Sweden

Denmark and Sweden unveiled a number of policies to combat the economic effects of the Covid-19 pandemic this week, with big changes to their funding plans. Sweden has decided to focus on the short end with an increase in treasury bill and commercial paper borrowing, while Denmark has chosen to increase its overall funding programme.

Despite current market turbulence, Kommuninvest, the funding body for Swedish local governments, still plans to press on with its debut euro green bond when volatility abates, according to its head of debt management.

EU supervisors plan to ease the regulatory pressures on banks during the Covid-19 pandemic, allowing them to temporarily breach capital and liquidity buffers to carry on lending to the real economy.

The recent fall in the price of oil is having a knock-on effect on non-core currency issuance. While oil dependent markets could take a hit as their currencies weaken, some net importers could benefit from a stronger currency and safe haven flows.

Vattenfall, the Swedish state power company, issued its second green bond on Thursday, to an enthusiastic reception from investors, who drove the €500m note’s pricing very close to the issuer’s curve.

The first scorecard of 2020 looks at the progress Nordic agencies have made in their funding programmes at the start of March.

Rating: Aa2/AA-/AA

Nordic banks Länsförsäkringar Bank (LF Bank) and Landsbankinn were able to offer “attractive value” in the preferred senior market this week, amid a general hunt for yield among credit investors.

The euro market had no trouble digesting a pair of similar trades from Landesbank Baden-Württemberg (LBBW) and Svenska Handelsbanken this week, with both banks printing non-preferred senior bonds at 58bp and paying a small new issue premium to investors.

SEB found calm conditions in the euro market this week as it paid a small new issue premium to launch a bail-inable senior bond on the back of its recent results announcement.

Swedish PE firm EQT Partners has mandated JP Morgan to advise as it considers divesting its credit business. The strategic shift at EQT is happening as the private credit sector is getting increasingly crowded.

Swedish issuer Kommuninvest is preparing to launch its first deal of 2020 — a five year Swedish krona note.