MuniFin’s business operations remained strong in 2023, propelled especially by the housing sector’s high demand for financing late in the year. In municipalities, 2023 was the first year when municipalities were no longer responsible for organising healthcare, social welfare and rescue services. Municipal finances were supported by temporary tax benefits stemming from the health and social services reform, which meant that municipalities experienced less demand for financing. Municipalities had also prepared relatively well for the general rise in interest rate levels through interest rate hedging and longterm interest rates.
Hospital districts – the predecessors of the new wellbeing services counties – had proactively prepared for their financing needs by withdrawing financing in advance, but wellbeing services counties’ demand for financing nevertheless increased towards the end of the year.
In 2023, the Municipal Guarantee Board’s limit for MuniFin’s long-term loans to wellbeing services counties was EUR 400 million. Because the counties’ government-authorised borrowing powers in 2023 were considerably higher than this, their financing needs were also higher than the limit imposed on us. MuniFin reached the EUR 400 million limit before the end of the year and could no longer fulfil counties’ financing requests for 2023 after that.
New long-term customer financing remained almost on the same level as in 2022. In total, long-term customer financing at year-end amounted to EUR 32.0 billion at the end of 2023.
2023 key figures
32
EUR bn
Long-term customer financing per Dec 31,2023
10.1
EUR bn
New long-term funding per Dec 31,2023
7.0
EUR bn
Outstanding amount of sustainable finance per Dec 31,2023
6.53
Willingness to recommend (scale 1–7)
Esa Kallio: CEO’s review
Operations remained stable
Business operations
Sustainable finance products keep increasing in popularity
Social finance also continued to gain more demand. At the end of 2023, there were 117 social projects with outstanding financing, and our social finance totalled EUR 2.2 billion.
MuniFin's sustainability agenda
Enabler of sustainable welfare in society
Our sustainability work is now guided by the sustainability agenda we published in October 2023. It also crystallises our role and long-term sustainability goals.
Funding operations highly successful despite market turmoil
Capital markets were highly unstable in 2023. The year was marked by uncertainty resulting from geopolitical confrontations and central bank actions to curb inflation. In early 2023, our funding operations were complicated by the rapidly growing inflation, global banking sector problems and swiftly rising interest rates. In this fast-changing environment, the careful timing of transactions was particularly critical. Towards the spring, the actions of the central banks became more transparent, inflation started to subside, and markets regained confidence during the summer and early autumn. In the autumn, however, the deteriorating overall economic outlook brought on new challenges. Late in the year, margins grew wider and the situation in the euro market became particularly difficult.
Once again, our funding strategy proved effective despite the unstable market environment. We retained strong access to capital markets throughout the year, and the average cost of our funding remained at a low level. We expanded our funding programme somewhat when our customers required more financing than we had initially anticipated.
In total, we made 87 long-term funding arrangements in 12 different currencies. Our new long-term funding in 2023 totalled EUR 10.1 billion.
New long-term funding by region in 2023
Our funding strategy relies on diversifying our funding sources to ensure that our customers have access to financing in all market conditions.
Employee experience efforts yielded great results
At the end of 2023, MuniFin had 185 employees working in various specialist positions. Good employee experience is an important goal for us. We measure employee satisfaction through an anonymous survey conducted annually by an independent research company and follow up with a development plan based on the results, focusing on the most important areas of development identified together. Our employees have been closely involved in planning and implementing measures to improve our employee experience.
Our employee experience has developed positively. In March 2023, we were ranked among Finland’s most inspiring workplaces based on the results of our 2022 employee experience survey. Our 2023 survey results not only exceeded the average for Finnish expert organisations, but also showed an improvement over the previous year.
We invest in skills development. In updating our strategy, we established skills development as one of our strategic cornerstones.
Contact us
More information about annual reporting
