NIB’s funding strategy is built upon the Bank being a leading USD benchmark issuer, attracting global investors. The aim is to diversify the borrowing into different currencies and markets, including being visible in the environmental bond market.
During 2015, the Bank raised EUR 4.3 billion in new funding through 25 transactions in eleven different currencies. At the end of 2015, outstanding debt totalled EUR 20.9 billion in 18 currencies.
NIB issued two global USD benchmarks during 2015. A three-year, USD 1.25 billion bond was issued in March, and a five-year, USD 1 billion bond in September. Both issues were met with good demand from a diversified group of global investors.
New borrowings in 2015
The USD remained the largest currency, representing 48% of the total funding, followed by EUR with 13%. Equally, both AUD and NZD were well represented, with 10% and 12% as shown in the graph above.
The Bank increased its outstanding volume in AUD during 2015 with a total new issuance of AUD 600 million. At the end of 2015, the total outstanding volume in Australia was AUD 3,500 million in seven different maturities.
In the New Zealand dollar market, the Bank issued a total of NZD 675 million. NIB’s outstanding volume was NZD 2,900 million in six different maturities at the end of 2015.
During 2015, the amount of Nordic currencies issued reached totals of NOK 2,500 million and SEK 1,000 million. In EUR, a total of EUR 574 million was issued, consisting of private placements and a EUR 500 million NIB Environmental Bond (NEB).
The currency distribution of total borrowing outstanding is shown here:
NIB’s new issuance was supported by a broad global investor base in 2015. As in 2014, European investors, including investors from the Nordic countries, were NIB’s biggest investor base with 42%. Investors from Asia, including Japan, accounted for 18%, and investors from Australia and New Zealand bought 12%.
New borrowings in 2015
As in 2014, the most important investor types were banks’ liquidity portfolios, accounting for 35% and central banks and official institutions representing 33%, followed by asset managers with 19%. The rest of the demand was split between pension and insurance funds, corporates and retail investors.