Swedish asset owners invest in social bonds to fight COVID-19

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Swedish asset owners have invested SEK 3 billion ($ 319 million) in a social bond that supports companies in emerging markets whose businesses have been affected by the coronavirus.

The bond was issued by the International Finance Corporation, separate press releases from the three Stockholm-based investors said.

The 928 billion crowns Alecta Pensionsforsakring has invested 2 billion crowns; the 455 billion crown Folksam group invested 700 million crowns; and the insurance company Lansforsakringar AB invested 300 million crowns in the bond.

IFC’s bond targets companies in emerging markets involved in the production and delivery of medical equipment and pharmaceuticals. It aims to ensure that supply chains can be maintained as the virus continues to spread. IFC is part of the World Bank that targets the private sector in emerging markets. The bond is part of the World Bank’s $ 14 billion pledge to support countries and businesses affected by the virus outbreak.

“With this investment, we are helping both counter the negative effects of COVID-19 and create security for businesses and their employees. This type of social bond investment benefits both communities and our clients over the long term, ”Tony Persson, head of Alecta’s focus and strategy group, said in a statement.

“We want to help various (organizations) and countries take action to minimize the tragic effects of COVID-19 as much as possible,” Kristofer Dreiman, responsible investment manager at LFAB, said in a separate statement. “In the long run, private capital can complement (public capital) and help secure jobs and reduce the health and economic effects of the virus outbreak.”


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