Kommuninvest announces decision on strategic funding markets

We have recently decided that the EUR, SEK and USD benchmark bond markets constitute strategic funding markets, both for traditional funding activities and so-called sustainable funding, for example Green Bonds. The decision means that EUR is added as a strategic funding currency. A strategic funding market is defined as one where we intend to be a frequent issuer and have a long-term presence.

Funding in so-called Uridashi format in the Japanese market continues to be prioritized due to its favorable conditions.

We do not provide a forecast regarding expected funding frequency and volume in strategic funding markets; this will be dependent on market conditions. The reference is our base currency SEK, with a priority for markets considered to provide the best conditions for long-term favourable loan terms for our members. The assessment incorporates the functioning of individual markets, including prevailing price dynamics and the supply/demand situation, where we strive for flexibility.

– Given our expectations of Kommuninvest’s continued growth and the need for flexibility, we want to establish another strategic funding market well in advance. The size and liquidity of the EUR market make it a natural choice. In combination with the USD, it gives Kommuninvest access to the world’s two largest and most liquid bond markets, says Christian Ragnartz, Head of Debt Management at Kommuninvest.

We are the largest lender to Swedish municipalities and regions, and have grown rapidly in recent years, due to a stronger market position, additional members and increased municipal investment needs. The latest interim report showed that our lending during the first six months of the year grew by 9 percent to SEK 384.6 billion. This was an increase of SEK 115.7 billion compared to three years earlier.

Our forecast for long-term borrowing in 2019, ie. borrowing with a maturity of more than one year, is SEK 120-140 billion.

 

For further information

Christian Ragnartz
Head of Debt Management
tel: +46 706 073 834
e-mail: christian.ragnartz@kommuninvest.se

Tobias Landström
Deputy Head of Debt Management
tel: +46 70 586 78 51
e-mail: tobias.landstrom@kommuninvest.se

Björn Bergstrand
Head of Media Relations
+46 708 869 476
e-mail: bjorn.bergstrand@kommuninvest.se