Sweden

Expected euro denominated covered bond supply from the Nordic region looks promising with Norway likely to prove a particularly bright spot. However, more cost-effective domestic funding in the Swedish market is expected to depress euro volumes there.

Kommuninvest, the Swedish local government funding agency, is hoping to issue its much delayed debut green bond in euros next year after initial plans to bring the deal this year were put on hold.

This week's scorecard looks at the progress Nordic agencies have made in their 2020 funding programmes in mid-December, with some issuers also setting their targets for 2021.

The Riksbank, Sweden’s central bank, is adding a “negative screening” process to its purchases of corporate bonds under its quantitative easing programme, meaning it will no longer buy the bonds of the most polluting companies.

Italy returned to the private placement market to print one of the year’s largest MTNs on Thursday. The deal stood out this week, since issuance in the market has started to wind down ahead of Christmas.

European banks are running out of ways of selling senior bonds at positive yields. A near-miss from Svenska Handelsbanken this week was enough to convince the market that it’s only a matter of time before an issuer breaks the 0% barrier, write Tyler Davies and Frank Jackman.

Shares in Nordnet rose in the aftermarket after the digital bank began trading on Nasdaq Stockholm on Wednesday, following its Skr9bn (€885m) IPO.

Swedish property company Fastighets AB Balder has tapped the equity capital markets for financing, selling Skr9.44bn (€288m) of fresh stock.

The IPO of Nordnet, the Swedish digital bank and investment management platform, is due to be priced at Skr96, the midpoint of the initial range, when bookbuilding ends on Monday.

Kommuninvest and the Kingdom of Sweden both took to the market this week, pulling off successful trades in a buoyant market.

Sweden set out on Friday how it will apply the EU’s latest capital rules to its banks. Market participants highlighted that the planned changes would give issuers less headroom over the coupon cancellation threshold for their additional tier ones (AT1s).

Stadshypotek on Tuesday became the first Swedish bank to issue a euro benchmark covered bond this year, with its first euro deal secured on Norwegian mortgages. The bond was priced at the tightest spread for any covered bond issued outside the eurozone since May 2019.