DENMARK - PFA Pension has become the second major Danish pension fund to invest large sums in state-guaranteed export financing, agreeing to provide DKK10bn (€1.35bn) in loans to foreign companies buying from Danish companies.

The pension fund - the largest non-statutory scheme in Denmark - has signed a partnership deal with the EKF, the export credit agency, the two parties said.

Henrik Heideby, group CEO and president of PFA Pension, said: "The most important task in Danish society right now is to promote growth and create jobs in the private sector.

"PFA Pension wishes to make an active contribution to this process and at the same time making sure that our customers obtain a sound return on their investments," he said, adding that this could be achieved through the new partnership with EKF.

The loans will be arranged by EKF, which will also provide security to ensure that the money will be paid back, the parties said in a joint statement. The export agency is backed by the Danish government.

The financing will give PFA Pension a yield above short-term treasury bond yields, though the exact level will vary from project to project, a spokesman for EKF said.

He said the deal was practically identical to the agreement struck between the export agency and PensionDanmark last November.

EKF said the partnership increased Danish companies' chances of winning new export orders.

Anette Eberhard, CEO of the agency, said: "We know that the demand is there; in the second half of 2011 alone EKF helped to secure loans worth more than
 DKK5 billion."

The price of the EKF guarantees will be based on market terms, the parties said.

The agency will introduce PFA Pension to possible new investments on an on-going basis, they said.

Projects are generally expected to involve loans of at least DKK250m with long credit periods, for example, large projects such as wind farms and activities within the oil and gas industry or similar, they said.
 

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