Ålandsbanken & Borgo – Issue of Covered Bond and Consent Solicitation for Ålandsbanken’s Covered Bond

We advised Ålandsbanken Abp and Borgo AB in respect of Finnish law in the issue of a SEK 5,500,000,000 covered bond by Ålandsbanken Abp as initial issuer and Borgo AB as subsequent issuer.  The terms and conditions of the covered bonds allow covered bonds to be transferred to Borgo AB at a later stage subject to the approval of Ålandsbanken Abp and Borgo AB. The contemplated timing for the transfer s the first half of 2022.

The new covered bond issue is part of a transaction in which Ålandsbanken Abp, ICA Banken AB, Ikano Bank AB (publ), and Söderberg & Partners Holding AB have established a new mortgage company, Borgo AB, and are further establishing a joint mortgage platform on the Swedish market. As part of this transaction, Ålandsbanken Abp will transfer its Swedish mortgage loans, SEK-denominated covered bonds it has issued, and SEK-denominated bonds from its liquidity portfolio to Borgo AB. Borgo AB is a digital start-up mortgage company licenced by the Swedish Financial Supervisory Authority.

In addition to the above, we advised Ålandsbanken Abp in a consent solicitation for its up to SEK 2,500,000,000 covered bond due in 2022 and its later redemption of all outstanding notes pursuant to the amendments made to the terms and conditions of the covered bond during the consent solicitation process.