Kommuninvest i Sverige AB, rated AAA/Aaa, issued its second USD benchmark transaction for the year on Thursday. The Swedish local government debt office printed USD 1 billion in 3-year Reg-S/144a notes. The notes, which mature on 1 September 2020, pays a semi-annual coupon of 1.625% and was issued at a spread of 23.35bps over US Treasuries 1.375% due September 2020, equivalent to mid-swaps + 3bps.
The order book exceeded USD1.4bn from just over 45 accounts, primarily central banks & official institutions as well as bank treasuries.
Christian Rangnartz, Head of Debt Management at Kommuninvest, commented:
– We had a stellar outcome in a strong market and the tightest pricing for several years, it was exactly what we hoped to achieve. We are pleased to see such strong investor interest for Swedish local government exposure, and the continued support from our core investor base.
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Kommuninvest is a municipal cooperation for efficient and sustainable financing of housing, infrastructure, schools, hospitals etc. Together, we get better loan terms than each one individually. Since its inception in 1986, the Kommuninvest collaboration has helped lower the local government sector’s borrowing costs by many billion kronor. Currently, 288 municipalities and county councils/regions are members of this voluntary cooperation. With total assets approaching SEK 400 billion (USD ~50 billion), Kommuninvest is the largest lender to the local government sector and the sixth largest credit institution in Sweden. The head office is located in Örebro.
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