19 Jan 2023

NIB issues its first environmental bond of the year

On 19 January, NIB launched a seven-year EUR 500 million Environmental Bond (NEB). Following NIB’s record high green issuance in 2022, the transaction lays the groundwork for yet another busy year in the sustainable bond market.

The issue highlights the trust investors put in NIB’s Environmental Bond Framework despite the volatility in the market. Building on the strong support for the transaction, the Bank was able to price its first NEB of 2023 at MS -5bps in EUR.

“New issue markets are clearly more difficult to read these days, so making the call on where to put fair value for this environmental bond wasn’t easy. A solid book of almost EUR 1 billion for a EUR 500 million no grow bond shows that we stroke a suitable level for both investors and NIB. The rarity of our issuance in EUR and the NEB format also contributed to the success of this transaction,” says Jens Hellerup, NIB’s Head of Funding and Investor Relations.

“Financing environmental projects is central to NIB’s mandate. NEBs enable us to link this important mandate with the liability side. In 2022, we saw a record demand for loans to environmental projects that are eligible for NEB financing, and we expect this demand to continue or even grow during 2023. It is encouraging to see the ongoing support sustainability focused investors provide to our green transition investments,” comments Kim Skov Jensen, NIB’s Vice President & CFO.

BNP Paribas, Citigroup and Danske Bank were the joint lead managers for this transaction.

“With the support of NIB’s loyal ESG investors, the transaction priced with a minimal concession to fair value and a healthy orderbook oversubscription. Citi was delighted to be part of this successful outcome,” says Ebba Wexler, Managing Director, Head of SSA DCM at Citi.

Overall, more than 30 investors participated in the transaction. In terms of geographical breakdown, investors from France led the orders with 19% of the allocations, Benelux countries took 14%, UK had 13%, investors from Germany and Switzerland took 11%, Americas and Nordics each shared around 10% of the orders, 22% went to the rest of Europe and the remaining 1% to Asian investors.

By investor type, Banks and Asset Managers each took around 37% of the allocations, and the Central Banks and Official Institutions had the remaining 26%.

In accordance with NIB’s Environmental Bond Framework, the proceeds from this transaction will be allocated to selected sustainable projects in the Nordic–Baltic region.

See a joint press release on this NEB issuance

Bond summary terms:
Issuer:Nordic Investment Bank
Rating:Aaa / AAA by Moody’s / S&P
Issue amount:EUR 500 million
Coupon:2.500%, Annual
Launch date:19 January 2023
Payment date:30 January 2023
Maturity date:30 January 2030
Re-offer price:99.260%
Re-offer spread:MS -5 bps
Re-offer yield:2.617% annual
Listing:Nasdaq Helsinki
Joint lead managers:BNP Paribas, Citi, Danske Bank

NIB is an international financial institution owned by eight member countries: Denmark, Estonia, Finland, Iceland, Latvia, Lithuania, Norway and Sweden. The Bank finances private and public projects in and outside the member countries. NIB has the highest possible credit rating, AAA/Aaa, with the leading rating agencies Standard & Poor’s and Moody’s.

For further information, please contact:

Jens Hellerup, Senior Director, Head of Funding and Investor Relations,
at +358 961 811 401, jens.hellerup@nib.int
Angela Brusas, Director, Funding and Investor Relations, at +358 961 811 403, angela.brusas@nib.int
Alexander Ruf, Director, Funding and Investor Relations, at +358 961 811 402, alexander.ruf@nib.int