KBN Funding Update - H1 2026
While volatility has become a familiar feature of recent years, the first half of 2026 has been particularly eventful.
The market has shifted from a late 2025 narrative of relatively benign disinflation, towards a complex environment characterized by renewed energy inflation and disruption, geopolitical shocks, tariffs and broader geoeconomic fragmentation, higher rates and Central Bank policies pivoting from easing to hiking.
Despite this volatility, the SSA market has proved to be very resilient. Spreads versus swaps and U.S Treasuries have traded near historical tights but investor demand and orderbooks have remained very strong. KBN has taken advantage of these conditions throughout H1 and completed approximately 75% of its annual funding programme. KBN has raised USD 7.5bn equivalent of its USD10bn 2026 funding task. Via its broad and diversified funding programme, KBN has issued 43 individual transactions across 9 different currencies.
Over 60% of funding raised has been denominated in USD, with GBP, AUD, SEK, EUR and CHF being the other major currencies. Private Placements have been issued in HKD, CNH and INR.
In terms of structures, in H1 KBN has raised over 94% of its funding in Plain Vanilla issuance, with Fixed Rate note issuance accounting for over 77%. KBN has been active in the USD FRN market, issuing a new 5-year USD FRN as well as tapping outstanding 2029 and 2030 FRN lines. Outside of Plain Vanilla issuance, KBN has issued USD 460m in Fixed Rate Callable Notes across a variety of maturities.
KBN has continued to see excellent demand from its traditional investor base throughout 2026. Europe remains KBN’s largest investor geography, taking over 40% of KBN’s H1 issuance. Geographical investor interest remains broad-based though, the Americas (including US) account for 31%, Asia-Pacific investors 19% and the remainder spread between investors in Africa and the Middle East.
In terms of Investor Type, KBN’s traditional investors have dominated interest. Reflecting KBN and Norway’s safe-haven status, Central Banks and Official Institutions remain KBN’s largest investor base, having bought 40% of KBN’s issuance in H1. This is followed by Banks (37%) and Asset Managers (23%)
Benchmark and Green Issuance
Throughout H1, KBN has issued 2 new USD 1.5bn 5-year Benchmarks. Both deals were substantially oversubscribed (books in-excess of USD 5.2bn and USD 3.2bn respectively) and priced 3bps tighter than initial guidance. At a final spread of CT +8.025, the new June 2031 benchmark is the tightest spread to US Treasuries achieved by KBN in the USD market.
KBN also continues to diversify its funding programme with issuance in other public markets. KBN issued a new 5-year AUD Benchmark and a 4-year GBP Benchmark. The AUD 500m February 2031 trade received KBN’s largest ever AUD orderbook (AUD 1.65bn) and the new October 2030 GBP, which has subsequently been tapped several times since launch, currently has an outstanding amount of GBP 450m. With regards to Green Bond issuance, KBN has been active in the SEK market issuing both a new 3-year and 4-year SEK Green Bond, totaling SEK 3bn.
Funding forecast
KBN expects to raise approximately USD 2.5bn equivalent for the remainder of the year. Subject to markets and pricing, KBN plans to be active in the public Green Bond market in either USD or EUR and foresees another USD denominated benchmark transaction throughout 2026. KBN will also assess opportunities in other public markets and private placements for the remainder of the year.
And as Norway races towards its Round of 16 game against Brazil in the World Cup, it would be remiss of us not to say “Heia Norge!” and “Ro! Ro! Ro! Ro! Ro!”
The KBN Funding Team
