NORWAY - The NOK202bn (US$28.79bn) Kommunal Landspensjonskasse (KLP), one of Norway's largest life insurance companies, has increased its loans portfolio by around NOK5bn will issue more loans to municipalities in the future, MandateWire reports.
"It has become more difficult and costly for Norwegian municipalities to obtain loans and KLP considers loans to municipalities to be a good and secure investment," said the company about the decision, adding that in the first instance an increase of NOK5bn had been made.
It said the figure would go up in the future as KLP sought to "contribute to a healthy and functional credit market for Norwegian municipalities".
At the same time the equity stake in the group portfolio has been further reduced to 7.2% of assets.
"KLP now has a very low equity exposure and a correspondingly large proportion of investments in long term interest-bearing securities with a high regular return that will provide stable and good income for the future," the company said, hinting however that it was prepared to increase risk in the portfolio once financial markets have stabilised.
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