Funding breakdown

The objective of KBN's funding operations is to meet growing borrowing requirements in the Norwegian local government sector. This is done through a diversified funding base, effectively achieved by regular issuance of USD and EUR benchmark transactions, a visible presence in other public markets and offering flexibility through private placements. In 2018, KBN issued a total of USD 13 billion via 105 individual transactions in 14 different currencies.

KBN is targeting an estimated total issuance of USD 12-14 billion equivalent in 2019.

Benchmark

KBN is committed to further developing its benchmark strategy by:

  • Strengthening our presence as a recurrent, high quality benchmark borrower.
  • Carefully considering timing period and demand to meet key investor appetite and increasingly widen distribution.
  • Securing performance through fairly-priced, fully book-built transactions and a well managed execution process.
  • Closely co-operating with lead managers to ensure continued secondary support and performance.
  • KBN's current funding requirement allows for 2-3 annual USD benchmark transactions.
  • As a natural continuation of KBN's diversified funding strategy KBN plans to be a regular issuer of EUR benchmarks going forward. KBN has issued 3 EUR denominated benchmarks and will continue to build its curve on this important benchmark market.

Benchmark issuance target: 35-50% of overall funding

 

Retail issuance

  • KBN continually monitors new local markets for opportunities to enrich its funding strategy.
  • A key factor in KBN's success is our flexibility to meet demand for various currencies and tenors and our short response time on new ideas.

Retail issuance target: 5-10% of overall funding

 

Private placements

  • KBN aims to maintain a strong relationship with investors and is accommodative of investor needs for tailor-made private placements.
  • KBN offers a variety of funding products.  KBN is open for maturities from 3 months to 30 years, in bullet and multi-callable structure varieties (max. 15 year maturity for bullets), with a minimum issuance size of USD1m or JPY100m.

PP issuance target: 5-15% of overall funding

 

Institutional niche markets

KBN focuses on strong investor diversification by continuing to nurture its presence in smaller public markets. Our key markets today include:

  • Norway
  • Switzerland
  • Australia
  • New Zealand
  • Canada
  • United Kingdom

Institutional public issuance target: 25-35% of overall funding