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GOVERNMENT BOND FUND

The Government Bond Fund was established in March 2009 as part of the Government’s response to the financial crisis. The Fund was wound up on 30 June 2014.

The purpose of the Government Bond Fund was to increase liquidity and capital inflows to the Norwegian credit bond market. The Fund’s start-up capital totalled NOK 50 billion, and Folketrygdfondet was given responsibility for the Fund’s management.

The Government Bond Fund invested in individual loans on market terms, alongside other investors. The Fund’s mandate required the capital to be invested in interest-bearing securities issued by enterprises resident in Norway.

The Government Bond Fund was not permitted to invest in loans issued by central or local government entities.

The uninvested part of the Fund’s capital was deposited with Norges Bank in a non-interest-bearing account.

Liquidation plan

The mandate for the management of the Government Bond Fund stipulated that Folketrygdfondet should present a plan to unwind the Fund by 31 December 2013, and Folketrygdfondet did so.

The Ministry of Finance then decided that no new investments should be made in the bond market after 21 March 2014, and that the Fund’s existing assets should gradually be liquidated

Liquidation date

All securities held in the Government Bond Fund were disposed of by 30 June 2014. The proceeds (NOK 52332 million) were transferred to the State’s current account.

Reporting

Folketrygdfondet’s annual reports discuss the management of the Government Bond Fund. The 2014 annual report also discusses the liquidation plan for the Fund.

 

 

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