2021

KOMMUN INVEST I SVERIGE AB

Annual Report

The Annual Report for Kommuninvest i Sverige AB (publ) is presented on pages – On pages - “Kommuninvest” refers to the Kommuninvest Cooperative

Society andor to Kommuninvest i Sverige AB From page  and onwards it refers to Kommuninvest i Sverige AB unless otherwise stated

The Annual Report for the Parent Society the Kommuninvest Cooperative Society is available at wwwkommuninvestorg

INTRODUCTION

Kommuninvest in brief .................................................................................................................................................................................. 

Chairman’s statement

................................................................................................................................................................................... 

President’s statement

............................................................................................................................................................................... 

Our mission

.............................................................................................................................................................................................................. 

SUSTAINABILITY REPORT

Sustainable ﬁnancing is our mission

..................................................................................................................................... 

Sustainable ﬁnancing

................................................................................................................................................................................ 

Responsible operations

.......................................................................................................................................................................... 

Sustainability indicators

........................................................................................................................................................................ 

Auditor’s opinion

BOARD OF DIRECTORS’ REPORT

Business focus ..................................................................................................................................................................................................... 

Local government loan ﬁnancing

.............................................................................................................................................. 

Lending

Funding

Liquidity management

............................................................................................................................................................................ 

Organisation and employees

.......................................................................................................................................................... 

Financial position

............................................................................................................................................................................................. 

Proposed distribution of earnings

........................................................................................................................................... 

Risk and capital management

....................................................................................................................................................... 

Corporate governance report 

....................................................................................................................................... 

FINANCIAL STATEMENTS

Table of contents Financial Statements ......................................................................................................................... 

Income statement and Statement of comprehensive income

........................................................... 

Balance sheet

Statement of changes in equity

................................................................................................................................................... 

Cash ﬂow statement

.................................................................................................................................................................................... 

Notes

Five-Year Summary

...................................................................................................................................................................................... 

Alternative performance measurements

....................................................................................................................... 

Signatures

Audit Report ........................................................................................................................................................................................................... 

Working together

for better terms

Kommuninvest’s role entails oering secure and cost-

eective ﬁnancing to its members and customers

– Swedish municipalities, regions, municipal companies

andother local government actors.

Basic concept

Together municipalities and regions can

borrow more securely and inexpensively than

each of them could individually Together the

local government sector can also increase its

expertise in ﬁnancial management

280

+14

Kommuninvest is owned by

 municipalities and  regions

SEK 461 bn

Lending to members amounted to

SEKbillion at the end of 

Kommuninvest has

the highest possible

credit rating AAAAaa

and a stable outlook

Green Loans

Green Loans were intro-

duced in  for

ﬁnancing environmental

and climate-related

investments Since the

launch the volume of

Green Loans has

increased to

SEK billion

Organisation with clear

division of roles

Kommuninvest comprises two parts

The Kommuninvest Cooperative Society (the

Society) and the credit market company

Kommuninvest i Sverige AB (the Company)

Kommuninvest Cooperative Society

Administrates membership and the joint

andseveral guarantee

The Board of Directors consists of elected

politicians from municipalities and

regions

Kommuninvest i Sverige AB

Conducts the ﬁnancial operations including

funding liquidity management and lending

The Board of Directors consists of individuals

with expertise in areas such aspublic

administration capital markets and busi-

ness development

Our vision

Kommuninvest shall be the world’s best

organisation for local government ﬁnancial

administration We ﬁnance the

development of Sweden’s local and regional

sectors as well as investments for a sound

and sustainable society

Since 

Since its inception in  Kommuninvest

has helped reduce the Swedish local

government sector’s funding expenses by

many billions of kronor Ultimately this has

beneﬁted citizens who have had access to

improved public services at both the local

and regional levels

AAA

Aaa

3Kommuninvest i Sverige AB, company reg. no. 556281–4409Annual Report 2021

KOMMUNINVEST IN BRIEF

Eventful corona

pandemic year

In 2021, Kommuninvest continued to eciently address the corona pan-

demic and its repercussions. Digital and hybrid formats were widely used

for meetings and events. Development was stable in both lending and

funding. Important progress was achieved in the area of sustainability,

particularly with the launch of Social Sustainability Loans. On the regula-

tory side, much eort was invested in advocacy, analysis and preparations

regarding the “risk tax”. Kommuninvest is fully subject to the tax in 2022.

Thereafter, it is the clear intention of the Riksdag (Swedish parliament)

that Kommuninvest should be exempted.

The corona pandemic

The corona pandemic continued to pervade societal

development during . The year began with a high

level of contagion and far-reaching restrictions in Swe-

den and around the world. During the spring and sum-

mer, vaccinations had an increasing impact. Restrictions

were eased and societies opened up. In Sweden, society

returned to some kind of normality. During the autumn,

contagion increased in many areas, causing restrictions

to be reintroduced. In Sweden, this became a reality in

November – December. Thanks to vaccination efforts,

the impact, in terms of the burden on healthcare and

deaths, was less pronounced in this new wave than ear-

lier during the pandemic.

The economic recovery over the year was strong and

mostly stable. Growth gures were high in Sweden and

nearly all over the world. During the recovery phase, the

global economy has been affected by bottlenecks, short-

ages and production disruptions. Among other things,

this has contributed to increased ination and rising

ination expectations. As a result, a number of central

banks have begun a tightening of monetary policy.

Reduced asset purchases and higher policy rates are cur-

rently at the planning stage in many places. In the nan-

cial market, most of the world’s stock markets have

noted signicant gains. There has been some concern

about how a tighter monetary policy could affect market

dynamics. By the end of the year, however, this had not

led to corrections or turbulence to any great extent.

Within the framework of its  programme, the Riks-

bank continued to purchase local government bonds on

a large scale during the year. This action has, by all

accounts, pushed interest rates down and reduced inter-

est rate spreads between Kommuninvest and other local

government issuers. To some extent, this has sharpened

the competitive situation, while not having a more fun-

damental effect where Kommuninvest is concerned.

Over the year, Kommuninvest’s lending grew at a

slightly slower pace than initially forecast. The extensive

central government allocations in connection with the

pandemic have, in combination with the rapid recovery,

created a situation in which many municipalities and

regions have had strong nancial outcomes and muted

funding needs.

Kommuninvest’s funding is adjusted to the lending

trend. With the lending forecast initially being set at 

– billion, the total funding volume for the year

was slightly more than   billion. Funding condi-

Kommuninvest i Sverige AB, company reg. no. 556281–4409Annual Report 2021

KOMMUNINVEST IN BRIEF

tions have been generally favourable. In terms of Kom-

muninvest’s strategic markets, transactions have been

made in  and , where prices have been roughly

equal, but not in , where prices have generally been

worse. In accordance with the procedure initiated in the

spring of , the weekly auctions within the Swedish

Benchmark Programme have continued to generate

favourable results. In September, a new issue was, for the

rst time, implemented within the framework of this

auction procedure.

In , Kommuninvest achieved signicant progress

in its sustainability work. Green nancing has continued

to grow steadily. Based on disbursed volume, the share

of Green Loans has increased in relation to total lending,

and was approximately  percent at the end of the year.

In May, Kommuninvest received the environmental tar-

gets award Miljömålspriset  from the Swedish

Environmental Protection Agency, for its contribution to

achieving the environmental objective of limited climate

impact. This provided important recognition of the good

results achieved by the green nancing programme.

After thorough preparations and a successful pilot

phase, Social Sustainability Loans were launched for all

members in March. This innovative loan product is for

municipalities and regions, as well as their companies,

seeking to strengthen their investments in social sustain-

ability and make them visible. An active process, involv-

ing discussions and an exchange of knowledge, has been

conducted to generate awareness of the product and its

possibilities. At the end of the year, seven customers,

including the ve pilot customers, had been granted

loans for a total of   million.

Over the year, Kommuninvest developed the support

offered to customers/members in making nancial deci-

sions. This has occurred in close dialogue with custom-

ers/members and relevant organisations. The materials,

including reports and analysis tools, and the advisory

services have been strengthened in four areas. These

address owning or leasing operational premises, guaran-

tee fees, governance in nancial balance and liquidity

planning.

The Welfare Economists – the independent group of

experts established by Kommuninvest to analyse the

local government sector economy in the wake of the

pandemic – published two new reports during the

spring. The group has particularly emphasised the

importance of applying systematic streamlining (by

means of digitalisation and new working methods, for

5Kommuninvest i Sverige AB, company reg. no. 556281–4409Annual Report 2021

KOMMUNINVEST IN BRIEF

example) to build long-term sustainability into the

nances of Swedish municipalities and regions.

Kommuninvest’s operations have continuously been

adapted to the varying conditions caused by the pan-

demic and the restrictions. Besides a period in October

and November, during which there was a high level of

attendance at the ofce, employees have worked from

home to a fairly large extent. Opportunities for hybrid

meetings have been strengthened, with participants

attending both physically and online. All major events,

including the regular member consultations in January,

the Annual General Meeting of the Society in April, the

Finance Forum in September – October and additional

member consultations regarding the risk tax in October,

have been conducted in digital format. In general, this

exible and somewhat complex approach has worked

well, despite the challenges. Operations have continued

at full capacity.

Risk tax

In September , the central government presented

aproposal for a so-called risk tax for banks and other

credit institutes. This was updated in late May .

Thedesign entails the tax applying fully to Kommun-

invest. In an active advocacy process that included

formulating consultation responses jointly with The

Swedish Association of Local Authorities and Regions

(), as well as numerous other initiatives – Kom-

muninvest has opposed the tax being applicable to local

government partnerships. Because Kommuninvest is

guaranteed by its members, providing loans only to

members and their companies, its operations do not

entail the type of risk to the external community cited

bythe government as its motive for the tax.

On  December, the Riksdag voted to approve the

government bill. Accordingly, the risk tax was intro-

duced as of  January . The Riksdag’s assent was,

however, accompanied by three announcements. The

rst of these concerned local government partnerships.

The Riksdag held that the government should return to

the matter, by  October  at the latest, with a pro-

posal to the effect that Kommuninvest would no longer

be subject to the tax as of  January . The Riksdag

also held that the government should, as soon as possi-

ble, present a proposal for compensating the local gov-

ernment sector for the additional expense entailed by the

temporary taxation of local government cooperation

through Kommuninvest.

Kommuninvest has conducted extensive analysis and

preparations with the purpose of ensuring that the oper-

ations are able to manage the risk tax to the extent nec-

essary. The views of the members were sought at the

additional member consultations on the matter arranged

in October. A key component in the overall solution was

a programme of restructuring for both the Company

and the Society, focused on lowering the Group’s cost

level (excluding the risk tax) through efciency enhance-

ments and savings. A fundamental principle was that the

programmes should primarily comprise measures that

would be important or necessary for Kommuninvest to

implement, even if it would not be affected by the risk

tax. Implementation of the programmes commenced

inNovember.

6 Kommuninvest i Sverige AB, company reg. no. 556281–4409Annual Report 2021

KOMMUNINVEST IN BRIEF

Private Placement  () 

Multi-year summary Kommuninvest i Sverige AB

    

Balance sheet total SEK billion     

Lending (recognised value) SEK billion     

Net proﬁt SEK million      

Members total     

of which municipalities     

of which regions     

Core Tier I capital ratio      

Tier I capital ratio      

Total capital ratio      

Leverage ratio      

Green Bonds  () 

Swedish commercial paper programme  () 

Uridashi  () 

Bank loans – () 

ECP Euro-Commercial Paper

Programme  () 

Swedish

Benchmark

Programme

 () 

Benchmark funding

other currencies

 () 

FUNDING PORTFOLIO

BY PROGRAMME

MARKET SHARES

LOCAL GOVERNMENT LOAN FINANCING



Funding via

Kommuninvest

 () 

Bank funding

 () 

Funding through

proprietary

funding

programmes

() 

Municipalities



 () 

Municipal

housing

companies

() 

Other munic-

ipal compa-

nies

 () 

Municipal

energy companies

 () 

Regions

 () 

LENDING PORTFOLIO

BY BORROWER CATEGORY

1) Forecast regarding outstanding funding (ﬁgures in brackets refer to actual

outstanding funding in accordance with members’ own Annual Reports as

per31December 2020).

All charts refer to 31 December 2021. Figures in parentheses refer to 31 December 2020.

2) Some lending to municipalities is on-lent to municipal

companies through municipal internal banks.

7Kommuninvest i Sverige AB, company reg. no. 556281–4409Annual Report 2021

KOMMUNINVEST IN BRIEF

Accelerated development

provides stability, strength

and sustainability

Despite 2021 being a tough year, with challenges surrounding both the corona

pandemic and the risk tax, we were able to accelerate the development of

Kommuninvest’s operations. We increased our digital capacity, created a for-

ward-looking eciency agenda and achieved useful advances in sustainability

and consulting. There is a “creative resilience” in the organisation that safeguards

stability andstrength in all situations.

Two major challenges pervaded . One

involved maintaining a steady course through

new phases of the corona pandemic. In particu-

lar, the process of securing efcient operations

in digital and hybrid formats had to be contin-

ued. The second concerned the risk tax for

banks and other credit institutions, which was

introduced following the end of the year. In par-

allel with active advocacy efforts, it was neces-

sary to develop a solid package of measures for

the organisation to be able to handle an addi-

tional tax cost that could exceed existing oper-

ating expenses.

We tackled these challenges in a pragmatic

and vigorous manner. A principal tenet in Kom-

muninvest’s culture is to do what must be done

to provide the optimum solution for customers

and members at every opportunity. This makes

for a “creative resilience” that has often proven

highly benecial.

This is what led us to achieve signicant pro-

gress in strengthening our digital capacity. We

pursued aggressive development processes even

when almost the entire organisation was work-

ing remotely. We built up a strong capacity for

hybrid meetings and working methods. We con-

ducted larger events in highly effective digital

formats.

This also allowed us to take advantage of the

challenge presented by the risk tax to accelerate

Kommuninvest’s development on a broader

front. The package of measures to address the

risk tax includes an efciency improvement

schedule that would have been essential even

without the tax. With increased standardisation

and automation, and by focusing on implement-

ing new approaches, we will become even more

efcient in our role as the local government sec-

tor’s leading lender.

The introduction of the risk tax without local

government partnership being exempt was dis-

appointing. Having established that we are a

low-risk institution fostering key welfare invest-

ments, it was, however, positive that the Riks-

dag (Swedish parliament) very clearly

expressed the opinion that Kommuninvest

should be exempt from  January . That

would make Kommuninvest subject to the tax

for only one year. We expect the government to

take the steps necessary for this to happen.

Progress in sustainability and consulting

In addition to the corona pandemic and risk tax,

we also made progress in the area of sustainabil-

ity. We strengthened our general governance and

capacity in sustainability. We continued to

develop our leading role in green nancing. The

total number of investment projects for which

Green Loans were granted passed the  mark

in number. These projects exceed   billion

in total value and are distributed over more than

 municipalities and regions. Receiving the

environmental award, Miljömålspriset, for the

green programme’s contribution to climate

There is a

“ creative

resilience” in

theorganisation

that safeguards

stability and

strength in all

situations.

8 Kommuninvest i Sverige AB, company reg. no. 556281–4409Annual Report 2021

CHAIRMAN’S STATEMENT

work, was a positive recognition of the local

government sector’s strong efforts in this area. In

March, Social Sustainability Loans were

launched for allcustomers/members. This inno-

vative loan product, established based on mem-

bers’ demand, broadens our sustainability

efforts

and affords us a leading position in the devel-

opment of a relatively new form of nancing.

Another active path of development over

theyear involved strengthening the support

innancial decisions that we offer customers/

members. This work has been conducted in

close dialogue with customers/members and

relevant organisations. The materials, including

reports and analysis tools, as well as the advi-

sory services, have been upgraded in four key

current areas within the framework of the local

government sector’s nancial management.

Stability and strength

I am impressed by the constructive adaptability

of everyone working at Kommuninvest. It was

not an easy year. But thanks to this “creative

resilience”, the operations nonetheless achieved

progress through their stability and strength.

This bodes well for the future.

Kommun invest i Sverige AB

Ellen Bramness Arvidsson

Chairman

Kommuninvest i Sverige AB, company reg. no. 556281–4409Annual Report 2021

Steady and

sustainable growth

During a corona pandemic year in which the local government sector’s ﬁnances

showed evident strength, Kommuninvest’s lending continued to grow stably,

albeit ataslower pace than previously. Substantial progress was made in the area

ofsustainability, particularly with the launch of Social Sustainability Loans.

Extensive preparations were made to address the new risk tax, including

focusing on forward-looking eciencies.

Another year deﬁned by the corona pandemic

The year  was another dened by the

corona pandemic. Despite the challenges, there

was a tangible strength in the local government

sector economy. This was in part caused by

extensive central government allocations in

connection with the pandemic. Another was the

robust macroeconomic recovery around the

world.

In this context, Kommuninvest’s lending con-

tinued to grow, although not at the high pace to

which we have become accustomed in recent

years. The sector’s nancial strength, with

increased liquidity, had a restraining effect on

members’ funding needs. The Riksbank’s pur-

chases of local government bonds within the 

programme also played a certain role. The inter-

est rate discrepancies between different asset

classes remained compressed, making local gov-

ernment collaboration through Kommuninvest

less advantageous, compared with individual

local government issuers. Although this has no

fundamental impact on Kommuninvest’s busi-

ness model, it is not optimal in the long run.

Kommuninvest’s operations were affected to

only a limited extent by the pandemic. Even with

substantial digital and hybrid working methods,

the organisation worked at full capacity. In the

long term, creativity and corporate culture can

be negatively affected by fewer physical meet-

ings and contacts. In the short term, however,

such challenges can be dealt with.

Good progress

A clear indication that the operations achieved

good progress was the launch of Social Sustain-

ability Loans. This new loan product, which

broadens our sustainability work, has been

developed in close dialogue with a number of

customers/members with specic interests in

this area.

At the same time, green nancing continued

to grow. In April, we received the  environ-

mental targets award, Miljömålspriset, for our

contribution in achieving the environmental

objective of limited climate impact. This pro-

vided important recognition of the local govern-

ment sector’s impressive efforts in the green

transition.

Another favourable path of development was

our strengthening of the support in nancial

decisions – in the form of reports, calculation

tools and advice, for example – that we offer

our customers/members.

Addressing the risk tax

During the year, we conducted extensive efforts

to address the Government’s proposed risk tax

for banks and other credit institutions. In part,

and as part of a broad collaboration in the local

government sector, we championed an advocacy

process seeking an exemption for local govern-

ment partnerships through Kommuninvest. And,

in part, through analysis, preparation and dia-

logue, we developed a package of measures to be

able to manage the tax within the organisation.

The Riksdag’s (Swedish parliament) approval

of the government bill in December was a set-

back – the risk tax thus becoming a reality with-

out our being exempt. This will be a heavy bur-

den for local government partnerships in .

On the other hand, a victory was achieved when

the Riksdag also stated its opinion that local

government partnerships should no longer be

In April, we

received the 2021

environmental

targets award,

Miljömålspriset,

for our contribu-

tion in achieving

the environmental

objective of

limited climate

impact. This pro-

vided important

recognition of the

local government

sector’s impres-

sive eorts in the

green transition.

10 Kommuninvest i Sverige AB, company reg. no. 556281–4409Annual Report 2021

PRESIDENT’S STATEMENT

subject to the tax as of  January  and that

the local government sector should be compen-

sated for the additional expense in . We

now expect the government to deliver on this

announcement.

Given that the risk tax, according to the Riks-

dag’s thinking, will only affect Kommuninvest

for one year, we are planning a balanced mix of

measures. We will be focusing on key efcien-

cies that are crucial even independent of the tax.

We are now intensifying our efforts to build an

even sharper organisation.

Net proﬁt

The operating prot for the year,   mil-

lion, was higher than expected. This is partly

due to unrealised changes in market values

turning out to be favourable at   million,

and to a higher return on the management of

our liquidity reserve. At   million, our

operating income was, however, lower than pre-

vious years. This follows the resolutions taken

by the  Annual General Meetings and is in

line with what we strive for in the long term. In

accordance with these decisions, asmaller mar-

gin between funding and lending is intended to

bring lower prices and less operating income.

Employees of the highest standard

Over the year, our colleagues have faced double

challenges: the corona pandemic and the risk

tax. Andthey have done so with great spirit. I

am extremely grateful for their excellent perfor-

mance and amazing commitment. Their efforts

are what made the year now concluded such

agood one.

Kommun invest i Sverige 

Tomas Werngren

President and CEO

Kommuninvest i Sverige AB, company reg. no. 556281–4409Annual Report 2021

Through our lending, we provide conditions for Swedish

municipalities and regions to invest cost-efciently in wel-

fare. Since the nancial crisis in –, Kommunin-

vest’s share of the local government sector’s funding has

increased sharply. Today, we account for more than half of

total loan debt. The explanation is that an increasing number

of municipalities and regions have joined as members, and

that our growing economies of scale and regulatory devel-

opment have made it increasingly difcult for banks and

other nancial institutions to compete with our favourable

credit terms.

1. Funding

Kommuninvest continuously raises funds both in Sweden

and in the international capital market. The local govern-

ment sector’s inherent stability, combined with our members’

joint and several guarantee of Kommuninvest’s commit-

ments, means our funding is regarded as highly secure.

From a credit risk perspective, Kommuninvest’s funding is

regarded as equivalent to the Swedish central government’s

own funding. The low risk, combined with Kommuninvest’s

history and good reputation in the capital market, affords us

access to nanciers who generally lend to us on favourable

terms. To be able to meet our members’ credit requirements,

even when the markets are uneasy, we always maintain

surplus liquidity in reserve.

2. Loan application and credit check

When one of Kommuninvest’s customers decides to borrow

money for one or more investments, the municipality or the

region contacts Kommuninvest to apply for a loan. Nor-

mally, our lending is not linked to any specic purpose and

borrowers need not, in accordance with the Swedish princi-

ple of municipal self-government, report what the money

will be used for.

Since we know our members well, we generally have

agood knowledge of their nancial situation. We provide

credit based on lending frameworks and credit decisions.

Thelending limits determine how much we can lend to the

relevant municipal/regional group before an in-depth analy-

sis needs to be carried out. These should not be seen as xed

long-term ceilings, but are part of a continuous and active

analysis process. Credit decisions are to be kept within

theselimits.

3. Green Loans and Social Sustainability Loans

Kommuninvest runs two sustainable nancing programmes.

These are designed to foster local and regional sustainability

efforts. Green Loans are provided for environmental and cli-

mate initiatives, while Social Sustainability Loans are pro-

vided for social initiatives. For municipalities and regions to

be granted loans within these programmes, the investment

projects concerned must meet predetermined criteria and be

included in one of the dened categories. Loan applications

are examined by the Environment Committee or the Social

Sustainability Committee, as relevant. In turn, Kommunin-

vest’s sustainable lending is nanced by issuing special bonds

that are acquired by Swedish and international investors. To

date, a large number of Green Bonds have been issued. Social

bonds will be issued when the volume in the programme has

grown sufciently large.

4. Disbursement of loans

Because we know our members well and apply a fast, ef-

cient and highly digitalised credit process, it takes only

ashort time between the customer’s initiative and the dis-

bursement of the loan. Whether it concerns a Green Loan or

a Social Sustainability Loan, we handle the specic adminis-

tration and documentation required to operate sustainable

nancing programmes – such as for external review and for

the reporting of the impact to investors.

5–6. Advice and debt management through KI Finans

Throughout the term of the loan, the borrower is in continu-

ous contact with our nancial advisers and has access to all

of Kommuninvest’s combined expertise. In the web-based

nancial management service  Finans, customers’ nance

ofcers have access to transaction management, analysis and

reporting of liabilities and assets.

How Kommuninvest

helps build welfare

Kommuninvest ﬁnances most of the Swedish local government sector’s

investments in, for example, housing, schools, homes for the elderly,

swimming baths and infrastructure.

12 Kommuninvest i Sverige AB, company reg. no. 556281–4409Annual Report 2021

OUR MISSION

Investment needs

Through continuous funding on the capital market,

Kommuninvest is always able to lend money to

munici palities and regions. When a municipality or

region has estimated the expense of the investment/

investments, an application is submitted for a loan

from Kommuninvest. If an investment project contrib-

utes to a favourable impact on sustainability, a Green

Loan or Social Sustainability Loan may be relevant.



Funding



Disbursement

of loans



Advisory

service

KI Finans



Green Loans

and Social

Sustainability

Loans are approved

by the relevant

committees

–

Dialogue with a

ﬁnancial adviser on

a loan application

and the opportunity

to borrow sus-

tainably



Continuous

debt management

through KI Finans

13Kommuninvest i Sverige AB, company reg. no. 556281–4409Annual Report 2021

OUR MISSION

Sustainable ﬁnancing

is our mission

Kommuninvest’s basic concept and vision includes encouraging social development that is

sustainable in the long term. The sustainable ﬁnancing solutions that Kommuninvest oers

foster ecient use of tax revenues, ﬁnancial stability and the local government sector’s work

with Agenda 2030. The partnership that Kommuninvest represents encompasses 97 percent

ofSwedish municipalities.

The municipalities and regions form the foundation of the

Swedish welfare state. It is under their management that citi-

zens encounter the most central welfare services, including

healthcare, education and residential care. They also play

acentral role in the basic social infrastructure, in the form

ofhousing, energy supply, public transport, water/sewerage,

etc. Local government actors play a key role in advancing

Swedish efforts towards Agenda , in terms of both

environmental change and societal issues.

How we generate sustainable values

Through lending to municipalities and regions, Kommunin-

vest establishes conditions for the expansion of Swedish wel-

fare, increases the stability of local government nances and

contributes to a more sustainable Sweden. By bringing local

government funding needs together and channelling them

through a single organisation, economies of scale can be

achieved, while keeping operating expenses down. Accord-

ingly, Kommuninvest plays a similar role for the local gov-

ernment sector as the National Debt Ofce does for the

central government and its authorities.

As the largest lender to the sector by far, Kommuninvest

helps generate both direct and indirect values. Crucially, the

nancing solutions and the knowledge and debt manage-

ment tools we provide benet nancial stability in Swedish

municipalities and regions and help develop members’ debt

management expertise. Accordingly, essential investments in

welfare and sustainability can be made more efciently and

at a lower cost to taxpayers. This strengthens the welfare

society by providing new or refurbished homes for the

elderly, schools, apartments and healthcare facilities,

or various forms of infrastructure such as roads, public

transport, energy, water/sewerage.

Partnership strengthened during corona pandemic

The corona pandemic of recent years has entailed an extraor-

dinary strain on municipal and regional operations – for this

reason, Kommuninvest’s support of the sector in the chal-

lenges it has faced has been particularly important. Kom-

muninvest has above all maintained continued access to the

capital market and was able to nance municipalities’ and

regions’ funding needs on favourable terms. We have also

intensied our knowledge-based support in the form of

research and focus reports that in various ways foster effec-

tive governance and long-term management. For example,

the Welfare Economists expert group, launched in , is

behind four reports, including a handbook on efciency.

Given that the local government welfare mission and long-

term economic sustainability are being challenged by demo-

graphic developments, with an increasing proportion of

older people, alongside continuing substantial investment

needs, it remains crucial for the sector to maintain favoura-

ble nancing and support in effective debt management.

During the year, the municipalities of Täby and Danderyd

became members of the Society, meaning that  of

Sweden’s  municipalities are now members.

A non-proﬁt concept that beneﬁts society

Kommuninvest is established as a cooperative concept whose

operations have no vested interest in generating a prot and

are to be characterised by as low a level of risk-taking as pos-

sible. Accrued prot is returned to the members of the Soci-

ety in the form of interest on their contribution capital and

asrefunds on their business volumes. In ,  .

(.) million was transferred. In recent years, prots have

decreased following a decision by the members in  to

change the pricing model, entailing a reduction in the prices

offered by Kommuninvest.

Towards more complete integration of sustainability

It is becoming increasingly clear that the nancial market can

inuence the transition to more sustainable societies. In ,

the regulatory consequences of the action plan for nancing

sustainable growth launched by the  in  have begun to

take shape in earnest. The action plan aims to direct capital

towards sustainable investments, to manage nancial risks

caused by climate change, environmental degradation and

social vulnerability, and to promote transparency and a long-

term perspective in nancial and economic activities. During

the year, the Company commenced a process to be able to

meet the mandatory and voluntary regulations that are

planned, including a new directive for sustainability

reporting, new requirements for regulatory reporting and

avoluntary European standard for Green Bonds.

Kommuninvest i Sverige AB, company reg. no. 556281–4409Annual Report 2021

SUSTAINABILITY REPORT

461

SEK bn

Of which  percent are Green Loans

Lending

Helps to meet

Sweden’s

sustainability

targets.

2,375

users of

KI Finans

Helps all of

Sweden live.

Creates stable ﬁnances

in municipalities and

regions.

Contributes to the

general build-up of

welfare in Sweden.

197.8

SEK million in total

distribution of surplus



) Amount disbursed in  relating to the  ﬁnancial year

Number of members Kommuninvest’s

market share 

Kommuninvest’s share of local government funding

2014 2017 2020

The compilation refers to Kommuninvest’s share of funding among all

ofSweden’s municipalities, including both members and non-members.

Most of the municipalities with no funding from Kommuninvest are

non-members, meaning they are not entitled to raise loans from

Kommuninvest. Ofthe 13 municipalities that had no funding from

Kommuninvest in 2019, 12were non-members. Data for 2021 were not avail-

able at the time of publication.

 – – – 

SUSTAINABILITY REPORT

Kommuninvest i Sverige AB, company reg. no. 556281–4409Annual Report 2021

Our view on sustainability builds on the values of the Swed-

ish local government sector, and actions are conducted in

accordance with the Local Government Act and other legis-

lation. It is therefore consistent with the international frame-

work of the  Fundamental Conventions, the  Guide-

lines for Multinational Enterprises, the  Guiding Principles

on Business and Human Rights, and the  Global Compact.

Financing, knowledge, responsibility

By providing efcient nancing of investments for Sweden’s

municipalities and regions, we contribute to sustainable wel-

fare over the long term. A strong ownership structure and the

joint and several guarantee allow us to raise capital in the

nancial market cost-efciently and stably. The members’

considerable investment needs and Kommuninvest’s posi-

tion, being responsible for a sizeable proportion of members’

funding, generate economies of scale.

We support our members’ sustainability work with nanc-

ing products clearly focused on environmental and social

sustainability. Since their launch in , Kommuninvest’s

green nancing programme has grown to become one of the

largest in the Nordic region. Since , a new product has

been offered, Social Sustainability Loans, aimed specically

at fostering systematic work with social initiatives.

We are also working to build knowledge on debt manage-

ment, as part of good nancial management in the sector.

Byextension, this should give elected representatives optimal

room for manoeuvre in delivering welfare services to citizens.

We have, for example, undertaken special efforts to improve

awareness regarding whether municipalities and regions

should own or rent their operational premises. Given its role

in society, it is crucial that Kommuninvest be governed

clearly to ensure the operations are conducted responsibly.

Stakeholder dialogue

We maintain a continuous dialogue with those stakeholders

who, in various ways, inuence and are affected by our oper-

ations, to identify the sustainability issues with which the

Group should work. Our dialogue with stakeholders

involves meetings with members, customers and employee

delegates, as well as with representatives of government

ministries and national authorities. We also conduct surveys

among key stakeholders on an ongoing basis, including

members, customers, employees and investors, both more

traditional satisfaction surveys as well as more distinct sus-

tainability surveys.

Swedish municipalities and regions are our most impor-

tant stakeholder group. As members, they own and govern

our operations, although, when they choose to borrow from

us, they are also our customers. The dialogue with munici-

palities and regions in their role as members is mainly con-

ducted with elected politicians. The dialogue with municipal-

ities and regions in their role as customers is conducted

mainly with local government ofcials, generally with spe-

cialists in economics and nance.

Governance of sustainability work

The Sustainability Manager is responsible for managing,

developing and reviewing Kommuninvest’s sustainability

work in close cooperation with the Executive Management

Team and the department heads, who are responsible for tak-

ing sustainability aspects into account within their respective

areas of responsibility. Guidelines for sustainability work are

detailed in a Sustainability Policy adopted by the Company’s

Board of Directors, and are further specied in supplemen-

tary policies and instructions relating to occupational and

personal safety, conicts of interest,  security, equality and

diversity, bribery and hospitality, and regulatory compliance.

Sustainability work is reported annually to the Board, and is

supplemented by reviews on topical themes.

Sustainability risks

Sustainability risk is the risk that Kommuninvest’s opera-

tions will directly or indirectly affect their surroundings neg-

atively in terms of business ethics and corruption, including

money laundering and terrorism nancing, climate and envi-

ronment, as well as human rights, including working condi-

tions. The actions taken to address sustainability risks are

largely governed by national and international regulations

and guidelines alongside the Society’s Ownership Directive,

internal instructions and policies.

One of the most signicant sustainability risks is associated

with trust, due to insufcient control and requirements in

terms of environmental, social and governance () criteria

among borrowers and counterparties. As a rst step, the

Company has begun to introduce sustainability risks ()

aspart of the assessment of municipalities in connection

with a special review and in connection with the testing of

the lending framework. This work is complex, given the local

government sector’s broad societal mission, and is expected

to intensify in the upcoming years.

Given the Group’s organisational and basic structure,

including the members’ joint and several guarantee for the

Group’s liabilities, that all lending is zero risk weighted and

that primary and secondary local government authorities

cannot be declared bankrupt, the nancial exposure to

sustainability-related risk is highly limited.

Sustainability work

Our sustainability work builds on the expectations of our stakeholders and on our mission

to ﬁnance local government development and investment for a beneﬁcial and sustainable

society. The ambition is to integrate sustainability throughout our operations.

SUSTAINABILITY REPORT

Kommuninvest i Sverige AB, company reg. no. 556281–4409Annual Report 2021

Our sustainability perspectives

Sustainability work builds on three perspectives

Sustainable ﬁnancing

Supporting municipalities and regions’ eorts in ﬁnancial

environmental and social sustainability as well as in

fostering stability

Responsible operations

Ensuring that Kommuninvest complies with its Code of

Conduct the expectations of stakeholders as well as with

laws rules and regulations

Sustainable organisation

Fostering a good working environment and employee

health good management employee collaboration and

anagile organisation

Which global goals are most clearly connected?

Sustainable ﬁnancing

Responsible operations

Sustainable organisation

Our inﬂuence is both direct (within the Company’s decision-making man-

date) and indirect (in the case of lending funding and other balance sheet

items) A mapping conducted in  shows that the Group has a direct or

indirect impact on  of the  global goals and on about  of the 

sub-goals The goals most clearly connected are presented here

Responsible

operations

Sustainable

organisation

Sustainable

ﬁnancing

SUSTAINABILITY REPORT

Kommuninvest i Sverige AB, company reg. no. 556281–4409Annual Report 2021

Our contribution in sustainable nancing involves cost-

effective and stable nancing of public investments, products

capable of promoting sustainable realignment, and long-term

analysis for sustainable local government nances. The work

also focuses on enhancing the skills of our members and cus-

tomers in sustainable nancial management, and offering

tools that improve internal decision-making processes.

Comprehensive digitalisation

Lending forms the foundation of our operations. To be able

to offer stable nancing at the right price, it must continu-

ously be streamlined in accordance with the needs of custom-

ers and members. Since , the  Låna lending process

has essentially been entirely paper-free, even for the customer

thanks to digital signing. This increases exibility and

reduces administration for customers while freeing up

resources in the Company for more qualied customer

support and strategic conversations.

At the same time, as a result of the corona pandemic, cus-

tomer and investor meetings have increasingly been held

online, with physical meetings now essentially only being

held for special reasons. The more aggressive process of digi-

talisation also includes the events and seminars that Kom-

muninvest arranges, with these changes possibly becoming

fully or partly permanent following the pandemic.

There are clear advantages for a membership organisation

spread throughout the country to handle interaction and dia-

logue through digital formats to a relatively high degree.

Many members perceive not having to travel as an advan-

tage. During the year, the Company continued to invest in

technology to enable smooth digital and hybrid meetings.

With  Finans, Kommuninvest also offers a web-based

nancial management service for transaction management,

analysis and reporting of nancial liabilities and assets. All

members of the Society have access to the service, which had

more than , (,) users at the end of .

Sustainable ﬁnancing programmes

Since  and , respectively, Kommuninvest has been

operating two sustainable nancing programmes, both of

which are designed to foster local and regional sustainability

efforts. Environmental and climate initiatives, as well as

social initiatives are nanced either through Green Loans or

Social Sustainability Loans – loans which are then renanced

by issuing bonds for which pension and mutual fund compa-

nies, for example, are the buyers. Kommuninvest is one of

the Nordic region’s largest issuers of Green Bonds and its

ambition is to issue its rst Social Bond as soon as the under-

lying loan volume is sufciently large.

During the year, the milestone of  projects approved for

Green Loans was passed, and Kommuninvest also received

the Swedish Environmental Protection Agency’s environmen-

tal targets award, Miljömålspriset, for its efforts with this

programme. New policies were also adopted regarding the

two programmes, entailing decisions to appoint members of

the expert committees attached to the programmes, as well as

the instructions given to the committees, being made by the

Board of Directors of the Company. To safeguard a high

degree of integrity and expertise in the committees, they

include representatives from universities and state research

institutes as well as local and regional expertise.

Catalyst for further-development of impact measures

The Green and Social nancing programmes both promote

increased measurement of their effects on society, that is, fol-

lowing up and assessing the investment contribution from

asustainability perspective. Financing is conditional on

requirements for both transparency and feedback. For Green

Loans, the impact generally involves reducing or avoiding 



emissions, adapting to climate change or other environmental

benets. For Social Sustainability Loans, it may be amatter of

increased security, increased participation, improved school

results or increased employment. Contributing to a develop-

ment results in improved governance, follow-up and assess-

ment, as well as an increased focus on sustainable investments

closely complements Kommuninvest’s basic concept.

The expected annual reduction of 



emissions and other

environmental benets from investment projects nanced

with Green Loans can be seen in Kommuninvest Green Bonds

Impact Report. The principles for reporting are based on the

Nordic co-operation initiated by Kommuninvest in this area,

the Nordic Position Paper on Green Bonds Impact Reporting,

which has been updated and published on three occasions.

Standard for impact measures for social initiatives

Impact measures for social initiatives, that is, analysis of the

signicance of such efforts in achieving predened social

objectives, is an area in which a common terminology and

amore harmonised approach are sought. Accordingly, Kom-

muninvest participates in the technical committee for stand-

Sustainable ﬁnancing

Kommuninvest oers ﬁnancial services and products that support the work of the

municipalities and regions regarding good ﬁnancial management and sustainable

development. This provides conditions for tax funds to be used as eciently as possible,

toincrease the stability of the ﬁnancial system and to promote the local government

sector’s sustainability work.

SUSTAINABILITY REPORT

Kommuninvest i Sverige AB, company reg. no. 556281–4409Annual Report 2021