Stockholm (NordSIP) – The middle of September saw the Swedish fixed income market shine with three important transactions from large Swedish and Nordic issuers in Swedish krona and Euro.
On September 12th, the Nordic Investment Bank (NIB) issued a SEK2 billion five-year Nordic Environmental Bond (NEB). On the same day, Region Stockholm issued a new SEK300 million five-year floating rate note (FRN) paying 50 basis points (bps) over the 3 month Stibor rate, which was tapped for SEK200 million two days later. Lastly, Kommuninvest, the agency responsible for assisting Swedish subnational public entities with funding, issued a four-year EUR 500 million green bond.
NIB’s bond pays 3.5% coupon and was priced at a 99.613 discount, 9bps over (bps) mid-swaps, to yield 3.586%. Danske Bank and SEB acted as bookrunners on this transaction. “We are pleased to be back to the green bond market in Swedish krona. Looking at the results, it is great to see that not only NIB’s loyal green investor base, but also new investors are keen to invest in our NEBs,” says Jens Hellerup, Head of Funding & Investor Relations at NIB. “This furthers our commitment to financing sustainable projects in the Nordic–Baltic region.” All orders were placed with domestic investors in Sweden. In terms of the investor type, Insurance & Pension Funds took most allocations with 59%, Asset Managers had 39% and the remaining 2% went to Corporates.
Kommuninvest’s bond pays a 3.125% coupon and was priced at a 99.559 discount, to yield 3.24%. Strong demand from 58 investors pushed order books to EUR 1.3 billion allowing the transaction be priced at 8bps below mid-swaps, 2 bps below the level at which books opened. Credit Agricole CIB, Danske Bank, Nomura and TD Securities acted Joint Lead Managers on the transaction. “We are building an increasing presence in the EUR market. Since the beginning of last year, we have issued four green EUR bonds with good results. This is a positive step forward both for our funding and for our sustainability work that contributes to promote the green transition of the municipal sector in Sweden,” says Märta Petrini, Funding manager at Kommuninvest.
Geographically, demand for Kommuninvest’s bond was dominated by Nordics (37%) and the Benelux (22%), followed by Germany-, Austria- and Switzerland-domiciled investors (18%). Investors from the rest of Europe (16%) and from te rest of the world (7%) took the remaining bonds. Sectorally, demand was dominated by banks (43%), followed by central banks and official institutions (41%) and asset managers (16%).