Global law firm White & Case LLP has advised Stadshypotek on the establishment of its US$15 billion US Medium Term Covered Bond Programme and follow-on issuance of US$1 billion of 1.45% Covered Bonds due 2013 and US$600 million of floating rate Covered Bonds due 2013. These were the first ever issuances of covered bonds in the United States by a Nordic issuer.
Stadshypotek is a leading Swedish major bank-owned mortgage institution that is wholly owned by Svenska Handelsbanken AB (publ) (“Handelsbanken”), a universal bank which provides a wide range of services, both domestically and internationally, for private and corporate customers. Stadshypotek AB is the primary entity responsible for Handelsbanken’s mortgage lending operations in Sweden and other Nordic markets, with a focus on the private market (loans secured by single-family or two-family houses, second homes and residential farms, and shares in housing co-operative apartments) and the corporate market (loans secured by multi-family dwellings, forestry, agriculture and family farms, commercial and office buildings and unsecured loans to state and municipal entities).
Having previously offered covered bonds into the Swedish and Western European markets under its domestic and Euro medium term covered bond programmes, this is Stadshypotek’s first covered bond offered into the United States and was made pursuant to an exemption under the US Securities Act of 1933, as amended. The Covered Bonds will be issued on an unsubordinated basis and in accordance with the Swedish Covered Bonds Issuance Act. As such, the Covered Bonds will have the benefit of a priority right to a matched pool of assets consisting of Swedish loans and mortgages and other assets eligible under the Covered Bonds Issuance Act in the event of a bankruptcy of the Issuer.
“It is a great success for Stadshypotek to have achieved the first Nordic covered bond to be offered in the United States and to have achieved such a low cost of funding,” comments Francis Fitzherbert-Brockholes, the partner at White & Case who led on the deal.
White & Case LLP’s team included lawyers from the Firm’s offices in London, New York and Stockholm. In London, the team included partners Francis Fitzherbert-Brockholes and Gavin McLean, associates Anna Dupont, Joakim Falkner, Sheila Hartigan and Kshiti Vora, and trainee Jonathan Brierley. The Stockholm team included partner Claes Zettermarck and associates Ellen Fagerlund and Johan Mattsson. The New York team included partner Raymond Simon and associate Isaac Tendler.
