Pareto Securities AS
Pareto Securities maintains its leading position in the Nordic High Yield Bond market despite the challenging market environment.

Pareto Securities maintains its leading position in the Nordic High Yield Bond market despite the challenging market environment.

Frankfurt, July 12, 2022 – Pareto Securities AS, an international investment bank headquartered in Oslo and a long-standing partner to the mid-market in Scandinavia and Germany, has underpinned its market-leading role as arranger in the Nordic Bond market in the first half of 2022, despite the challenging market environment. In the first half of 2022, Pareto Securities achieved a market share of 30% in the overall market and 54% for Euro-denominated Nordic Bonds.

A combination of recession fears, inflation, interest rate hikes and further macroeconomic uncertainties, partly fueled by the war in Ukraine and supply chain issues, have severely clouded market developments in the second quarter. As a result, spreads in high yield markets have widened substantially, making investors very cautious in primary transactions. Relatively, the Nordic Bond market was characterized by greater robustness and lower volatility. According to Pareto Credit Research, the median Nordic High Yield Bond spread increased to 624 basis points during the first half of 2022, a spread widening of 141 basis points, while the Moody’s B2 3-year spread posted a gain of 323 basis points, rising to 703 basis points.

In the entire Nordic Bond market, 32 primary transactions with a total volume of around EUR 2.5 billion were priced in the second quarter. This represents a year-on-year decline of 51%. In the first half of the year, 60 Nordic bond transactions with a total volume of around EUR 4.7 billion were recorded. This represents a year-on-year decline of 55 percent. By way of comparison, new high-yield issues in the U.S. in the period January to May 2022 actually declined by around 75 percent year-on-year, while the Nordic Bond market declined by only 54 percent in the same period. With some primary deals withdrawn and others not brought to market, especially in Q2 2022, the primary market pipeline is building for the second half of 2022.

With the new issues of Media Games Invest 22/26 (EUR 175 million) and Qred Holding 22/25 (EUR 40 million) as well as the first tap issue of Ferratum Capital’s outstanding bond 19/23 (EUR 40 million), Nordic Bonds with a volume of EUR 255 million were listed on the Frankfurt Open Market in the second quarter of 2022. Pareto Securities acted as sole bookrunner in all three transactions. Activity in the German “Mittelstandsanleihe”-format remained muted, with only three transactions with a volume of EUR 119 million in Q2 2022.

Lutz Weiler, CEO Pareto Securities Germany, states: “Despite difficult conditions, Pareto Securities was able to maintain its leading position in the Nordic High Yield Bond market. Pareto recorded the largest market share in the entire Nordic High Yield Bond market with 30% in the first half of the year. At the same time, Pareto was ranked number one arranging bank by its clients in the annual Prospera ranking for Nordic High Yield Bonds.”
 

About Pareto Securities
Founded in 1986, Pareto Securities is headquartered in Norway and has offices in Denmark, Finland, Sweden, France, Germany, the UK, Switzerland, the US, Singapore and Australia. Pareto Securities has a leading position in the Nordic financial markets and a strong international presence. Pareto Securities offers a wide range of financial services, including equity and fixed income brokerage, equity, debt and project finance, and advisory services related to mergers and acquisitions and restructuring.