Landshypotek announces SEK 5.25 billion five-year green covered bond

By Sarah Lizee

Olympia, Wash., May 24 – Landshypotek Bank priced a SEK 5.25 billion five-year green covered bond, according to a press release.

The bank said it is the first green covered bond from a Swedish issuer, the largest ever green bond in Swedish krona and the first green bond that exclusively covers sustainable forestry.

The bond gained interest from investors both in and outside Sweden, with the books above SEK 12 billion after only half an hour, the bank said.

The bond was issued under a framework for green bonds that was prepared in line with the Green Bond Principles and is based on sustainable forestry practices, renewable energy and energy-efficient buildings. The framework also received a second opinion from the Center for International Climate Research.

The bond is backed by certified forests or forests with green forest management plans that include setting aside areas of particular conservation value, the bank said.

Properties must have 5% deciduous trees to promote increased diversification, increased biodiversity and storm protection.

The forests are privately owned, and the bond is backed by forest holdings totaling 320,000 hectares. The forests encompass around 1.4% of Sweden’s productive forest and absorb slightly more than 2 million tons of carbon dioxide every year.

Danske Bank was the structuring adviser, and Handelsbanken and Nordea were mandated as joint lead managers for the transaction.

The Stockholm-based bank provides financial services to farmers and foresters in Sweden.

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