NIB issues SEK 4 billion Response Bond

On 2 April 2020, the Nordic Investment Bank issued a SEK 4 billion NIB Response Bond, due April 2023. The proceeds of the bond will be made available to projects that support NIB’s member countries and sustainable businesses that are facing economic difficulties due to the COVID-19 pandemic. The SEK 4 billion issue is NIB’s largest-ever transaction denominated in Swedish krona. The spread was set at MS+13bsp, and the books closed in excess of SEK 5.2 billon. This is the second Response Bond issued by NIB, and part of the Bank’s efforts to finance investments that support its Nordic–Baltic member countries and businesses in alleviating the economic and social problems caused by the pandemic. Projects that are eligible for financing with Response Bond proceeds include measures to increase the capacity of healthcare services, government expenditures supporting companies in temporary need of subsidization, and medical equipment companies facing increased demand due to the pandemic. “The 3-year SEK 4 billion NIB Response Bond is a testimonial that there is significant support to the serious consequences caused by the COVID-19 pandemic. We are very pleased to see Swedish and international investors responding swiftly in this serious situation. We were able to upsize the deal, based on an order book in excess of SEK 5.0 billion. This is NIB’s second response to the COVID-19 pandemic, following the EUR trade earlier in the week”, says Jens Hellerup, Head of Funding and Investor Relations at NIB. “We would like to express our appreciation of the Nordic Investment Bank and their initiative to ease the economic and social consequences of the pandemic that we are now experiencing. For the Folksam Group, as insurance provider to almost every second Swede, it feels very good to be able to make an investment which will have an immediate beneficial impact for our customers”, says Ylva Wessén, CEO at the Folksam Group. “In these tough times, institutions like the NIB, who through their foundation and hard work have managed to create long term strategic relationships with institutional investors, are essential to secure transfer of funds and raise funding to address lockdown side effects, ensuring that we still have a society where core supply and infrastructure work. At SEB, we are grateful for the trust we have been shown by investors and the NIB to facilitate this transaction”, says Christopher Flensborg, Head of Climate and Sustainable Finance at SEB. “This is a very strong transaction from NIB and the investor response is really a testament of the importance of the work NIB is doing. Producing a Response Bond framework to ensure transparency for what the funds are being used for, I think is helping this process along. I dare to say that the COVID-19 crisis has affected everyone in one way or another, which makes an investment into this bond a real and tangible opportunity for investors. Great to see an issuer and investors come together in the time of crisis like this”, says Linda Lindblad, Head of SSA Origination, Swedbank. In terms of the geographical breakdown, orders were distributed with Swedish investors taking 78%, 11% to Denmark, 6% to Finland, 4% to Czechia and 1% to Latvia. Distribution in terms of type of investors: Banks accounted for 40%, Pension Funds & Insurance 29%, Fund Managers 27%, and Central Banks 4%. See a joint press release on the transaction here. For more information on the use of proceeds, see the NIB Response Bond Framework.

Bond summary terms

Issuer:	Nordic Investment Bank
Rating:	Aaa / AAA by Moody’s / S&P
Issue amount:	SEK 4 billion
Coupon:	0.125%, Annual, Fixed
Launch date:	02 April 2020
Payment date:	09 April 2020
Maturity date:	11 April 2020
Re-offer spread:	MS+13bsp
Joint lead managers:	SEB and Swedbank
ISIN:	XS2154360478

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 Mr Jens Hellerup, Senior Director, Head of Funding and Investor Relations, at +358 961 811 401, jens.hellerup@nib.int