Many of Nykredit and Totalkredit's customers with 4% bond loans are currently
considering refinancing into 6% loans, thereby reducing their debt outstanding.
Customers of Totalkredit who have raised 4% interest-only bond loans (in ISIN
code DK0004717477, 4% 41C.s OA, 2035) may, however, only buy back the
un-derlying bonds in the market at prices currently considered unreasonably
high. Hence, such loan refinancing becomes disproportionately expensive.
The reason for the high prepayment prices may be that a small number of
investors have purchased a large part of the bonds behind these loans. The
Nykredit Group is not able to neither influence such behaviour directly nor
identify which investors hold which bonds.
Price differences between bonds issued in the market arise inherently - also
despite the bonds having been issued on nearly identical terms. However, in
situations with extraordinary market conditions where customers are charged
unfair prices in connection with loan prepayment and refinancing, Nykredit and
Totalkredit are of the opinion that customers should have access to prepay
their loans at prices which are not based on a buyback of bonds.
It has therefore been decided that customers with loans funded through the
above-mentioned ISIN code may prepay their loans at a price quoted by
Totalkredit.
The new prepayment option applies to prepayment offers issued from 9 July and
only to the specific ISIN code, and it will be cancelled when Nykredit and
To-talkredit no longer view the price difference as unreasonably high.
Questions may be directed to Hans Henrik Andersen, Managing Director,
Totalkredit, tel +45 44 55 54 02, or Henrik Hjortshøj-Nielsen, Executive Vice
President, Nykredit, tel +45 44 55 10 40.
