Terms for switches in inflation-linked bond SGB IL 3104

31 March 2016

The Swedish National Debt Office offers switches amounting to approximately SEK 6 billion in SGB IL 3104 (3.5%, 1 Dec 28) as a measure to decrease its share of the inflation-linked bond index. The switch auctions will take place on 22, 25 and 26 April.

In the first and second switch auction the Debt Office plans to sell SGB IL 3112 (0.125%, 1 Jun 26). These auctions will be made cash neutral[1]. In the third auction the Debt Office plans to sell SGB IL 3111 (0.125%, 1 Jun 32) in a price risk neutral[2] switch.

Switch auctions

 

Friday 22 April
Cash neutral

Monday 25 April
Cash neutral

Tuesday 26 April
Price risk neutral

SNDO sells bond

3112

3112

3111

SNDO sells amount (SEK mn)

5 000

3 500

1 500

SNDO buys bond

3104

3104

3104

SNDO buys amount  (SEK mn) [3]

2 900

2 000

1 250

Time for buy-back yield

10.45

10.45

10.45

Time for auction close

11.00

11.00

11.00

Time for auction result

11.03

11.03

11.03

The bid yield on the buy-back bond SGB IL 3104 will be published on riksgalden.se/borrowing at 10:45 on the day of the auction.

Bids must be placed before 11.00 a.m. on the auction day. The results will be published at 11.03 or somewhat later. Bidding is only possible through primary dealers.

At the same time as this release is published, the Debt Office will temporarily stop selling SGB IL 3104 within the continuous switch facility for its primary dealers. No other inflation-linked bond in the switch facility will be affected. Meanwhile the Debt Office will continue to buy SGB IL 3104 in exchange for other inflation-linked bonds. When the above mentioned switch auctions are completed the Debt Office will resume selling SGB IL 3104 in exchange for other inflation-linked bonds. 

The Debt Office announced the plans to switch SGB IL 3104 in its publication Central Government Borrowing – Forecast and Analysis 2016:1.

Contact
Maria Norström, Head of Funding, +46 (0)8 613 46 35
Joy Andersson, Senior Analyst, + 46 (0)8 613 47 38



[1] The market value of the purchase and sales volumes of each bond shall be equal.

[2] The market value of the purchase and sales volumes multiplied by the modified duration of each bond shall be equal.

[3] The stated nominal volume of the buy-back loan is an approximation calculated on the basis of today’s yields.