Stockholm (NordSIP) – At a time of increasing deglobalisation and rising tariffs businesses need more help than they have in a long time to stay competitive, particularly when society demands they transition into a green economy. Export credit banks, such as the Swedish Export Credit Corporation (SEK), which provides long-term funding for Swedish exporters, their subcontractors and foreign customers, play a crucial role in facilitating the liquidity necessary to help exporters navigate these complex international waters.
SEK’s First Benchmark
To this end, SEK issued a 7-year €500 million green bond at the end of August. This was SEK’s first EUR benchmark transaction in 2024. Funding conditions were characterised as “hard to assess, post-summer EUR market”. The bond was priced at 33 basis points (bps) over mid-swaps.
Bids from more than 60 different investors helped push final orderbooks beyond €1.5 billion. Sectorally, central banks and official institutions were dominant, followed by fund managers, insurance companies and corporates, and banks and bank treasuries took the largest part of the final allocations. Geographically, most of the demand came from Europe, followed by Asia and the US.
“We are extremely satisfied with the successful outcome. The demand from high-quality accounts was strong, and we are happy to have been able to price the transaction 2 bps inside the initial spread indication. This paves the way for our future EUR benchmark transactions, and we are grateful for the support we receive from our global investor base,” says Louise Bergström, Funding & Investor Relations Director at SEK.
SEK’s Green Bond Framework
Eligible funding from SEK’s Green Bond Framework is to be directed to mitigation projects and to adaptation projects.
Mitigation projects “target a reduction in emissions of Greenhouse Gases (GHG) into the atmosphere or absorption of them from the atmosphere”. These projects focus on renewable energy, water and wastewater, energy efficiency, recycling, sustainable construction, resources & environment, sustainable materials and sustainable transport.
Adaptation projects “target the preservation or advancement of adaptive capacity and resilience in order to reduce the vulnerability of human and natural systems due to the impacts of climate changes”
A Well-Timed Deal
Joint lead managers Credit Agricole Corporate & Investment Bank, Deutsche Bank, NatWest and TD Securities helped SEK bring this deal to the market. “An exceptionally well-timed endeavour back into the Euro market, as SEK continues to establish itself in the currency in both green and conventional offerings across the curve,” says James Farrely, Debt Syndicate, Credit Agricole CIB.
“Big congratulations to the SEK team on an impressive return to the EUR market for the first EUR benchmark transaction in 2024. The pricing of 2 bps inside guidance for the EUR 500 million 7-year green transaction is a testament to the strong investor perception SEK has globally. The quality and diversity of the orderbook highlights investor commitment to SEKs ESG activities. We are delighted to have been involved in this transaction,” says Achim Linsenmaier, Vice Chairman of Global Public Sector, Deutsche Bank.
