NCR observes that the amount of bonds maturing in 2019 by Nordic issuers far exceeds that issued in 2018 and per year since 2015, except in 2017. In all Nordic countries, markets have been affected by falling interest rates helped by several central banks purchase programmes. 60% of the bonds maturing this year have been issued in an environment where funding has been readily available and at a decreasing cost – but NCR believes that this may not be the case going forward.
With large amounts maturing in the next few years, refinancing may present a challenge for some companies. Given the prospect of increasing interest rates, potentially lower demand for government bonds from central banks and lower expectations for global growth, refinancing maturities over the next few years may prove more challenging than over the past five years.
With more demanding investors, perceived risk versus reward may further result in increased differences between companies and institutions the next few years. Data from Stamdata coupled with rating information shows that average current coupons for unrated companies equals that of rated high yield companies.
This commentary reviews bond maturities within the different segments in the four largest countries.
If you have any questions, please contact:
Mille O. Fjeldstad, Analyst, +47 99 03 89 16, mille.fjeldstad@nordiccreditrating.com
Michael Andersson, Chief Rating Officer, + 46 73 232 43 22, michael.andersson@nordiccreditrating.com