railway operators, its shareholders, in renewing and modernizing their rolling stock.

    “After a record year in new loans granted to our member railways, we still see continued demand for loans in non-benchmark tenors. Our inaugural Swedish Krona Green Bond allows us to support our clients in renewing and modernizing their rolling stock and to further promote sustainable transport across Europe, while at the same time providing additional ESG compliant investment opportunities to the Swedish investor community. In addition, our first Swedish Krona transaction since more than ten years helps us in diversifying our funding base,” says Stefan Hoeferlin, Senior Funding Manager at EUROFIMA

    Both of the green bonds are denominated in Swedish Krona. The first transaction was a SEK1.5 billion eight-year green bond priced on November 20th and pays a coupon of 0.490%, and was priced at par, 25 basis points (bps) over mid-swaps. The second transaction was a SEK1 billion green bond priced on November 26th. It pays a fixed coupon of 0.2125%. Danske Bank acted as sole lead manager on both transactions.

    “This transaction is predominantly a testament of two things. Firstly, that EUROFIMA attracts interest from such knowledgeable green bond investors is a testament of their support to the sustainable development of public passenger rail transportation in Europe and to a strong sustainability profile. Secondly, that a reputational entity as EUROFIMA uses the Swedish market place for its valued green bond issuance is testament to the fact that the Swedish investors are considered among the most valued and knowledgeable in the market of green bonds. We are extremely pleased that we could match these two sides with such deep sustainability knowledge, making the inaugural EUROFIMA Swedish Krona green bond possible,” says Lars Mac Key, Head of DCM Sustainable Bonds at Danske Bank

    The transaction was a private placement with a few targeted Swedish green bond investors. Investors in the transaction included Skandia and Swedbank Robur. According to the borrower, the net proceeds of the issue of the Green Bonds will be separately earmarked within EUROFIMA’s Treasury system and will be part of the regular Asset-Liability and Treasury activities.

    “Skandia is searching high and low for profitable and climate friendly investments, benefiting both our savers and the planet. Railway is crucial in a climate-smart transport system, and therefore we are very pleased to present this investment,” says Alexander Onica, Head of Fixed income and FX at Skandia

    “Public and goods transport are important to modernize as a central step to achieve the climate goals set in the Paris Agreement. It is also aligned with The European Green Deal’s growth strategy, which aims to make Europe the first climate neutral continent by 2050. To invest in modern railways is a positive and necessary step in a more sustainable direction, since rails is one of the best transport alternatives for people and goods when it comes to reducing Co2 emissions. Rails also helps reducing traffic congestions and road accidents. Swedbank Robur are happy to be part of this transaction. This investment goes very well with our own ambitious climate strategy, where our goals are that all of our managed fund capital should be aligned with the Paris Agreement in 2025, and Co2 neutral in 2040,” says Thomas Bäck Senior Portfolio Manager at Swedbank Robur

    Image by Ioannis Ioannidis 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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