SINGAPORE (Dow Jones)--Helsinki-based Nordic Investment Bank may issue more bonds denominated in a local currency in Asia as it views the region as an increasingly important source of funding, the bank's chief financial officer said.
The bank has been in talks recently with Thailand, Malaysia, and China about the possibility of issuing local currency bonds, NIB's chief financial officer and treasurer, Torben Nielsen, told Dow Jones Newswires Tuesday on the sidelines of the IMF-World Bank meetings here,
"For the future, we think that the region and the capital markets here will have an increased importance in terms of us being able to provide bonds in local currency," Nielsen said.
The triple-A bank, owned by eight nordic and Northern European countries, is targeting institutional investors looking to place funds in high-grade investments.
NIB has so far issued bonds denominated in yen, Hong Kong dollars, Singapore dollars and Taiwanese dollars.
The bank also issues bonds denominated in U.S. dollars, with the bulk placed to Asian investors.
"More than 50% of our funding activities in 2006, for instance, were bought by Asian domiciled investors," Nielsen said.
Nielsen believes that there are vast opportunities to issue local currency paper in the region, and one way to sustain Asia's strong potential as a funding source is to continue developing its local capital markets.
"What we're seeing is a need to develop the local capital markets, develop pension funds, and build institutional assets in the region," he said.
"This is definitely a region which is poised for growth and I don't see any reason why it shouldn't continue. We're very confident that this will continue," he said.
NIB is owned by Denmark, Estonia, Finland, Iceland, Latvia, Lithuania, Norway and Sweden. The bank finances private and public projects within and outside the member countries.
The investment and multilateral bank projects its lending will grow by an average of 5% between 2006 and 2010.
This growth is increasingly coming from outside the bank's member countries, said Nielsen.
NIB executives last week held a roadshow in Tokyo and will proceed to Indonesia after the IMF meetings to meet with investors.
"The competition for products that we are providing is increasing," Nielsen said.
-By Ditas Lopez, Dow Jones Newswires; +65-6415-4044; firstname.lastname@example.org
-Edited by Iain McDonald
(END) Dow Jones Newswires
September 20, 2006 03:35 ET (07:35 GMT)
Copyright (c) 2006 Dow Jones & Company, Inc.
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