Indeed, in addition to the local currencies and distinct national rivalries, the state of development of local capital markets in Denmark, Finland, Norway and Sweden is also vastly different too.
Daniel Sachs, chief executive of Stockholm-based Proventus Capital Partners, a private investment firm that provides loans to and buys the bonds of mid-sized companies in the region and beyond, neatly describes the differences in the local Nordic capital markets when he says: "Norway has by far the most developed high-yield bond market; Sweden has the most developed stock market; and Denmark has the most developed mortgage bond market. Finland’s market has in the past been dominated by Nokia, but this is changing for understandable reasons."
These characteristics mean each country’s capital markets are at different stages of development, but they are developing, and because the importance of alternative sources of capital to bank loans has hit home.
"If you go back to before the crisis, most of the bonds we were underwriting were for financial institutions," says Bo Wetterstein, global head of debt capital markets at Danske Bank in Copenhagen. "SSA issuance was limited because the Nordic public sector was in pretty good shape, and the corporate market was spoiled by too many Nordic and too many international banks throwing cheap money into this market, so there was no real need for bond issuance.