Kontio will take on the new responsibilities on May 1st, 2018. He will, for the time being, also continue as the Head of Corporate Responsibility.
Antti Kontio (born 1984, M.Sc. Econ) joined MuniFin in 2008 and has worked in the funding team since 2009.
MuniFin was the winner in the categories of Green Bond of the Year (SSA) and Biggest issuer (local authority).
The winners were not decided by Environmental Finance but by a panel of judges made up of some of the biggest green bond investors.
The second-ever green bond in the history of MuniFin, set at EUR 500 million and issued in September, was oversubscribed six times within the first hour.
The transaction was the most sought after bond in the history of MuniFin, and the bond was very tightly priced. The loan continues to be in demand in the secondary markets, and it has had a positive effect on the valuation level of all MuniFin’s euro-denominated benchmark bonds.
2017 saw also the issue of MuniFin’s inaugural privately placed green mond. The subscriber of the AUD-denominated private placement was the Japanese life insurance company Fukoku Life.
Green finance, earmarked for environmental projects, was first launched for MuniFin’s customers in 2016. In the same year, MuniFin issued its first green bond, subsequently also the first green bond issued by a Finnish credit institution.
The customer demand for green finance has been a positive surprise. The green finance project portfolio reached a milestone by exceeding one billion euros at the turn of the year.
The effectiveness of a green project is especially evaluated through energy-efficiency and reduced carbon dioxide emissions, but indirect effects are also taken into account. A more detailed evaluation of the effects of green financing is available in separate reports, published annually.
See all Environmental Finance’s Green Bond Awards winners >
Antti Kontio, Head of CSR, MuniFin
tel. +358 50 3700 285, antti.kontio(at)munifin.fi
Since the lending offered by MuniFin has wide direct and indirect impacts on society, responsibility has been broadly integrated in the company’s strategy. In 2017 MuniFin defined the key principles of responsibility, which have worked as a basis for the Responsibility report. Responsibility at MuniFin is based on four principles: responsible products and services, forerunner in sustainability, improving wellbeing at work and strong corporate governance.
For each key principle, MuniFin has defined indicators and goals, which are monitored annually. MuniFin promotes the achievement of almost all sustainable development goals (SDGs) set by the United Nations.
At the beginning of 2016, MuniFin launched green finance to its customers, a financial product that enables customers’ projects that support sustainable development and climate goals in Finland. During 2017, 25 projects amounting to almost EUR 600 million were added to the green portfolio. The total value of the green portfolio grew to over EUR 1 billion in the end of 2017. The estimated direct annual greenhouse gas emissions avoided for projects approved in 2017 totals approximately 19,400 tons of CO2.
– During the past years we have noticed that the demand for responsible investments is growing fast. We hope that these reports give a new and transparent picture of our responsible operations and commitment in achieving the domestic climate goals, says Esa Kallio, President and CEO at MuniFin.
More information:
Esa Kallio, President and CEO, MuniFin, tel. +348 50 337 7953, esa.kallio(at)munifin.fi
Antti Kontio, Head of Corporate Responsibility, MuniFin, tel. +358 50 370 0285, antti.kontio(at)munifin.fi
Esa Kallio has an impressive track record in finance. He has worked for MuniFin since 2005, most recently heading the company’s funding and treasury functions. Since August 2017, he has also acted as an interim President and CEO.
– I am really looking forward to closer cooperation that will enable us to further improve our dialogue with customers. According to MuniFin’s revised vision, our aim is to be the preferred partner of our customers throughout the financing life cycle. We want to be a visionary sparring partner that welcomes challenges and is also able to challenge its customers. Our personnel has in-depth expertise in our customer sectors and this is something I want our customers to take full benefit of, Esa Kallio says.
– Reforms unequalled in scope are currently taking place in our customers’ operating environment. We will assist them in evaluating the practical effects of the future changes and identifying new solutions. At present, we are focusing on customer-oriented development and the digitalisation of our services. This requires close partnerships with our customers, Kallio says.
Following Esa Kallio’s appointment as the President and CEO of MuniFin, Mari Tyster has been appointed as the deputy to the CEO. Tyster is the company’s Executive Vice President, Legal and Governance and member of the Executive Management Team. Simultaneously, Joakim Holmström and Rainer Holm have been appointed as new members to the Executive Management Team. Furthermore, Holmström, who has headed MuniFin’s funding operations, will assume the responsibility of leading the company’s capital markets operations.
Toni Heikkilä, Jukka Helminen and Marjo Tomminen will continue as members of the Executive Management Team.
The Responsibility Policy is a part of MuniFin’s long-term strategy in responsibility. Skillful and responsible personnel that profoundly understand the impacts of MuniFin’s operations and are committed to promoting long-term goals are at the core of the new policy. The policy also serves as a key external policy for stakeholders such as owners, customers, investors, authorities, the media and other stakeholders.
– We are committed to understanding, monitoring and managing the social and environmental impacts of our own operations and the products and services that we offer in order to contribute to the wider goals for sustainable development in the Finnish society. This engagement is integrated in our strategy and values, says Esa Kallio, CEO (interim) at MuniFin.
The Responsibility Policy can be found here >.
Esa Kallio, CEO (interim)
tel. +358 50 337 7953
Investor demand was very strong from the outset. The high quality, well diversified and granular investor demand allowed MuniFin to tighten the guidance by 4bps with little price sensitivity. 75 minutes after the announcement books closed in excess of EUR 1.9 billion.
In total, 76 investors participated in the transaction. The order book was dominated by investors from Germany (44.1%) and France (14.4%), followed by the Swiss (8.9%), Nordics (7.8%), Benelux (6.9%), the rest of Europe (6.1%), Asia (6.0%), the UK (5.7%) and the Middle East (0.1%).
Central Banks & Official Institutions (39.6%) represented the largest share of allocations, followed by Asset Manager (20.3%), Insurance companies & Pension Funds (20.0%) and Banks (17.8%).
“We are extremely happy with the strong result. We started issuing EUR benchmark notes in 2016 and have been able to build up a liquid curve, which now consists of four reference points. It is very nice to see that there is strong demand for high-quality issuers like MuniFin. In addition, this is the longest benchmark we have issued”, says Joakim Holmström, Head of Funding.
“With this bond, MuniFin successfully extended their EUR curve. After a warmly welcomed EUR green bond last year, the strong and well oversubscribed book showed that EUR investors are also extremely interested in MuniFin’s longer dated paper”, says Crispijn Kooijmans, Head of Public Sector Bond Origination at Rabobank, who acted as a joint lead manager in the transaction.
Details of the transaction:
Issue Size: EUR 500 million
Payment Date: 23 January 2018
Maturity Date: 23 February 2033
Coupon: 1.250 % Fixed coupon
Re-offer Price: 99.905 %
Re-offer Yield: 1.257 %
Re-offer vs Mid Swaps: – 4 bps
Lead Managers: Barclays, Citi, Rabobank, SG CIB
More information:
Joakim Holmström, Head of Funding
joakim.holmstrom(at)munifin.fi
+358 50 444 3638
MuniFin’s green portfolio is highly concentrated on two sectors: public transportation and sustainable buildings. The largest individual projects are the Western metro extension and Tampere tramway, most typical project being a school building. In 2017, first residential buildings in social housing were added in the portfolio.
The new product has been well received in the MuniFin’s customer base. Municipalities have significant potential in achieving Finland’s long-term climate goals and MuniFin wants to support this development by offering a margin discount. Impact reporting for green finance will be published annually.
In 2017 MuniFin decided to establish a portfolio for responsible investments. The socially responsible investments (SRI) portfolio will be launched in 2018 and its target size is directly linked to the total amount of outstanding green bonds. In addition, MuniFin monitors all investments through a quarterly calculated ESG score.
Further information:
Antti Kontio, Head of CSR, tel. +358 50 3700 285, antti.kontio(at)munifin.fi