Stockholm (HedgeNordic) – Sweden’s central bank has hired a former hedge fund manager, Anders Nordborg (pictured left), for a credit trading role as the Riksbank has offered to purchase SEK 10 billion in corporate bonds to mitigate the effects of the coronavirus pandemic on the Swedish economy. Nordborg co-managed credit hedge fund Trude with Marek Ozana under the umbrella of Excalibur Asset Management until the fund’s closure last year.
“The central bank’s presence in the capital market has increased markedly in the last decade, which makes for an exciting workplace,” Anders Nordborg told Bloomberg. “It will be incredibly fun to be part of the Riksbank family,” Nordborg added.
A little more than a month ago, the Riksbank expanded its quantitative-easing measures by increasing its asset purchase programme from SEK 300 billion to SEK 500 billion and extending its duration to the end of June next year. The Riksbank’s boosted asset purchases include corporate bonds for the first time. According to the Riksbank, “this is a new measure and the intention is that the purchases will be initiated in September 2020.” The purchases will entail corporate bonds issued by companies with a credit rating equivalent to Baa3/BBB- or higher, with a remaining time to maturity of up to five years.
The mandate to buy corporate bonds, however, accounts for a small fraction of Riksbank’s SEK 500 billion asset purchase programme, with some questioning whether the plans would have a material impact on mitigating the effects of the coronavirus pandemic on the Swedish economy. “They are expected to be made on the secondary market and from the Riksbank’s monetary policy counterparties,” writes the Riksbank. “By initiating purchases of corporate bonds in this way, the Riksbank can establish a presence on the market for these securities and thereby ensure a good capacity to rapidly extend the scope of the purchases if monetary policy needed to be made more expansionary going forward,” the Riksbank continues.
Anders Nordborg and Marek Ozana joined Excalibur Asset Management in 2015 to launch and manage Trude. Both Nordborg and Ozana joined the Stockholm-based asset manager from SEB, where they had been managing fixed-income and credit funds. Trude was launched in October 2015 with more than SEK 500 million under management and was closed at the end of September last year after a challenging market environment for the fund.