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Nordic Investment Bank (NIB)

Nordic Investment Bank (NIB)

About NIB

NIB are the international financial institution of the Nordic and Baltic countries. NIB works towards a prosperous and sustainable Nordic-Baltic region.

NIB's mission is to finance projects that improve the productivity and benefit the environment of the Nordic and Baltic countries.

Strong ownership

Located in Helsinki, Finland, the Nordic Investment Bank (NIB) is an International Financial Institution owned by the governments of the Nordic and Baltic countries. The Nordic countries created NIB in 1975 to overcome investment barriers and attract commercial lending. Since 2005, the Bank’s mission has been to improve the productivity and the environment of the Nordic–Baltic region.

Financing with a purpose

Our mission given by the owner countries addresses the needs of the region and challenges it is facing—sustainable growth, climate change, the protection of marine environments, pollution prevention and productivity improvement. NIB’s major impact comes from its long-term lending to projects.

Financial strength

The Bank is a reliable source of long-term lending for our customers. We acquire the funds for its lending by borrowing on the international capital markets. This way, the Nordic and Baltic member countries can finance the green transition. With NIB’s strong ownership and highest possible credit rating—AAA from Standard & Poor’s and Aaa from Moody’s— we offer stability and reliability to global investors.

Fulfilling our mission requires financial strength. NIB aims at earning a sufficient amount of return from business operations and at the same time guarantee our owners a reasonable return on capital.

Sustainable financing

The UN 2030 Agenda for sustainable development sets integrated goals that aim to achieve a balance between the economic, social and environmental dimensions. We analyse all loan projects, both for improving productivity and the environment, from a sustainability perspective.

A quality stamp

We finance projects that generate long-term environmental impact and productivity growth. Financed by NIB means both that a project gets a competitive long-term loan and that the project has been thoroughly scrutinised for its sustainability merits. NIB’s financing is a quality stamp for our customers.

Financing the future

To support the productivity of the Nordic and Baltic countries, NIB directs financing to projects that focus on:

  • technical progress and innovation
  • human capital and equal economic opportunities
  • improvements in infrastructure
  • market efficiency and business environment

In terms of the environment, NIB targets projects that forster

  • pollution prevention
  • preventive measures
  • resource efficiency
  • development of clean technology
  • climate change mitigation

Offering long-term loans for the purposes of sustainable growth in our member countries helps us live up to our promise of financing the future.

Member countries, structure and capital

NIB was established on 4 December 1975 through an intergovernmental treaty between Denmark, Finland, Iceland, Norway and Sweden. On 1 January 2005, Estonia, Latvia and Lithuania became members of the Bank.
As an international financial institution, the Bank is governed by constituent documents adopted by the member countries. The structure of NIB's Board of Governors, Board of Directors and Control Committee reflects the Bank's ownership.

Constituent documents

NIB is governed by its constituent documents, namely the Agreement between its member countries and the Statutes, as well as the Host Country Agreement concluded between NIB and the government of Finland. These establish that NIB is the member countries' common international financial institution (linked to Glossary), which has the same status as other legal persons conducting similar operations within and outside the member countries.

Furthermore, the constituent documents stipulate that NIB has the status of an international legal person with full legal capacity, define the immunities and privileges of the Bank and its personnel, and set out the structure for the governance of the Bank.

Authorised Capital

NIB's authorised capital amounts to approximately EUR 6,142 million. NIB’s member countries have subscribed the authorised capital according to a distribution key based on the eight member countries' gross national income.

The authorised capital consists of paid-in capital and callable capital. About 6.82% of the subscribed authorised capital stock is paid in. The remainder of the authorised capital consists of callable capital, which is subject to call if the Board of Directors deems it necessary. In addition to the paid-in and callable capital, the Bank has various reserves.

The Bank may make loans and issue guarantees up to a total amount equivalent to 250% of the authorised capital stock and accumulated general reserves. In addition to these limits, the Bank has special lending facilities guaranteed by the member countries.

Structure and management

Each member country designates a governor for the Bank's Board of Governors, which is the supreme decision-making body. The Control Committee is the Bank's supervisory body. The Board of Directors makes policy decisions concerning the operations and approves the financial transactions proposed by NIB's President. NIB's President is responsible for the conduct of the current operations of the Bank. The President is assisted in his or her work by the Executive Committee, the Asset and Liability Committee, the Credit Committee, the Finance Committee, and the Business and Technology Committee.

Cooperation

We place great importance on cooperation with other financing institutions. NIB's aim is to add value for its customers by supplementing other sources of finance with long-term loans.

NIB co-finances projects with other international financial institutions and public and private lenders, cooperates with local intermediaries in financing small businesses and actively participates in Northern Dimension partnerships. With regards to environmental cooperation, NIB has signed the European Principles of the Environment together with four other European international financial institutions.

International financial institutions

NIB has established cooperation with international financial institutions such as the Asian Development Bank, African Development Bank, Council of Europe Development Bank, European Bank for Reconstruction and Development, Inter-American Development Bank, as well as the IBRD, IDA, and IFC within the World Bank Group.

Furthermore, NIB has cooperation agreements with three regional multilateral banks: the Black Sea Trade & Development Bank, the Central American Bank for Economic Integration CABEI and the Development Bank of Latin America CAF. Through these institutions, NIB can operate also in countries where it has no agreement on financial cooperation.

Legal framework and policy documents

NIB is governed by its constituent documents, namely the Agreement among its member countries and the Statutes, as well as the Host Country Agreement concluded between NIB and the Government of Finland. These establish that NIB is the member countries' common international financial institution, having the same status as other legal persons conducting similar operations within and outside the member countries.

Furthermore, the constituent documents stipulate that NIB has the status of an international legal person with full legal capacity, define the immunities and privileges of the Bank and its personnel and set out the structure for the governance of the Bank. In addition to the constituent documents of the Bank, NIB's activities are governed by a number of policies, guidelines and instructions adopted by the Board of Directors or the President.

Intermediaries

In addition to financing projects directly with larger companies, NIB channels financing to small and medium-sized enterprises (SMEs) through intermediaries. Loan programmes with intermediaries broaden the geography of NIB's operations as they allow the Bank to reach companies with specific knowledge of national and regional markets.

In NIB's member countries, commercial banks usually act as intermediaries. Outside the member countries, NIB cooperates both with financial intermediaries, mainly commercial banks and state-owned development banks, and with governmental intermediaries, such as ministries of finance and economy.

 Nordic Finance Group (NFG)

Together three financial institutions located in Helsinki, Finland,—NIB, the Nordic Development Fund (NDF) and Nordic Environment Finance Corporation (NEFCO) —form the Nordic Finance Group.

  • NDF is the joint development finance institution of the five Nordic countries and facilitates climate change investments primarily in low-income countries.
  • NEFCO is an international financial institution established by the Nordic countries to increase environmental awareness in Eastern and Central Europe by providing financing to small and medium-sized environmental projects.

Northern Dimension (ND)

The Northern Dimension (ND) is an instrument of cooperation between four equal partners, the European Union, Russia, Norway and Iceland. Geographically, the ND covers Northwest Russia, the Baltic Sea and the Arctic regions, including the Barents region. The USA and Canada hold observer status in the ND.

The Northern Dimension policy aims to support stability, welfare and sustainable development in the region by means of practical cooperation. The ND is an instrument through which the European Union, Russia, Norway and Iceland cooperate in selected fields, such as the environment and nuclear safety or social welfare and health care issues.

The Northern Dimension also addresses questions that specifically conern the northern areas, such as the vulernable Arctic environment and matters related to indigenous peoples.

The main regional organisations active in the Northern Dimension are the Council of the Baltic Sea States, the Barents Euro Arctic Council, the Arctic Council and the Nordic Council of Ministers.

Northern Dimension Enviromental Partnership (NDEP)

NIB is a partner in the Northern Dimension Environmental Partnership (NDEP), which is a cooperative effort to coordinate and support the financing of urgent environmental investments in north-western regions of Russia. The partnership combines the expertise and resources of the European Commission, the Russian Federation, the EBRD, the EIB, NIB and the World Bank.

The NDEP promotes sustainable solutions in wastewater treatment, solid waste management, energy and water supply, as well as the treatment of nuclear waste. 

Northern Dimension Partnership on Transport and Logistics (NDPTL)

The Northern Dimension Partnership on Transportation and Logistics (NDPTL) was established in October 2009. The current members of the NDPTL are Belarus, Denmark, Estonia, Finland, Germany, Latvia, Lithuania, Norway, Poland, Russia, Sweden and the European Commission.

NDPTL endeavours to accelerate the implementation of major infrastructure projects within the Northern Dimension region, serving as a regional forum for transport and logistics issues and complementing the work of cooperation structures already in existence, with project financing to stem from national budgets, the EU, international financial institutions and relevant national financial institutions.

A secretariat for the partnership was set up within NIB in Helsinki in February 2011 with the objective of providing administrative and technical support to the Steering Committee and High-Level Meetings in their task of monitoring the implementation of the Partnership.

The objectives of the Partnership are detailed in the Memorandum of Understanding signed in Naples on 21 October 2009 on a ministerial level by eleven countries and the European Commission.

Environmental cooperation

NIB seeks business partners who share its vision and commitment to sustainable development. The Bank also works together with other international financial institutions (IFIs) and organisations in order to promote sound, coordinated and effective approaches to environmental issues. NIB participates in several international and regional forums for environmental cooperation, including the Northern Dimension Environmental Partnership.

NIB works together with the Baltic Marine Environment Protection Commission, also known as HELCOM. Within the Council of the Baltic Sea States, NIB is part of the international working group Baltic Agenda 21. NIB also participates in the MFI Environmental Working Group, which is a cooperation forum for multilateral financial institutions. NIB communicates its environmental requirements to its financial intermediaries and may assist the intermediaries in implementing them.

In 2006, together with four other European IFIs—EIB, EBRD, CEB and NEFCO—NIB signed the declaration European Principles for the Environment (EPE) concerning environmental management in the financing of projects. The aim of the declaration is to promote sustainable development and to protect and improve the environment. The EPE is based on the environmental principles, practices and standards of the European Union. The ambition is, however, to apply the EPE to projects in all the countries in which NIB and the other signatory banks operate.

In 2013, NIB and nine other IFIs adopted the International Financial Institution Framework for a Harmonised Approach to Greenhouse Gas Accounting. CO2 estimates are an important parameter in assessing a project’s eligibility for NIB’s financing under the environmental mandate.

In 2015, on the basis of the harmonised approach to project-level greenhouse gas accounting, IFI working groups developed sector specific accounting principles for renewable energy, energy efficiency and the transportation sector.

In 2016, NIB became a member of the Green Bond Principles (GBP) Executive Committee, a group within the International Capital Markets Association (ICMA).

In 2017, NIB was appointed by the European Commission as observer to the High-Level Expert Group on Sustainable Finance.

Our impact

As a mission-driven bank, NIB focuses on financing projects that improve productivity and benefit the environment in the Nordic–Baltic region.

Prior to making loan decisions, NIB assesses how the projects considered for financing promote productivity gains and provide environmental benefits in the Bank’s member countries. We follow up the project implementation, and once completed, we evaluate the extent to which the estimated impacts have materialised. In measuring the impact of our financing, we apply a set of predefined indicators. NIB also monitors its own environmental footprint annually.

What we report

The impact from our lending is measured according to a set of productivity and environmental indicators. We are constantly developing reporting parameters to provide our stakeholders specific data on the impact of NIB’s operations. Currently, we publish descriptions of newly agreed loans, visit Agreed Loans. In the annual reports, we disclose the aggregated productivity and environmental impact of our lending and we calculate the total net emissions of greenhouse gases for all projects. Impacts of projects funded through NIB Environmental Bonds (NEB) are presented in the annual NEB reports. In cooperation with other major international financial institutions, we contribute to harmonized frameworks for impact reporting, for example on renewable energy and energy efficiency. NIB also participates in Green Bond Principles working groups. Currently, the Bank is member of the “Green Bond Taxonomy” and “Green Bond Eligibility” groups. In this context, impact reporting metrics for sustainable water and wastewater management, waste management and resource efficiency projects were developed.

NIB reports its impact in accordance with the harmonized standards.

Why invest in NIB

NIB is the international financial institution owned by the Nordic and Baltic countries. The Bank is an established supranational issuer of benchmark bonds in several currencies, attracting a global investor base. NIB bonds offer a long-term investment opportunity in a stable, highly rated name.

Triple-A Nordic issuer

The Bank’s triple-A credit rating has been assigned by Standard & Poor's and Moody's uninterruptedly since NIB was first rated in the early 1980s. NIB’s credit rating reflects its high asset quality, capital adequacy, strong balance sheet and ownership.

The Bank’s target is to ensure a sufficient level of liquidity to be able to continue disbursing new loans and to fulfil all payment obligations for at least one year ahead, without additional new funding. NIB's asset liability management methods and risk management tools enable the Bank to issue in different amounts and currencies, and with different maturities and structures. The Bank has outstanding debt in some 20 currencies. NIB's multilateral status and credit rating make NIB a strong credit in any currency.

Values

Our values reflect who we are, how we work and what is important, on a daily basis, to us, our customers, partners and the other stakeholders we work with.

 Competence 

  • We aim for a high level of professionalism and efficiency.
  • We are forward-looking and proactive.
  • We keep ourselves informed about changes in the business environment and take responsibility for our own professional development

Commitment

  • We are transparent in our actions and apply good governance.
  • We care about how we do business and the impact of our actions and behaviour on people, society and the environment.

Cooperation

  • We support each other in the Bank by sharing information, knowledge, skills and experiences.
  • We cooperate with our customers on the basis of sound banking principles, thereby creating mutual value.
  • We respect diversity and the principles of equality.
  • We encourage constructive discussions to reach common goals.

What we finance

NIB provides loans and guarantees to private and public limited companies, governments, municipalities and financial institutions.

Purpose of financing

NIB loans are granted for special purposes, that is, projects, investment programmes, and onlending to SMEs and small midcaps.

Scope of projects

Normally, total project costs would amount to some EUR 20 million and upwards. Smaller projects and investments of small and medium-sized enterprises and small midcaps would be financed from special loan facilities opened in cooperation with local intermediary banks.

Up to 50% of project costs, 75% for midcaps

A NIB loan or guarantee for a project should generally not exceed 50% of the total cost of the project. In a loan to a midcap, NIB's financing may cover up to 75% of the costs.

  • Costs from EUR 20m upwards
  • 50% of costs, 75% for midcaps
  • Loan maturities of 5 to 25 years
  • Grace periods of 3 to 5 years
  • Currency flexibility

Long maturities

As a general rule, all loans are limited to the economic life of the asset or the relevant underlying contracts supporting the financing. Most of the loans provided by NIB vary from 5 to 25 years in maturity.

Adequate security

NIB may grant both secured and unsecured loans to counterparties that are sufficiently creditworthy. NIB requires various undertakings by the counterparty as part of the loan documentation. The terms and conditions are tailored to each case individually, and normally are in line with the terms and conditions of the borrower’s other secured or unsecured senior loans.

Repayment and grace periods

Loan availability and repayment profiles are designed to match your financial need. Grace periods are based on the merits of the project.

Experience in project and structured finance

NIB can assist its customers with project and structured finance, for example using the public–private partnership model. NIB is a leading debt financier of PPP projects in its member countries, and it has experience of project financing in the energy and infrastructure sectors. NIB typically co-finances with other financial institutions and public- and private-sector lenders.

Currency flexibility

Borrowers can choose between most convertible currencies.

Interest rates and fees

The interest rate is set on a fixed or floating basis, as preferred by the borrower. Fees include commitment and arrangement fees.

Lending business areas:

  • Energy & Environment
  • Infrastructure, Transport & Telecom
  • Industries & Services
  • Financial Institutions & SMEs

Countries of operation

The majority of NIB's operations are located in the Nordic–Baltic region. Outside the membership area, NIB may finance projects that involve member country interests, such as investments by corporates in its member countries, technology transfer, equipment deliveries, or other ways of internationalising member country businesses. The Bank may extend loans in countries that have signed agreements on financial cooperation with NIB. In certain cases, loans may be provided in other OECD countries.

Furthermore, NIB has concluded cooperation agreements for onlending programmes with the following regional multilateral banks:

  • Black Sea Trade and Development Bank
  • Central American Bank for Economic Integration (CABEI)
  • Development Bank of Latin America (CAF)
  • Inter-American Investment Corporation (IIC)
  • Development Bank of Southern Africa

Through financial intermediary institutions, NIB can also operate in countries where it has no agreement on financial cooperation.

Energy & Environment

We offer loans with long tenors to match the life cycle of your large-scale, economically sound energy and/or environmental project. We will make sure our offer is in line with your needs and provide you with expertise in the sector. Our originators, transaction managers and analysts have comprehensive and diverse experience in assessing and financing relevant areas, such as renewable energy, energy efficiency, reduction of carbon emissions and nutrient discharges into water, etc.

  • wastewater treatment
  • renewable energy generation, including hydropower, solar, wind, geothermal, biomass and waste-to-energy plants
  • electricity transmission, distribution networks and smart metering systems
  • energy efficiency investments in existing buildings
  • renewable fuels
  • waste management and recycling

The focus of the Energy & Environment business area is on projects that contribute to renewable energy production, carbon-neutral technology and increased energy efficiency. We gladly consider environmental improvements aimed at better resource efficiency, upgrading water treatment, minimising waste, recycling and cleaner production.

Infrastructure, Transport & Telecom

We offer financing loans with tenors of up to 30 years to match the life cycle of your investment in infrastructure development, be it an airport, a road or railway link, street lighting, a hospital or school, a public transport fleet, or rolling out a mobile network. We will share our expertise with you and assist you in identifying your project’s conformity with NIB’s mission, which is key for us to be able to support your project with financing.

Effective infrastructure, transportation and communication are essential parts of achieving productivity gains. The focus of the Infrastructure, Transport & Telecom business area is primarily on improving efficiency in transport networks and logistics in the Nordic–Baltic region and in telecommunications, as well as investments in public infrastructure, such as water supply, schools, universities and hospitals.

We also finance infrastructure investments outside the membership region. These projects would typically involve the supply of technology or direct investments from a member country, for instance, in infrastructure assets in one of the neighbouring countries.

Projects eligible for NIB’s financing in the Infrastructure, Transport & Telecom business area may have the following objectives:

  • investments in public transport
  • improvement of public infrastructure (schools, hospitals, universities, airports)
  • upgrading the supply of fresh water
  • road construction
  • implementation of a new generation of broadband and mobile network technology

Industries & Services

In the Industries & Services business area, we provide tailored loans with long maturities to large and medium-sized corporates, typically for research and development costs (up to four years), green buildings or investments in new production capacity, or, for instance, new logistics centres or storage facilities.

We attach great importance to understanding our clients’ businesses and current situation to tailor our loan offers so that they match the clients’ need and wishes. We offer our clients a wide range of options in terms of loan structures, tenors, currencies, availability periods, etc.

Our transaction teams consist of financial experts with many years of experience in loan structuring and corporate credit analysis. NIB’s in-house senior environmental analysts, who evaluate all projects from a sustainability perspective, can provide guidance to our clients in environmental matters. We are happy to discuss your financing needs and give you a quick feedback.

Financing needs eligible for NIB loans in the Industries & Services business area would, for example, include:

  • research and development programmes
  • investments in new production and logistics capacity
  • international expansion
  • green buildings
  • acquisitions

Financial Institutions & SME

Small and medium-sized enterprises (SMEs) and small mid-caps are an integral part of the economy in the Nordic–Baltic countries. Therefore, we have a specific focus on supporting the development of small businesses in the Bank’s member countries. In order to reach out to SMEs and small mid-caps, NIB concludes loan programmes for onlending through financial institutions, such as commercial banks, leasing companies and other financial organisations. We can also engage in risk-sharing facilities with local financial institutions.

Through financial intermediaries, NIB normally finances small and medium-sized enterprises and small midcaps in the member countries. Loans from NIB can be used to finance both working capital with tenors of at least one year, and tangible capital. NIB can also finance small-scale environmental and energy efficiency projects through financial intermediaries. These projects should directly or indirectly result in decreased emissions of greenhouse gases or reduced discharges of nutrients into the Baltic Sea or of harmful substances into any waterway in the member countries.

In non-member countries, we offer project-specific programmes or general onlending programmes with selected financial institutions or governments to finance investments that involve a member country interest and that meet the Bank’s criteria for productivity gains of member country companies. In addition, projects may, if applicable, also be required to meet NIB’s environmental criteria for climate change mitigation.

The potential impact of projects will be evaluated on a case-by-case basis. The focus may be, for example, on identifying and financing projects that benefit from expertise and technologies from NIB’s member countries.

Contact us

HQ: Fabianinkatu 34,
P.O. Box 249,
FI-00171 Helsinki,
Finland

This email address is being protected from spambots. You need JavaScript enabled to view it.

Tel: +358 10 618 001
Fax: +358 10 618 0725

Contact

European Long-Term Investors a.i.s.b.l.
Rue Montoyer 51
B - 1000 Brussels
Belgium
secretariat@eltia.eu