Annual report 2025

Key figures

Return

The fund’s value

Translated from Norwegian for information purposes only. The Executive Board signs the official Norwegian version.

1. Results

The Executive Board’s assessment of the results

The investments in the Government Pension Fund Global returned 15.1 percent in 2025 following strong gains in global equity markets. The return was 0.28 percentage point below the fund’s benchmark index. This is within the range of variation in relative return that can be expected from one year to the next. The Executive Board emphasises the importance of assessing results over time and is satisfied that the return over time has been higher than the return on the fund’s benchmark index.

From the left: Øystein Børsum, Pål Longva, Kristine Ryssdal, Hans Aasnæs, Ida Wolden Bache, Ragnhild Janbu Fresvik, Nina Udnes Tronstad, Arne Hyttnes, Mats Bay Fevolden (employee representative), Thomas Ekeli, Guro Heimly (employee representative).
 

At the end of 2025, the value of the Government Pension Fund Global was 21,268 billion kroner and the fund’s investments comprised 71.3 percent equities, 26.5 percent fixed income, 1.7 percent unlisted real estate and 0.4 percent unlisted renewable energy infrastructure.

The return measured in terms of the fund’s currency basket was 15.1 percent last year before management costs. The return on equities was no less than 19.3 percent. Solid corporate earnings in investee companies and optimism regarding artificial intelligence led to strong equity markets. Fixed-income instruments returned 5.4 percent in 2025, while investments in unlisted real estate returned 4.4 percent. The fund’s investments in unlisted renewable energy infrastructure returned 18.1 percent last year.

The Executive Board considers the overall return on the fund over time to have been solid. In the period between 1998 and 2025, the average annual return was 6.6 percent. The annual net real return, after deductions for inflation and management costs, was 4.3 percent in the same period.

Over the past five years, the Government Pension Fund Global has generated an accumulated return of 8.3 percent measured in the fund's currency basket before management costs, or approximately 7,000 billion kroner in accounting terms. The largest contribution comes from the fund’s equity investments. With such a large fund and an equity share of around 70 percent, we have to be prepared for the possibility of a significant decline in the fund’s value.

The Ministry of Finance determines the overall investment strategy for the fund. Norges Bank manages the fund with a view to achieving the highest possible long-term return, within the constraints laid down in the mandate from the Ministry of Finance. The Executive Board determines a strategic plan for the fulfilment of the investment mandate.

Since 2013, Norges Bank has grouped its investment strategies into three main strategies: market exposure, security selection and fund allocation. In the strategic plan for the period 2026 to 2028, which the Executive Board adopted towards the end of last year, these strategies have largely been continued. The investment strategies are complementary and aim to take advantage of the fund’s distinctive characteristics. We do not expect all investment strategies to generate excess return at all times. The strategies have different time horizons and results will vary with different market conditions. The objective is for them to collectively generate excess return over time.

Under the strategy for market exposure, the fund is invested broadly and cost-effectively in the equities and bonds included in the benchmark index. The security selection strategy involves analysing companies and assessing whether the fund should invest more or less relative to the benchmark index. Norges Bank uses both internal and external managers for security selection. The fund allocation strategy comprises various strategies designed to improve the fund’s return and risk characteristics over time. The fund’s investments in real estate and unlisted renewable energy infrastructure form part of this strategy.

In 2025, the fund’s return before management costs was 0.28 percentage point lower than the return on the benchmark index. Market exposure contributed positively, while security selection and fund allocation contributed negatively to the fund’s relative return. The Executive Board notes that the fund’s total return over the last three years has been lower than that of the benchmark index due to the negative contribution from fund allocation.

The Executive Board emphasises that the fund’s performance must be assessed as a whole and over time. In the period between 1998 and 2025, the annual return before management costs was 0.24 percentage point higher than the return on the benchmark index from the Ministry of Finance. Norges Bank has measured the contributions to excess return from the three main strategies since 2013. Both since 2013 and over the last five years, the annual return before management costs has been 0.19 percentage point higher than the benchmark index. The Executive Board is satisfied with the fund’s performance over time.

The contributions from market exposure and security selection have been positive. With the exception of 2018, the market exposure strategy has contributed positively to the fund’s relative return each year since 2013. The results from security selection have fluctuated somewhat more but have contributed positively in eight of 13 years.

Fund allocation, and real estate investments in particular, have contributed negatively to the fund’s excess return. Since 2017, decisions on whether and how the fund should invest in real estate have been delegated to Norges Bank within the limits for deviation from the fund’s benchmark index.

The Executive Board is not satisfied with the results achieved in real estate investments over time. Real estate returns have been weak, both relative to the equities and bonds sold to fund them and compared with returns in the broader real estate market as measured by a global index. Norges Bank Investment Management made several organisational changes related to real estate management at the beginning of 2025 and began work on adjusting the real estate strategy at the same time.

The Executive Board has now adopted a new strategy for real estate. Norges Bank invests in real estate to achieve the objective of the highest possible return over time. Achieving this goal may also improve the long-term trade-off between return and risk in the fund. To date, the strategy has focused on investing in traditional sectors such as office and retail in predetermined countries and cities. Moving forward, Norges Bank will adopt a broader approach to real estate investments and diversify into more sectors and geographies. Norges Bank will invest more in unlisted real estate through external managers, funds and other indirect investment structures. This will especially apply to investments in new real estate sectors. The Executive Board has further specified that a framework shall be established for the funding of unlisted investments, which includes considerations of the underlying risk of the investment and adjusts for leverage.

Since 2019, the Ministry of Finance has allowed Norges Bank to invest up to 2 percent of the fund in unlisted renewable energy infrastructure. The strategy has been to gradually approach investment opportunities and develop expertise. Norges Bank made few investments during the initial years, but has increased investments based on, among other things, assessments of improved return expectations. Several new investments through 2025, including the fund’s first investment in electricity grids and its first investment in an energy transition fund, contributed to an increase in the share of the fund invested in unlisted renewable energy infrastructure from 0.1 percent to 0.4 percent. The investments are made with a long time horizon, which indicates that results should be assessed over time.

The objective of the highest possible return in the Government Pension Fund Global is to be achieved with an acceptable level of risk. The fund’s risk is measured, analysed and followed up using a broad set of targets and various analytical methods. The management mandate stipulates that Norges Bank shall manage the fund with the aim of ensuring that the expected relative volatility (tracking error) does not exceed 1.25 percentage points. At the end of 2025, the expected relative volatility was 0.37 percentage point, compared with 0.44 percentage point at the end of the previous year.

Measured over the entire period from 1998 to 2025, the realised tracking error has been 0.62 percentage point.

The management of the fund is to be cost-effective. Low costs are not an end in themselves, but cost-effective management contributes to achieving the highest possible return after costs. In the period from 2013 to 2025, annual management costs have been 0.05 percent of assets under management. The Executive Board is satisfied that management costs over time have been low compared to other funds.

Through the fund, we hold a small stake in the world’s largest companies. Responsible investment aims to promote long-term value creation in companies and minimise impact on the environment and society. In this manner, it supports the financial objectives of the fund.

Situations involving war and conflict entail increased risk, and Norges Bank, as manager, must conduct enhanced due diligence. An example of this is the situation in the West Bank and Gaza. Throughout 2025, the Executive Board has further strengthened its monitoring of situations of heightened risk, such as in countries affected by war and conflict. In November 2025, the Ministry of Finance appointed a committee to review the fund’s ethical framework and introduced temporary guidelines that will remain in effect until a new ethical framework has been established. Norges Bank continues to manage the fund in a responsible manner, within the applicable framework.

Norges Bank’s Executive Board

We will be a leader

We live in turbulent and unpredictable times. Often, it is only years later that we truly understand what has transpired and its consequences. In retrospect, events and decisions appear clearer, but in the midst of them, certainty is elusive.

From left: Malin Norberg, Chief Investment Officer Market Strategies – Marthe Skaar, Chief Communications and External Relations Officer – Daniel Balthasar, Co-Chief Investment Officer Active Strategies – Pedro Furtado Reis, Co-Chief Investment Officer Active Strategies – Trond Grande, Chief of Staff/Deputy CEO – Carine Smith Ihenacho, Chief Governance and Compliance Officer – Nicolai Tangen, CEO – Birgitte Bryne, Chief Technology and Operating Officer – Ada Magnæs Aass, Chief Human Resources Officer.

I go on an annual cabin trip with friends, where we attempt to forecast what will happen in the coming year. When we meet the following year, we play back a recording of our predictions. It rarely goes particularly well. Last year, 80 percent of what we predicted turned out to be wrong.

Worse still, if we had correctly predicted everything that happened in 2025, with its constant turmoil and surprises, we would all have believed that the international markets would fall significantly. Instead, they rose steadily throughout 2025, interrupted only by a few brief dips.

Last year was another good year for the Government Pension Fund Global. The fund’s return ended at 15.1 percent, primarily due to a strong upturn in international equity markets. For equity investments, the US technology companies again contributed the most, but financials also had a good year. Despite increases in US tariffs, the total return on fixed income investments was positive.

We can also say that developments in renewable energy infrastructure investments have been positive. After several years of focusing on developing a strong, professional investment department, several major investments were made in 2025, including in Germany’s largest electricity grid.

Over time, we have seen that our real estate investments have not generated the desired returns. In 2025, we therefore felt compelled to change our strategy for these investments and made some organisational changes. I firmly believe that these measures will reverse the negative trend we have seen in recent years.

It is difficult to predict future events with certainty; however, we must none­theless prepare ourselves as best we can. In 2025, we laid the foundation for the years ahead with a new strategy for the period through 2028.

Our ambition is clear, and it is stated on the first page of the strategic document: Norges Bank Investment Management shall be the best and most respected large investment fund in the world.

How are we going to achieve this? Primarily by continuing the good work all our employees do to leverage the fund’s advantages – its size and long-term horizon – while continuing to be among the leaders in finance in the use of technology, particularly artificial intelligence.

Oslo, 27 February 2026Nicolai Tangen
CEO of Norges Bank Investment Management

Strong return on the fund’s investments

The Government Pension Fund Global returned 15.1 percent, or 2,362 billion kroner, in 2025 in accounting terms. This is the fund’s second-highest return in krone terms.

The fund’s value increased by 1,526 billion kroner during the year. Returns and new capital inflows contributed to the growth, while a stronger krone against the currencies the fund is invested in contributed to reducing the value measured in kroner.

The fund’s investments spanned 68 countries and 41 currencies at the end of 2025. Returns are generally measured in international currency – a weighted composition of the currencies in the benchmark index for equities and bonds. This composition is referred to as the fund’s currency basket. At the end of 2025, the currency basket consisted of 34 currencies. Unless otherwise stated, the results in this report is measured in the fund’s currency basket.

TABLE 1 Key figures in billions of kroner.

¹ First unlisted infrastructure investment was made in second quarter of 2021.
² The market value of the investment portfolio is presented before management fee payable/receivable and deferred tax.
³ Total inflow and withdrawal of capital shown in this table is not adjusted for accrued, not paid, management fees.
⁴ Management fees are described in note 12 in the financial statements.
5 Fund return of 2,362 billion kroner includes the accounting effect of changes in recognised deferred tax. The return on the investment portfolios excludes deferred tax and amounted to 2,361 billion kroner.
⁶ Does not include the effect of exchange rate fluctuations on deferred tax.

TABLE 2 The fund's ten largest holdings in percent as at 31 December 2025,
by country.

TABLE 3 Return figures in percent.

CHART 1 The fund’s investments as at 31 December 2025. Equities, unlisted real estate and infrastructure distributed by country and bonds by currency. In percent.

TABLE 4 Return on the fund in percent as at 31 December 2025, measured in various currencies.

¹ Euro was introduced as currency on 01.01.1999. WM/Reuters' euro rate is used as estimate for 31.12.1997.
 

TABLE 5 Historical key figures as at 31 December 2025. Annualised data, measured in the fund's currency basket.

¹ Based on aggregated equity and fixed-income investments until end of 2016.
² The fund's information ratio (IR) is the ratio of the fund's average monthly relative return to the fund's tracking error. The IR indicates how much relative return has been achieved per unit of relative risk.
  

2. Investments

Strong year for equity investments

The fund’s equity investments returned 19.3 percent in 2025. Solid corporate earnings, optimism regarding artificial intelligence and central bank interest rate cuts lifted the equity markets, supported by strong US economic growth. Geopolitical uncertainty and new trade policies caused occasional turmoil; however, the markets quickly recovered and hit new highs.

Our Oslo office.

US technology stocks contributed most to the positive return, driven mainly by the largest technology companies.

Financials perform best

Financials were the best performers in 2025 with a return of 32.4 percent. The valuation of European banks rose as investors became more confident that earnings would remain stable over time. Less regulation and continued high activity in the capital markets also contributed positively to the returns for larger US banks.

Basic materials had the second-highest return at 29.9 percent. Prices for several commodities rose during the year, particularly gold and copper. Increased uncertainty in the global economy and lower interest rates contributed to higher gold prices, while shutdowns at several copper mines pushed copper prices higher.

Telecommunications companies provided the third-highest return at 26.7 percent. The return was largely driven by the South Korean company Samsung Electronics, which operates in several industries. Increased demand for the company’s memory chips, partly driven by the growth of artificial intelligence, contributed to the upturn.

Real estate companies provided the lowest return at 1.6 percent. Developments in the US labour market worried investors. Values fell in parts of the real estate market that are particularly dependent on household consumption, such as residential and self-storage.

Individual investments

At the end of 2025, the fund was invested in 7,201 companies, compared to 8,659 companies in 2024. The decrease was mainly due to changes in the benchmark index for equities.

The investments in the technology companies NVIDIA Corp, Alphabet Inc and Broadcom Inc contributed most to the fund’s return in 2025. The worst-performing investments were in the healthcare companies Novo Nordisk A/S, UnitedHealth Group Inc and the industrial company Fiserv Inc.

The fund participated in a total of 100 initial public offerings. The largest of these were Contemporary Amperex Technology Co, Venture Global Inc and Figma Inc. The offerings in which the fund invested the most were in Medline Inc, Verisure PLC and Alliance Laundry Holdings Inc.

At the end of the year, the fund had holdings of more than 2 percent in 1,000 companies, and more than 5 percent in 68 companies. Its average holding in the world’s listed companies was 1.5 percent.

Excluding listed real estate companies, the fund’s largest single-company percentage holding was in Croda International PLC. The fund’s 9.2 percent stake was valued at 4.7 billion kroner. With the exception of listed real estate companies, the fund may hold no more than 10 percent of the voting shares in a company.

A complete overview of the fund’s equity investments is available
on www.nbim.no.

External managers

Norges Bank Investment Management uses external managers to handle parts of the fund’s equity investments. We use external equity managers in markets and segments where in-depth knowledge of companies, local business conditions and market developments is crucial to making good investment decisions.

At the end of 2025, 1,062 billion kroner, or 5.0 percent of the fund’s assets, was allocated to external managers, up from 994 billion kroner at the start of the year. We awarded 14 new mandates and terminated 17 existing mandates during the year. A total of 111 mandates were managed externally by 103 organisations.

We use external managers for several investment strategies. In emerging markets, we use local equity managers with country-specific mandates. In developed markets in Asia, we use local managers, primarily focused on small-capitalisation companies, while in Europe we use managers with regional mandates. We also employ sector-specific mandates across markets where specialised expertise is particularly valuable. Some managers with European and sector-based mandates are permitted to sell more equities than in the benchmark index they are measured against (long-short mandates). Such positions are nevertheless limited to equities included in the fund's portfolio.

External managers have performed well over time. Since we started investing with external managers in 1998, they have outperformed the market in 25 out of 28 years, after costs. The average annual excess return after costs has been 1.7 percent, increasing the fund’s income by a total of 93 billion kroner after costs.

More information on the use of external managers is available
on www.nbim.no.

TABLE 6 Return on the fund's largest equity investments in 2025 by country.
In percent.

¹ Does not sum up to 100 percent because cash and derivatives are not included.

TABLE 7 Return on the fund's equity investments in 2025. Measured in international currency and sorted by sector. In percent.

¹ Does not sum up to 100 percent because cash and derivatives are not included.

Positive return on fixed income

The fund’s fixed income investments returned 5.4 percent in 2025. The fixed income markets were characterised by significant fluctuations throughout the year, particularly in the first half. US tariffs contributed to increased market uncertainty.

Our Oslo office.

The US Federal Reserve held its policy rate steady throughout the first half of 2025. During the second half, the policy rate was lowered three times, by a total of 0.75 percentage point. The European Central Bank continued the interest rate cuts that began in June 2024, lowering its policy rate by a total of 1.0 percentage point in the first half of the year. The policy rate was held steady for the rest of the year.

Positive returns in the eurozone

Government bonds returned 4.1 percent in 2025 and made up 56.4 percent of fixed income investments.

US Treasuries returned 2.9 percent and accounted for 32.5 percent of fixed income investments. The long-term US yields fluctuated significantly throughout the year and ended slightly lower than at the turn of the year. At the same time, a weaker US dollar lowered returns.

Euro-denominated government bonds returned 8.7 percent and accounted for 10.5 percent of fixed income investments. Despite policy rate cuts, long yields rose throughout the year, steepening the yield curve. The return was mainly driven by a stronger euro.

Japanese government bonds returned -8.8 percent and accounted for 4.6 percent of fixed income investments. The Bank of Japan continued to tighten monetary policy, raising its policy rate twice during the year, to 0.75 percent. Inflation remained well above the central bank’s target of 2 percent, and the markets priced in further interest rate hikes going forward.

TABLE 8 Return on the fund's largest bond holdings by currency in 2025. In percent.

Corporate bonds returned 6.6 percent and accounted for 25.0 percent of fixed income investments. Lower credit premiums, which are the compensation investors demand for holding corporate bonds rather than less risky alternatives, contributed positively to the return.

A complete overview of the fund’s fixed income investments is available on www.nbim.no.

TABLE 9 Return on the fund's fixed-income investments in 2025. Measured in ­international currency and sorted by sector. In percent.

¹ Does not sum up to 100 percent because cash and derivatives are not included.

² Governments may issue different types of bonds, and the fund’s investments in these bonds are grouped accordingly. Bonds issued by a country’s government in the country’s own currency are categorised as government bonds. Bonds issued by a country’s government in another country’s currency are government-related bonds. Inflation-linked bonds issued by governments are grouped with inflation-linked bonds.

Our New York office.

Positive return on real estate investments

The fund’s investments in real estate returned a total of 0.2 percent and accounted for 3.1 percent of the fund at the end of 2025. Unlisted real estate investments returned 4.4 percent, and listed real estate investments -4.0 percent.

In 2025, we invested in a logistics portfolio in the US, comprising 48 buildings, in a new joint venture with Goodman Group.

The fund’s real estate strategy covers both unlisted and listed real estate investments. Altogether, these investments amounted to 668 billion kroner at the end of the year.

In 2025, we established a new strategy for real estate investments, which will take effect from 2026. The strategy involves a gradual transition from geographical concentration to broader sector diversification across different types of real estate. We will delegate more of the operational management of the properties, and an increasing share of investments will be made through indirect structures, such as funds that invest in real estate. Real estate management was reorganised during the year to support the implementation of the new strategy.

We will continue to gain exposure to the real estate market through both listed and unlisted real estate investments. Our long investment horizon makes us well-suited to handle higher short-term fluctuations in the listed real estate portfolio.

TABLE 10 Value of real estate investments in millions of kroner
as at 31 December 2025.

¹ Including bank deposits and other receivables

Unlisted real estate

The fund’s investments in unlisted real estate had a market value of 372 billion kroner at the end of 2025, equivalent to 1.7 percent of the fund and 55.7 percent of our total real estate investments.

The fund’s unlisted real estate investments are primarily in office, retail and logistics properties. Office properties account for about half of the portfolio.

Liquidity in the real estate market improved in 2025 compared with previous years. Transaction volumes continued to pick up in most markets. Real estate prices stabilised in traditional sectors such as office and retail, while investors increasingly invested in newer sectors with higher growth, such as data centres.

In 2025, we signed an agreement to acquire a 95 percent interest in an office property located at 1177 Avenue of the America’s in New York City.

Activity was high in 2025, with investments across various sectors. Several of the transactions initiated at the end of 2024 were completed in 2025.

The management mandate from the Ministry of Finance to Norges Bank sets an upper limit for unlisted real estate investments of 7 percent of the fund’s value.

TABLE 11 Return on the fund's unlisted real estate investments in percentage points.

TABLE 12 The fund's largest unlisted real estate investments as at 31 December 2025

¹ Excluding investments in logistics

TABLE 13 Return on the fund's unlisted real estate investment by market as at 31 December 2025. In percent.

CHART 15 The fund’s unlisted real estate investments by sector as at 31 December 2025.

¹ Other sectors, bank deposits and other claims.

Listed real estate

Investments in listed real estate made up 1.4 percent of the fund and 44.3 percent of our total real estate investments at the end of 2025, spread across 44 companies.

The largest percentage stakes were 25.2 percent of the listed real estate company Shaftesbury Capital PLC and 14.0 percent of Vonovia SE. The single largest investment was in Welltower Inc at 54.9 billion kroner.

A complete overview of the fund’s real estate investments is available on www.nbim.no.

TABLE 14 Owenship shares in percent for the 10 largest listed investments in real estate management as at 31. desember 2025.

¹ The ownership shares also include holdings that are a part of the equity management.

TABLE 15 The fund's largest listed investments in real estate management.
In millions of kroner as at 31 December 2025.

¹ The holdings also include holdings that are part of the equity management.

Unlisted renewable energy infrastructure

Investments in unlisted renewable energy infrastructure returned 18.1 percent and accounted for 0.4 percent of the fund at the end of the year.

The return comprises the net income from these assets and the change in their value during the period. Expected future power prices, production volumes and capital costs impact valuations. The value of the assets also falls over time as their expected remaining life decreases.

TABLE 16 Investments in unlisted renewable energy infrastructure in millions of ­kroner as at 31 December 2025.

¹ Including bank deposits and other receivables.

TABLE 17 Investments in unlisted renewable energy infrastructure in percent as at 31 December 2025.

In the initial years, we made few investments. We have since increased our investment activity, partly based on assessments of improved return expectations. During the year, asset valuations rose, and new investments were made at attractive prices. Currency effects and net income also contributed positively to the results.

In 2025, we made significant investments to expand and diversify our portfolio in offshore wind and electricity transmission. We acquired ownership interest in two offshore wind projects under construction from RWE – Thor in Denmark and Nordseecluster in Germany. We also invested in TenneT Germany, which operates Germany’s largest electricity grid. This was our first investment in electricity grids. In addition, we committed capital to the Brookfield Global Transition Fund II. This was our first investment in an energy transition fund and gave us exposure beyond our direct investments in Europe. Through these transactions, we have in 2025 tripled the capital we have committed to investments in unlisted renewable energy infrastructure.

The management mandate from the Ministry of Finance sets an upper limit for investments in unlisted renewable energy infrastructure of 2 percent of the fund’s value.

A complete overview of the fund’s investments in unlisted renewable energy infrastructure is available on www.nbim.no.

Global investments

Number of investment by asset class

Investment risk

A large, global fund with an equity share of 70 percent will normally experience significant fluctuations in return and market value. This is a risk we must be prepared for in the management of the fund.

Risk management and volatility

The risk in the fund is largely driven by how much of it is invested in equities and how global equity markets develop. Movements in interest rates, credit risk premiums and exchange rates will also affect risk, as will changes in the value of investments in real estate and unlisted renewable energy infrastructure. As an investor, we must continuously monitor and manage these risks. This requires sound risk management, a comprehensive understanding of the markets and robust systems and analyses.

Measuring and managing the fund’s risk exposure is a challenge. To obtain a full picture, we therefore use a variety of risk analyses and calculations. We monitor various aspects including concentration risk, expected fluctuations in markets and fund value, exposure to different risk factors and liquidity risk. We also perform stress tests and hypothetical scenario analyses on the portfolio. Some investment strategies can expose the fund to an increased risk of rare but large and unpredictable losses, and so we closely monitor exposure to strategies of this type.

Expected absolute volatility is a measure of how much the return on the fund’s investments can normally be expected to fluctuate in the course of a year. The calculation is based on historical price changes over the last three years. At the end of 2025, the fund’s expected absolute volatility was 10.9 percent, or approximately 2,300 billion kroner. This means that the fund’s value can be expected to fluctuate by more than 2,300 billion kroner in one out of every three years.

CHART 18 Excepted absolute volatility for the fund. Percent (left-hand axis) and billions of kroner (right -hand axis).

Scenario analyses

Every year, we publish hypothetical scenario analyses that show how different developments could affect the value of the fund. The scenarios are adjusted from year to year in line with market developments and events that impact the global economy. This year, we analyse how a combination of high valuations of AI-related companies, high debt levels and increased geopolitical tensions could lead to significant reductions in value over time. We also include a climate-related scenario that highlights how global shocks to food supply can impact financial markets, and how environmental events are becoming increasingly economically significant.

This year’s scenarios build on the analyses from 2024. The AI scenario is a continuation of last year’s analysis. In this scenario, we place particular emphasis on increased investments and a high concentration of AI-related stocks in the market. In the fragmented-world scenario, the global economy fragments into several blocs. This has major consequences for economic growth and risk premiums. In the regional debt crisis scenario, we model a loss of investor confidence, where government bonds are no longer perceived as the safest investments. In the climate scenario, extreme weather events trigger crop failures across several major food-producing regions simultaneously. This leads to inflation and lower growth.

We have analysed how these scenarios might affect the fund’s value, calculating potential losses in the short to medium term. Losses in equity markets are significant across all scenarios, while the effect on the fixed-income market varies. The fragmented-world scenario produces the heaviest losses, with a 37 percent decline in the fund’s value.

A full report on stress testing is available on www.nbim.no.

CHART 19 Estimated value of the fund under each scenario and potential losses in percent.

The fund’s relative return

We aim to leverage the fund’s long-term investment horizon and considerable size to generate a high return with acceptable risk. In 2025, the fund’s return was -0.28 percentage point lower than the return on the benchmark index.

The return on the fund’s investments is measured against the benchmark index set by the Ministry of Finance, which is made up of global equity and bond indices. The equity portion of the benchmark index is based on the FTSE Global All Cap Index and comprised 7,397 listed companies at the end of 2025. The bond portion of the benchmark index is based on indices from Bloomberg and comprised 19,193 bonds from 2,543 issuers.

At the end of the year, the fund was invested in 7,201 listed companies and 7,600 bonds from 1,618 issuers. The fund also had 1,389 investments in unlisted real estate and 13 investments in unlisted renewable energy infrastructure. To achieve the objective of the highest possible return after costs, we delegate responsibility for individual investments to our portfolio managers via individual investment mandates. The mandates are awarded within the fund’s three main strategies: market exposure, security selection and fund allocation. This approach gives us in-depth knowledge of selected market segments and companies, and makes us a better responsible investor. At the end of the year, we had 281 individual equity and bond mandates, of which 111 were assigned to external equity managers. The mandate structure provides effective management and control over risk, return, costs and incentives for each investment mandate.

Our Oslo office.

The fund’s investments in real estate and unlisted renewable energy infrastructure are not included in the benchmark index set by the Ministry. These investments are funded by selling equities and bonds from the benchmark index. Which equities and bonds are sold depends on the country and currency in which the investment is made. When we measure the relative return on equity and bond management, we use the benchmark index adjusted for the equities and bonds we have sold to fund investments in real estate and unlisted renewable energy infrastructure. The return on real estate and infrastructure investments is measured against the equities and bonds sold to fund them.

In 2025, the fund’s return was -0.28 percentage point lower than the return on the fund’s benchmark index. However, the fund has outperformed the benchmark index by 0.24 percentage point annually since 1998, 0.19 percentage point over the past decade, and 0.19 percentage point over the past five years.

TABLE 18 Relative return in 2025. .

CHART 20 Annual relative return and accumulated annualised relative return in percentage points. Calculations based on aggregated equity and fixed-income investments until end of 2016.

Equity management

Equity management is measured against the equity portion of the benchmark index, adjusted for sales of equities to fund investments in real estate and renewable energy infrastructure. The return on equity management was 0.09 percentage point higher than the adjusted benchmark index for equities in 2025, contributing 0.07 percentage point to the fund’s total relative return. Investments in the technology and finance sectors made the most positive contribution to the results. Both sectors were characterised by significant fluctuations throughout the year. Investments in health and materials made the largest negative contribution, particularly due to certain investments in the US. Among the countries in which the fund invested, equities in South Korea, the UK and Taiwan contributed most positively, while investments in Germany and the US contributed most negatively.

Since 1999, the annual relative return on equity management has been 0.44 percentage point higher than the benchmark index. Over the last decade, it has been 0.31 percentage point higher, and over the last five years, 0.33 percentage point higher.

Fixed income management

Fixed-income management is measured against the bond portion of the benchmark index, adjusted for sales of bonds to fund investments in real estate and renewable energy infrastructure. The return on fixed income management was 0.54 percentage point higher than this adjusted benchmark index in 2025, contributing 0.16 percentage point to the fund’s relative return. The management of government bonds contributed positively, partly due to different positioning along the yield curve and a higher running yield in the portfolio than in the benchmark index. The fund also made investments in government bonds in emerging markets, which contributed positively to the relative return. Investments in corporate bonds contributed marginally to the results.

Since 1998, the annual relative return on fixed income management has been 0.25 percentage point higher than the benchmark index. Over the last decade, it has been 0.45 percentage point higher, and over the last five years, 0.60 percentage point higher.

Real estate

The fund’s real estate strategy covers both unlisted and listed real estate investments. The relative return from real estate management is measured as the difference between the return on real estate investments and the returns on the bonds and equities sold to fund them. Real estate management contributed -0.46 percentage point to the fund’s relative return in 2025. Listed real estate investments made a negative contribution of -0.31 percentage point. The portfolio underperformed the broad listed real estate market, with the largest negative contributions coming from investments in listed residential property in Europe and the US, and in US data centres. Unlisted investments made a negative contribution of -0.15 percentage point. Unlisted real estate investments returned 4.4 percent, with US office buildings performing poorly, while European investments returned 5.2 percent.

We report unlisted real estate returns quarterly and annually, but it is important to assess the real estate strategy over a longer period. From the fund’s first unlisted real estate investment in 2011 through to the end of 2016, the annual return on unlisted real estate investments was 5.98 percent. During this period, real estate investments were funded through bond sales. Bond investments yielded an annual return of 4.37 percent during the same period. From 2017 to 2025, the annual return on unlisted real estate investments was 2.75 percent. During this period, investments in unlisted real estate were funded through the sale of both equities and bonds. These investments had an annual return of 4.89 percent during the same period.

More information about the relative return of the real estate management is available on the fund’s website.

Unlisted renewable energy infrastructure

The fund’s strategy is to build a diversified portfolio within renewable energy infrastructure across multiple technologies and geographical areas. We invest directly in wind and solar power, and will increase our investments in distribution and storage as opportunities arise. We will gradually increase our investments through indirect structures, such as funds that invest in renewable energy projects. The relative return on investments in renewable energy infrastructure is measured as the difference between the return on these investments and the return on the bonds and equities sold to fund them. In 2025, investments in renewable energy infrastructure returned 18.1 percent. Offshore wind projects under construction contributed most positively. Since its inception in 2021, the strategy has produced an annual return of 4.2 percent.

TABLE 19 Relative return on the fund's asset management in percentage points.

¹ Includes real estate management from 2017. The fund's relative return prior to 2017 is calculated on equity and fixed-income management only.

² Measured against actual funding from 2017. The relative return on equity and fixed-income management before 2017 is measured against the respective Ministry of Finance asset class indices.

³ The relative return on the fund and fixed-income management for 2021 have been adjusted by 0.01 percentage point as a result of an update of the return on the benchmark index.

Investment strategies

We employ a range of investment strategies in our management of the fund. These are grouped into three main strategies: market exposure, security selection and fund allocation. The strategies cut across equities, fixed income, real estate and infrastructure management.

The market exposure strategy consists of positioning and securities lending. Overall, these strategies contributed 0.22 percentage point to the fund’s relative return in 2025. Positioning is about implementing market exposures in ways that increase investment returns and reduce transaction costs. This is done partly by exploiting relative valuations across instruments and issuers, and the pricing effects of company and market events. This includes positioning based on interest rate levels, inflation, exchange rates and interest rate differentials between countries. Equity positioning contributed 0.08 percentage point. Investments in US and Chinese equities made the largest contribution. Fixed-income positioning contributed 0.10 percentage point, with positive contributions across all regions, led by Europe. Securities lending contributed 0.04 percentage point to the fund’s relative return, most of which came from lending out equities.

The strategy for security selection is based on a thorough analysis of the fund’s largest investments. The objective is to improve returns and enhance our role as a responsible and active owner. The strategy contributed -0.01 percentage point to the fund’s relative return in 2025. Internal stock selection contributed -0.03 percentage point. North American equities made the largest negative contribution to the results, particularly due to investments in health and telecommunications. Investments in financials made the most positive contribution. External stock selection contributed 0.02 percentage point. Investments in China boosted the results, while investments in the Middle East and emerging markets in Europe had a negative impact. When it comes to fixed-income management, security selection focuses on corporate bonds. The strategy marginally improved the fund’s relative return in 2025.

The fund allocation strategy comprises various strategies that aim to improve the trade-off between return and risk in the fund over time. The strategy contributed negatively by -0.49 percentage point to the fund’s relative return in 2025.

Investments in real estate and renewable energy infrastructure are reported under fund allocation. Real estate investments contributed -0.46 percentage point to the fund’s relative return, while investments in renewable energy infrastructure contributed 0.04 percentage point.

Throughout 2025, the fund was underweight in equities and overweight in bonds relative to the reference index, especially in emerging markets. We also had a lower weighting for the largest US technology companies in the fund allocation strategy. Overall, such fund allocation decisions contributed -0.07 percentage point to the fund’s relative return in 2025.

TABLE 20 Contributions to the fund's relative return from investment strategies in 2025. In percentage points.

TABLE 21 Contributions to the fund's relative return from investment strategies annualised for 2013-2025. In percentage points.

¹ Market exposure includes -0.01 percentage point from the systematic factors strategy which was ended in the second quarter of 2020.

² Regulations for Environmental related mandates for equities and fixed income were changed by the Ministry of Finance during 2022. The historic performance impact from Environmental related mandates until 2022 is included under Allocations.

³ Specific allocation to Systematic factors was ended in 2022. The historic performance impact from Systematic factors is included under Allocations.

Risk relative to the benchmark index

The fund is invested differently to its benchmark index along various dimensions, including asset classes, currencies, sectors, countries, regions, individual stocks and individual bond issuers.

Real estate investments constituted one of the fund’s largest relative exposures. The fund had 372 billion kroner invested in unlisted real estate and 296 billion kroner in listed real estate. At the end of 2025, the equity portfolio had a higher weighting in volatile companies and companies with lower current dividends than the benchmark index. The fixed income portfolio had greater exposure to emerging-market and government-related bonds than the benchmark index. The fund also had an underweight in equities versus bonds.

The Ministry of Finance and the Executive Board of Norges Bank have set limits on how much the fund’s investments can deviate from the benchmark index.

One of the limits concerns expected relative volatility, or tracking error, which puts a ceiling on how much the return on the fund’s investments can be expected to deviate from the return on the benchmark index. All of the fund’s investments are included in the calculation of expected relative volatility in accordance with the mandate and are measured against the benchmark index, which consists of global equity and bond indices. The fund is to aim for expected relative volatility of no more than 1.25 percentage points. At the end of 2025, the fund’s expected relative volatility was 0.37 percentage point, down from 0.44 percentage point the previous year. The decline is mainly due to reduced expected relative volatility in equity investments.

Real estate investments made the largest contribution to expected relative volatility in 2025. These investments are expected to have a different return profile than equities and bonds, both in the short and long term. This has an impact on the calculation of the fund’s expected relative volatility. As daily pricing is not available for our unlisted real estate investments, we use a model from MSCI to calculate the relative risk for these investments.

The Executive Board of Norges Bank has also set a limit for the expected shortfall between the return on the fund and return on the benchmark index in extreme situations. This limit, known as extreme deviation risk, is set at 3.75 percentage points. At the end of the year, it was 1.01 percentage points, down from 1.18 percentage points the previous year.

More information on risk and exposure for the fund is available on the fund’s website.

TABLE 22 Key figures for the fund's risk and exposure.

¹ Derivatives are represented with their underlying economic exposure.

² Investments in listed and unlisted real estate companies are exempt from this restriction.

TABLE 23 Expected relative volatility of investment strategies as at 31 December 2025. Each strategy measured stand-alone with the other strategies positioned in line with the benchmarks. All numbers measured at fund level in basis points.

Responsible investment report

Responsible investment of the Government Pension Fund is presented in a separate report, which is available on the fund’s website www.nbim.no.

3. Organisation

Our New York office.

Management organisation

Our employees are the heart of the organisation

Our employees are our most important resource. We shall retain, develop and attract the top talent. We aim to ensure that everyone can work efficiently and innovatively and has the skills to take on new challenges.

Our Singapore office.

We are a global investment organisation. At the end of 2025, we had 678 employees working in our offices in Oslo, London, New York and Singapore. We also have a real estate office in Paris. Close collaboration across these offices is essential for achieving the fund’s objective of the highest possible return.

In spring 2025, we started a process to close our real estate office in Tokyo. As part of a strategic review, expanding our Japan real estate portfolio is no longer a priority. Investments in Japan remain unchanged. It was also decided to gather our Europe real estate team in one location, in London. As a result, we initiated a process to close our dedicated real estate office in Paris.

2025 marked the end of the 2023–2025 strategic period. The strategy was based on the fund’s distinctive characteristics as a large, long-term investor, with the objective of achieving the highest possible return in a responsible manner. It had five main areas: investments, technology, operational robustness, people and communication. Throughout the period, we have strengthened our contrarian investment culture, made greater use of new technologies and integrated artificial intelligence as a key tool to improve decision-making, strengthen risk management and increase efficiency. At the same time, we have made the organisation more robust and invested purposefully in our employees’ skills and development. Additionally, we have enhanced transparency in our investments and further developed our communication with stakeholders. More information about what we have achieved during the strategic period is available on the fund’s website.

Learning and development opportunities

We believe in lifelong learning and give our employees the opportunity to build relevant skills throughout their careers. We work systematically on developing leaders and other staff by offering a variety of learning and development opportunities. We have a continuous development process where employees and their leaders set clear targets and expectations together.

Artificial intelligence (AI) is changing the way we work – both individually and collectively. To enhance our productivity and decision-making ability, we launched Tech Year 2025 – a comprehensive initiative to develop technological skills throughout the organisation, with a particular focus on AI. The approach combined mandatory training, hackathons, workshops and technology days at all offices. We also launched a network of 71 AI ambassadors to provide guidance and support across the organisation. The AI initiative evolved throughout the year from experimentation and skills development to identifying and further developing solutions that provide the greatest value to the organisation. All employees now actively use AI tools in their daily work. In an internal survey, employees report an average productivity increase of 20 percent when using AI tools.

For the third year in a row, we held an Investment Academy to boost investment skills, value chain understanding and collaboration across the organisation. The programme is led by our own experts, and the feedback has been very positive.

Through our learning platform, we offer digital courses customised to the organisation. In 2025, employees completed over 3,500 such courses. Employees also have access to 10,000 online courses from leading universities and organisations.

Feedback is a key component of our organisational culture and is important for professional development. In 2025, we broadened our training on giving and receiving feedback with exercises based on specific work situations. Each year, leaders and employees conduct 360-degree evaluations in which everyone receives constructive feedback from their colleagues. In 2025, we moved from anonymous to open feedback. This led to a 64 percent increase in the number of requests for feedback.

Graduates of 2025.

We continue to prioritise our mentoring scheme, which provides employees with guidance from experienced colleagues or external professionals. The purpose is to promote new perspectives across the organisation and support personal development.

Our leaders are crucial in building a strong learning culture. They set the direction, guide employees and facilitate high performance and innovation. We set clear expectations for them and arrange regular forums, including annual leadership gatherings. New managers complete an induction programme, and all leaders receive training in topics such as psychological safety, feedback, stress management and mental resilience.

Information and recruitment

We are keen to give young people a better understanding of the world of finance. In 2025, we gave 47 guest lectures at Norwegian and international universities and colleges. The aim was to give students an insight into investment management in practice and increase knowledge about the fund.

We work systematically to recruit the best candidates both in Norway and internationally, and seek talent with varied skills and backgrounds. In 2025, we saw a significant increase in the number of applicants compared with the previous year, including continued high applicant numbers for the graduate and summer internship programmes.

CHART 22 Number of applications for our graduate and summer internship ­programmes.

Diversity, equality and working environment

We aim to be an inclusive organisation with a diversity of mindsets, ethnicities, age groups, academic backgrounds and life experience. This brings a broader perspective, increases creativity and enables us to make better decisions.

We have extended our range of social activities to encourage a greater sense of community. We marked various international awareness days and events during the year, including Pride and International Women’s Day. To ensure a safe and inclusive working environment, we have a network of mental health first aiders at all our offices.

We are working actively to increase the share of women in the organisation as a whole and in senior management positions. In 2025, we continued to support the Women’s Investment Club at universities and colleges in Norway and internationally. The aim is to inspire and motivate more people to pursue careers in finance.

Norges Bank is also one of the initiators of the Women in Finance Charter, and in 2025, we hosted the Charter’s fourth status report. Our target is at least 40 percent women in Norges Bank as a whole, in senior management positions, and in specialist positions. Our commitments under the Charter’s four principles are published on the fund’s website www.nbim.no. Although we have a healthy gender balance in some areas, we still have some way to go to increase the proportion of women in senior management positions and senior specialist positions.

TABLE 24 Gender balance by management level as at 31 December 2025. In percent.

To ensure that we are consistent and fair in our approach to employees’ progression, promotion and remuneration, different areas of the organisation have their own career ladders. Each ladder can have up to five different grades with consistent job titles. Each grade reflects the expectations associated with the role that are to be met regardless of which area the employee works in.

The 2025 people survey revealed high levels of engagement in the workforce, and during the year, we changed suppliers to enhance follow-up. Reputation and job content are cited as the most important drivers of engagement and motivation. Job content includes tasks that are engaging, offer professional challenges and allow for independence.

TABLE 25 Gender balance by grade and office as at 31 December 2025. In percent.

Remuneration system

Norges Bank’s Executive Board sets limits for our remuneration system and monitors its implementation. Pay levels are to be competitive but generally not market-leading. Salaries are set individually and reflect the position’s responsibilities and the employee’s skills, experience and achievements. Total remuneration paid includes fixed salary and any performance-based pay, overtime pay and travel time pay.

In keeping with the management mandate from the Ministry of Finance, the remuneration system complies with the requirements of the regulations issued under the Securities Funds Act with necessary adjustments. The Executive Board’s Remuneration Committee is to contribute to thorough and independent consideration of matters concerning Norges Bank’s remuneration arrangements. Norges Bank’s Internal Audit unit also issues an independent statement on compliance with rules and guidelines on remuneration. The review in 2025 confirmed that the remuneration system was operated in line with applicable rules in 2024.

Members of the leader group receive only a fixed salary. The CEO’s salary and pay bands for other members of the leader group are set by the Executive Board.

TABLE 26 Fixed salary and other key information for senior management in 2025.

1 Receives a salary in pounds sterling. The amount shown includes the currency effect when translating into kroner

2 Transferred to another position within Norges Bank Investment Management on 19.11.2025. Remuneration is shown up until this date.

TABLE 27 Remuneration of senior management in 2025. In kroner.

¹ Receives a salary in pounds sterling. The amount shown includes the currency effect when translating into kroner

² Members of the Norges Bank Investment Management leader group only receive a fixed salary. Members of the leader group that previously were entitled to performance-based pay are no longer a part of this arrangement, but over the coming years will receive accrued performanve-based pay that has been held back. The amounts reported in the table are performance-based pay disbursed during the financial year, but accrued and expensed in earlier periods.

³ Transferred to another position within Norges Bank Investment Management on 19.11.2025. Remuneration is shown up until this date.

⁴ Consist mainly of personnel insurance and electronic communication tools.

⁵ Paid salary includes holiday pay from performance-based salary.

A total of 1,299 million kroner was paid in fixed salaries to 786 employees in 2025: 66 million kroner to senior management, 541 million to employees entitled to performance-based pay and 692 million kroner to other employees.

Fixed salary at subsidiaries

A total of 53 million kroner was paid in fixed salaries to 28 employees of subsidiaries linked to the management of the real estate portfolio during the year: 44 million kroner to employees entitled to performance-based pay and 9 million kroner to other employees.

Performance-based pay

In addition to their fixed salary, those who work directly on investment decisions may qualify for performance-based pay. This is calculated on the basis of the performance of the fund, group and individual measured against agreed qualitative and quantitative targets. Results are measured over a period of at least two years.

The limit for performance-based pay is generally a maximum of 100 percent of fixed salary. For a limited number of employees at the overseas offices, however, the limit may be 200 percent of fixed salary. Employees eligible for performance-based pay accrued an average of 54 percent of the overall limit for 2025 based on multi-year performance. A total of 362 million kroner was paid in performance-based pay to 229 employees during the year.

As a general rule, accrued performance-based pay is paid over several years, where up to half is paid the year after it is accrued. The remainder is held back and paid over the following three years. The amount held back is adjusted according to the return on the fund.

CHART 26 Performance-based pay ­relative to upper limit in 2025. ­Percentage of employees entitled with performance-based pay.

Performance-based pay at subsidiaries

A total of 15 million kroner was paid in performance-based pay to 20 employees at subsidiaries linked to the management of the real estate portfolio.

Equal pay

To ensure fair pay practices, we regularly analyse pay trends among our employees. Any significant discrepancies at the level of the individual or group are investigated further to ensure that gender-neutral criteria have been applied.

The analysis shows no significant pay differences between women and men in comparable positions and roles. The pay differences increased marginally from 2024, primarily due to changes in the composition at different career levels. Pay gaps between women and men at the level of the organisation are a result of men being over-represented in positions working on investment decisions. Positions with investment responsibilities are generally better paid in the market than positions at the same grade in other areas. A larger share of men than women at senior grades also contributes to differences at the level of the organisation.

TABLE 28 Unajusted pay gap between women and men in percent.¹

1 Unajusted pay gap between women and men reflects the disparity in earnings without adjusting for factors such as working hours, occupation, age, experience, education level, or other variables that could impact total pay gaps.

Our New York office.

For data protection reasons, there must be at least five members of each gender at each grade for pay data to be published.

TABLE 29 Fixed salary by grade at the Oslo office as at 31 December 2025.

TABLE 30 Total remuneration paid by grade at the Oslo office as at 31 December 2025.

Operational risk

Norges Bank’s Executive Board sets limits for operational risk management and internal controls at Norges Bank Investment Management. We work systematically to identify operational risk and improve our processes.

Our Oslo office.

The Executive Board has decided that there must be less than a 20 percent probability that operational risk factors result in gains and losses totalling 1 billion kroner or more over a 12-month period. This is referred to as the Executive Board’s operational risk tolerance. Our estimated operational risk exposure was within this limit throughout 2025.

Unwanted incidents in 2025

A total of 178 unwanted incidents were recorded in 2025, up from 175 the previous year. Most of these events had no financial consequences. Altogether, unwanted incidents had an estimated financial impact of 142 million kroner. Nine of the incidents were considered significant.

The significant incidents accounted for approximately 110 million kroner of the total financial impact. Five of the incidents involved failures in IT systems and systems availability. Two incidents were linked to external parties – one to cloud infrastructure and the other to a breach of mandate by an external manager. One incident concerned a failure in an internal portfolio management process, and one resulted from human error during a network change.

Compliance with guidelines

The Ministry of Finance has issued a mandate for the management of the Government Pension Fund Global. No material breaches of the mandate were registered in 2025. Norges Bank Investment Management did not receive any notifications from local supervisory authorities of any significant breaches of market rules or general legislation.

CHART 27 Unwanted events at Norges Bank Investment Management by cause.

Cyber risk

Attempted cyber attacks pose a significant risk to Norges Bank Investment Management. The security policy landscape is changing rapidly, and the malicious use of AI is making cyber attacks both more effective and easier to scale.

In 2025, we saw how AI is amplifying established attack methods. This includes more convincing social manipulation across languages, faster identification of vulnerabilities and increased use of attacks targeting supply and value chains. At the same time, some criminal groups are increasingly operating on behalf of state actors, making it more difficult to distinguish between financially and politically motivated attacks.

Several processes and controls are in place to reduce cyber risk. No significant incidents related to information security were identified in 2025.

Our New York office.

Low costs

We maintain a high level of cost awareness in our management of the fund and work continually to automate processes and streamline operations to realise economies of scale.

Our Singapore office.

High returns, responsible investment and transparency are important priorities for the fund. We leverage the fund’s characteristics as a large and long-term investor to achieve the highest possible returns in a responsible manner. At the same time, we want to ensure cost-effectiveness without compromising the opportunity to create added value in the management of the fund. We must also ensure sound control, good risk management and operational robustness in a time of geopolitical uncertainty and a more complex risk landscape. 

Internal management costs as a share of assets under management have been stable or somewhat declining in recent years. We work systematically to automate processes and streamline operations to realise economies of scale. In recent years we have carried out a range of initiatives to support this work. The management of the fund should be cost-effective, but low costs are not a goal in itself. The fund’s objective as set out in the management mandate from the Ministry of Finance is to generate the highest possible return, net of costs, measured in the investment portfolio’s currency basket, within the applicable investment management framework. 

The fund’s management costs measured as a share of assets under management are low compared to other funds. Management costs at Norges Bank amounted to 0.038 percent of assets under management in 2025. Annual analyses prepared by CEM Benchmarking Inc. for the Ministry of Finance show that the fund has had lower costs than all other funds in the peer group over time. Management costs have been between 11 and 19 basis points lower than the peer group since 2012. The comparison takes into account differences in fund size and the allocation to different asset classes. The CEM report is considered the best source of comparable information on cost levels in asset management. 

Management costs

Management costs comprise all costs relating to the management of the fund. These are mainly incurred at Norges Bank, but also at subsidiaries established to manage the fund’s investments in unlisted real estate and unlisted renewable energy infrastructure. See note 12, as well as table 6.4 and table 7.4 in the financial statements for additional information related to costs at Norges Bank and subsidiaries.

Total management costs at Norges Bank were 7.5 billion kroner in 2025, up from 7.4 billion kroner in 2024. The increase was due to higher salary and personnel costs and increased base fees to external managers. This was partly offset by lower performance-based fees to external managers and currency effects. The increase in salary and personnel costs was mainly due to an accounting transition effect related to a change in practice for payment of performance pay, resulting in a change in periodisation. As a result, personnel costs increased by 235 million kroner in 2025. The change does not impact accrued performance pay and has limited impact on amounts paid. Excluding this transition effect, total management costs would have been somewhat lower than in 2024. Base fees to external managers increased due to higher average assets under external management in 2025. Performance-based fees to external managers were lower, due to lower excess returns for some external managers. 

Each year, the Ministry of Finance sets an upper limit for the reimbursement of management costs. Norges Bank is only reimbursed for costs incurred up to this limit. Management costs at subsidiaries are measured against the upper limit but are not reimbursed, as they are expensed directly in the portfolio result. Norges Bank is also reimbursed for performance-based fees to external managers. These fees are not included in the limit. Total management costs incurred at Norges Bank and subsidiaries, excluding performance-based fees to external managers, were limited to 8.1 billion kroner for 2025. Management costs measured against this upper limit amounted to 6.6 billion kroner. These comprised management costs at Norges Bank, excluding performance-based fees to external managers, of 6.4 billion kroner and management costs at subsidiaries of 0.2 billion kroner. This corresponds to 0.033 percent of assets under management, down from 0.034 percent in 2024. 

Fixed and variable fees to external managers accounted for 39 percent of management costs in 2025. We use external equity managers in markets and segments where we believe they will enhance returns. Our strategy is to use external managers primarily for equity investments in emerging markets. The use of external managers has played an important role in achieving the fund’s objectives. From inception in 1999 until the end of 2025, the cumulative excess return after costs from external equity mandates was approximately 93 billion kroner. 

A share of the fees to external managers varies with the excess return achieved relative to a benchmark index. Agreements with external managers regarding performance-based fees are structured so that the majority of the excess return is retained by the fund, and the agreements include caps on the fees that can be paid. Performance-based fees to external managers will increase when excess returns increase. 

The fund’s investments in equities and bonds must be registered with local securities depositories around the world. We use a global custodian institution to assist us with this process. Custody costs as a share of assets under management have fallen in recent years and accounted for 6 percent of management costs in 2025. 

The fund’s reporting currency is the Norwegian krone. Exchange rate fluctuations can have a significant accounting impact even if actual costs in foreign currency remain unchanged. Over 75 percent of costs are invoiced and paid in foreign currency. For example, a 25 percent change in the value of the krone against all other currencies would in isolation change management costs by around 1,800 million kroner. The weakening of the krone in recent years has therefore contributed to higher costs measured in kroner.

CHART 28 Management costs as a share of assets under management in basis points.

CHART 29 Development of individual cost components. Costs¹ (millions of kroner, left-hand axis) and average market value (billions of kroner, right-hand axis).

¹ Excluding performance-based fees and subsidiaries.

Management costs broken down by investment strategy

We pursue different investment strategies in our management of the fund. These strategies complement and influence one another, and there are cost synergies between them. Costs are allocated to the different strategies either based on actual costs or using allocation keys such as number of employees or transaction volumes.

TABLE 31 Management costs in basis points per investment strategy in 2025. Costs as reimbursed by the Ministry of Finance.

¹ Includes all externally managed capital.

TABLE 32 Management cost per investment strategy 2013-2025. Costs as reimbursed by the Ministry of Finance. Basis points.

¹ Includes all externally managed capital.
² Unlisted real estate is part of the Fund allocation strategy from 2017, but is presented on a separate line for 2013-2025.

Transaction costs

Transaction costs are defined as all costs associated with transactions that directly impact the portfolio result. Both direct and indirect transaction costs are incurred. For equities and bonds, direct transaction costs normally consist of commission fees and transaction taxes, including stamp duty. For unlisted real estate and unlisted renewable energy infrastructure, they include one-off costs for the purchase and sale of investments, including stamp duty, registration fees, due diligence costs and insurance. 

We work continuously to keep direct transaction costs low. We do this by analysing our trades and taking transaction costs into account in our investment strategies, thereby reducing the number of transactions. There may therefore be lower activity in markets with high commissions or taxes, than in markets with lower fixed transaction costs. We also choose counterparties that can execute our investment decisions cost-effectively. Transaction costs amounted to 7.7 billion kroner in 2025, compared to 6.1 billion kroner in 2024. Of this, 6.7 billion kroner was related to equity investments, 0.7 billion kroner to investments in unlisted real estate and 0.3 billion kroner to investments in unlisted renewable energy infrastructure. 

In addition to direct costs, indirect costs are incurred when we invest. These arise as a result of price fluctuations from the time the trade is initiated in the market until it is implemented. Indirect costs are included in the portfolio result and are estimated at 14.5 billion kroner for internal equity investments in 2025, compared to 16.0 billion kroner in 2024. Despite higher activity in 2025, indirect transaction costs were reduced due to broad cost-reduction measures and some improvement in market conditions. 

4. Financial statements

Our London office.

Income statement

Balance sheet

Statement of cash flows

¹ Management fee in the statement of cash flows consists of transfers to/from the krone account in connection with the settlement of management costs incurred in Norges Bank.

Statement of changes in owner's capital

Note 1 General information

Introduction

Norges Bank is Norway’s central bank. Norges Bank is a separate legal entity and is owned by the state. Norges Bank manages the Government Pension Fund Global (GPFG) on behalf of the Ministry of Finance, in accordance with section 3, second paragraph of the Government Pension Fund Act and the management mandate for the GPFG, issued by the Ministry of Finance.

The GPFG shall support government saving to finance future expenditure and underpin long-term considerations relating to the use of Norway’s petroleum revenues. The Storting (Norwegian Parliament) has established the legal framework in the Government Pension Fund Act, and the Ministry of Finance has formal responsibility for the fund’s management. The Executive Board of Norges Bank has delegated day-to-day management of the GPFG to Norges Bank Investment Management (NBIM).

The Ministry of Finance has placed funds for investment in the GPFG in the form of a Norwegian krone deposit with Norges Bank (the krone account). Norges Bank manages the krone account in its own name by investing the funds in an investment portfolio consisting of equities, bonds, real estate and renewable energy infrastructure. The GPFG is invested in its entirety outside of Norway.

Transfers are made to and from the krone account in accordance with the management mandate. When the Norwegian State’s petroleum revenue exceeds the use of petroleum revenue in the fiscal budget, deposits will be made into the krone account. In the opposite situation, withdrawals will be made. Transfers to and from the krone account lead to a corresponding change in owner’s capital.

For further information on the management mandate for the GPFG, Norges Bank’s governance structure and risk management, see note 9 Investment risk.

Approval of the financial statements

The annual financial reporting for the GPFG is an excerpt from Norges Bank’s financial reporting and is included in Norges Bank’s annual financial statements as note 20. The annual financial statements of Norges Bank for 2025 were approved by the Executive Board on 5 February 2026 and approved by the Supervisory Council on 26 February 2026.

Note 2 Accounting policies

This note describes accounting policies, significant estimates and accounting judgements that are relevant to the financial statements as a whole. Additional accounting policies, significant estimates and accounting judgements are described in the respective statements and notes.

Basis of preparation

In accordance with the Regulation on the financial reporting of Norges Bank (the Regulation) as laid down by the Ministry of Finance, the financial reporting for the GPFG is prepared in accordance with IFRS Accounting Standards as adopted by the EU, based on the going concern assumption. The annual financial statements are prepared with a closing date of 31 December, and are presented in Norwegian kroner (NOK), rounded to the nearest million. Rounding differences may occur.

Changes in accounting policies, including new and amended standards and interpretations in the period

Accounting policies are applied consistently with those of the previous financial year. There are no new or amended IFRS standards and interpretations that have become effective for the financial year starting 1 January 2025, that have had a material impact on the financial statements.

New and amended standards and interpretations effective from 2026 or later

IFRS 18 Presentation and Disclosure in Financial Statements

In 2024, the IASB issued a new accounting standard, IFRS 18 Presentation and Disclosure in Financial Statements. IFRS 18 will replace IAS 1 Presentation of Financial Statements. The new standard applies to annual reporting periods beginning on or after 1 January 2027. The new standard introduces several new requirements for the presentation of the financial statements and note disclosures. The most relevant for the GPFG are:

• A requirement to classify all income and expenses into five categories in the income statement: operating, investing, financing, income taxes, and discontinued operations.
• A requirement to present a defined operating profit subtotal.
• A requirement to disclose items defined as Management-defined Performance Measures (MPMs) in a single note in the financial statements.

Norges Bank has started the assessment of the new requirements in IFRS 18. Recognition and measurement will remain unchanged and the implementation of IFRS 18 will therefore not have an impact on Profit/loss and total comprehensive income and Owner’s capital.

The preliminary assessment is that the GPFG is considered to be an entity that invests in assets as a main business activity under IFRS 18. Accordingly, income and expense items related to the investment portfolio will primarily be classified in the operating category in the income statement.

IFRS 18 will be implemented from the effective date, with retrospective application as required.

Other

Other issued IFRS standards, changes in existing standards and interpretations with effective dates from 2026 or later, are expected to be immaterial or not applicable for the financial reporting for the GPFG at the time of implementation.

Accounting policies for the financial statements as a whole

Financial assets and liabilities

Recognition and derecognition

Financial assets and liabilities are recognised in the balance sheet upon becoming a party to the instrument’s contractual provisions.

Financial assets are derecognised when the contractual rights to the cash flows expire, or when the financial assets and substantially all the risks and rewards of ownership are transferred. See note 13 Secured lending and borrowing for details of transferred assets that are not derecognised.

Financial liabilities are derecognised when the obligation is extinguished, i.e. when the obligation specified in the contract is discharged, cancelled or expires.

Purchase or sale of a financial asset where the contractual terms require settlement in accordance with normal market conditions, is recognised on the trade date.

Classification and measurement

Financial assets are classified based on the business model used for managing the assets and their contractual cash flow characteristics.

The investment portfolio of the GPFG is managed in accordance with the management mandate issued by the Ministry of Finance, the investment mandate issued by the Executive Board of Norges Bank and investment strategies issued by the management of Norges Bank Investment Management. These mandates and strategies, including the risk management strategies, entail that financial assets are managed and evaluated on a fair value basis. The GPFG’s financial assets are therefore measured at fair value through profit or loss, except for Management fee receivable which is not part of the investment portfolio. Management fee receivable is measured at amortised cost.

Financial liabilities, except for Management fee payable and Deferred tax, are integrated in the investment portfolio which is managed and evaluated on a fair value basis. These are therefore designated at fair value through profit or loss. Management fee payable is measured at amortised cost. See note 10 Tax for information on recognition and measurement of deferred tax.

Financial derivatives are measured at fair value through profit or loss.

Subsidiaries

The GPFG is an investment entity in accordance with IFRS 10 Consolidated financial statements. IFRS 10 defines an investment entity and introduces a mandatory exemption from consolidation for investment entities.

Investments in real estate and renewable energy infrastructure are made through subsidiaries of Norges Bank, which are exclusively established as part of the management of the fund. Subsidiaries are controlled by the GPFG and are included in the financial reporting for the GPFG in accordance with section 3-4 of the Regulation. For further information, see note 16 Interests in other entities.

Subsidiaries measured at fair value through profit or loss

Subsidiaries that invest in real estate or renewable energy infrastructure through ownership interests in other entities, are investment entities. These subsidiaries are measured at fair value through profit or loss in accordance with the principles for financial assets. Subsidiaries that invest in real estate and renewable energy infrastructure are presented in the balance sheet as Unlisted real estate and Unlisted infrastructure, respectively. See note 6 Unlisted real estate and note 7 Unlisted renewable energy infrastructure for supplementary policies.

Consolidated subsidiaries

Subsidiaries that perform investment-related services, and which are not investment entities themselves, are consolidated. Consolidated subsidiaries do not own investments in real estate or infrastructure for renewable energy, either directly or indirectly.

Note 3 Returns

Table 3.1 shows return for the fund and for each asset class.

Table 3.1 Returns

A time-weighted rate of return methodology is applied. The fair value of holdings is determined at the time of cash flows into and out of the asset classes and the fund as a whole. Geometric linking of periodic returns is used for longer return periods.

Returns are calculated net of transaction costs, non-reclaimable withholding taxes on dividends and interest, and taxes on realised capital gains.

Returns are measured both in Norwegian kroner and in the fund’s currency basket. The currency basket is weighted according to the currency composition of the benchmark index for equities and bonds. Returns measured in the fund’s currency basket are calculated as the geometric difference between the fund’s returns measured in Norwegian kroner and the return of the currency basket.

The fund’s relative return is calculated as the arithmetic difference between the fund’s return and the return of the fund’s benchmark index. The fund’s benchmark index consists of global equity and bond indices determined by the Ministry of Finance and is calculated by weighting the monthly returns of the benchmark indices for each of the two asset classes, using the weight in the actual benchmark at the beginning of the month for the respective asset class.

Note 4 Income/expense from equities, bonds and financial derivatives

Table 4.1 Specification Income/expense from equities

Table 4.2 Specification Income/expense from bonds

Table 4.3 Specification Income/expense from financial derivatives

Note 5 Holdings of equities, bonds and financial derivatives

Table 5.1 specifies the sector composition of investments in equities.

Table 5.1 Equities

At the end of 2025, accrued dividends amounted to NOK 11 115 million (NOK 12 234 million at the end of 2024).

Table 5.2 specifies investments in bonds per category. Notional value represents the amount that shall be returned at maturity, also referred to as the par value of the bond.

Table 5.2 Bonds

At the end of 2025, earned interest amounted to NOK 56 924 million (NOK 51 128 million at the end of 2024).

Financial derivatives

Financial derivatives are used to adjust the exposure in various portfolios as a cost-efficient alternative to trading in the underlying securities. Foreign exchange derivatives are also used in connection with liquidity management. Equity derivatives with an option component are often a result of corporate actions, and can be converted into equities or sold. The GPFG also uses equity swaps in combination with purchase and sale of equities.

Table 5.3 specifies financial derivatives recognised in the balance sheet. Notional amounts are the basis for calculating any cash flows and gains/losses for derivative contracts. This provides information on the extent to which different types of financial derivatives are used.

Table 5.3 Financial derivatives

¹ Notional amounts are not considered relevant for equity derivatives and are therefore not included in the table.

² Exchange-traded futures contracts have daily margin payments and the net amount recognised in the balance sheet is normally zero at the balance sheet date, with the exception of futures contracts in certain markets where there is different timing for setting the market value for recognition in the balance sheet and daily margining.

Foreign exchange derivatives

This consists of foreign exchange forward contracts, which are agreements to buy or sell a specified quantity of foreign currency on an agreed future date.

Interest rate derivatives

This consists of agreements between two parties to exchange interest payment streams based on different interest rate calculation methods. Interest rate derivatives recognised in the balance sheet are mainly interest rate swaps, where one party pays a floating rate of interest and the other pays a fixed rate.

Credit derivatives

This comprises credit default swaps indices (CDS indices) for corporate bonds, where one party (the seller) assumes the credit risk and the other party (the buyer) reduces the credit risk on the underlying index of corporate bonds. Under a CDS index contract, the seller receives a periodic coupon from the buyer as compensation for assuming the credit risk. The buyer only receives payment if the credit protection is triggered by for instance default on the underlying credit in the index (credit event).

Equity derivatives

Equity derivatives are derivatives with exposure to an underlying equity. Equity derivatives recognised in the balance sheet include instruments with an option component, such as rights and warrants. These instruments grant the owner the right to purchase an equity at an agreed price within a certain time frame.

Futures contracts

Futures contracts are listed contracts to buy or sell a specified asset (security, index, interest rate, power or similar assets) at an agreed price at a future point in time.

Equity swaps in combination with purchase or sale of equities

Equity swaps are entered into in combination with purchases or sales of equities, as part of the fund’s secured lending and borrowing activities. See note 13 Secured lending and borrowing for further information. The GPFG does not take market risk in these transactions and therefore has virtually no net exposure. The equity swaps (derivative) are not recognised in the balance sheet. At the end of 2025, equities purchased in combination with offsetting equity swaps amounted to NOK 873 billion (NOK 671 billion at the end of 2024). Equity sales in combination with offsetting equity swaps amounted to NOK 179 billion (NOK 194 billion at the end of 2024). See also table 14.1 in note 14 Collateral and offsetting.

Note 6 Unlisted real estate

Income/expense and changes in carrying amounts related to investments in unlisted real estate are specified in tables 6.1 and 6.2 below.

Table 6.1 Income/expense from unlisted real estate

¹ Earned interest and dividends which are not cash-settled are included in Unrealised gain/loss.

Table 6.2 Changes in carrying amounts unlisted real estate

Cash flows between the GPFG and subsidiaries presented as Unlisted real estate

The GPFG makes cash contributions to subsidiaries in the form of equity and long-term loan financing, to fund investments in real estate assets, primarily properties. Net income in the underlying real estate companies can be distributed back to the GPFG in the form of interest and dividend as well as repayment of equity and long-term loan financing. There are no significant restrictions on the distribution of interest and dividend from subsidiaries to the GPFG.

Net income distributed back to the GPFG in the form of interest and dividend is presented in the statement of cash flows as Receipts of interest and dividend from unlisted real estate. Cash flows in the form of equity and loan financing, as well as repayment of these, are presented in the statement of cash flows as Net cash flows to/from investments in unlisted real estate.

Net income that is not distributed back to the GPFG is reinvested in the underlying real estate companies, to finance for instance property development and repayment of external debt.

A net cash flow from the GPFG to subsidiaries will result in an increase in the value of Unlisted real estate in the balance sheet, while a net cash flow from subsidiaries to the GPFG will result in a decrease.

Table 6.3 specifies cash flows between the GPFG and subsidiaries presented as Unlisted real estate.

Table 6.3 Cash flow unlisted real estate

Underlying real estate companies

Real estate subsidiaries have investments in other non-consolidated, unlisted companies. For further information, see note 16 Interests in other entities.

Table 6.4 specifies the GPFG’s share of net income generated in the underlying real estate companies, which is the basis for Income/expense from unlisted real estate presented in table 6.1.

Table 6.4 Income from underlying real estate companies

1 Internal asset management is carried out on 100 percent owned properties by employees in a wholly-owned, consolidated subsidiary.

2 Operating costs in wholly-owned subsidiaries are measured against the upper limit from the Ministry of Finance, see note 12 for more information.

3 Unrealised gain/loss presented in table 6.1 includes net income in the underlying real estate companies which is not distributed back to the GPFG, and will therefore not correspond to Unrealised gains/loss presented in table 6.4.

Table 6.5 specifies the GPFG’s share of assets and liabilities in the underlying real estate companies, which comprises the closing balance for Unlisted real estate presented in table 6.2.

Table 6.5 Assets and liabilities underlying real estate companies

¹ Net other assets and liabilities comprise cash, tax and operational receivables and liabilities.

Note 7 Unlisted renewable energy infrastructure

Income/expense and changes in carrying amounts related to unlisted infrastructure are specified in table 7.1 and 7.2 below.

Table 7.1 Income/expense from unlisted infrastructure

¹ Earned interest and dividends which are not cash-settled are included in Unrealised gain/loss.

Table 7.2 Changes in carrying amounts unlisted infrastructure

Cash flows between the GPFG and subsidiaries presented as Unlisted infrastructure

The GPFG makes cash contributions to subsidiaries in the form of equity and long-term loan financing, to fund investments in renewable energy infrastructure. Net income in the underlying infrastructure companies can be distributed back to the GPFG in the form of interest and dividend as well as repayment of equity and long-term loan financing. There are no significant restrictions on the distribution of interest and dividend from subsidiaries to the GPFG.

Net income which is distributed back to the GPFG in the form of interest and dividend is presented in the statement of cash flows as Receipts of interest and dividend from unlisted infrastructure. Cash flows in the form of equity and loan financing, as well as repayment of these, are presented in the statement of cash flows as Net cash flows to/from investments in unlisted infrastructure.

A net cash flow from the GPFG to subsidiaries will result in an increase in the value of Unlisted infrastructure in the balance sheet, while a net cash flow from subsidiaries to the GPFG will result in a decrease.

Table 7.3 specifies cash flows between the GPFG and subsidiaries presented as Unlisted infrastructure.

Table 7.3 Cash flow unlisted infrastructure

Underlying infrastructure companies

Infrastructure subsidiaries have investments in other non-consolidated, unlisted companies. For further information, see note 16 Interests in other entities.

Table 7.4 specifies the GPFG’s share of net income generated in the underlying infrastructure companies, which is the basis for Income/expense from unlisted infrastructure presented in table 7.1.

Table 7.4 Income from underlying infrastructure companies

1 External manager fees are related to investments in unlisted funds.

2 Operating costs in wholly-owned subsidiaries are measured against the upper limit from the Ministry of Finance, see note 12 for more information.

3 Unrealised gain/loss presented in table 7.1 includes net income in the underlying infrastructure companies which is not distributed back to the GPFG, and will therefore not correspond to Unrealised gains/loss presented in table 7.4.

Table 7.5 specifies the GPFG’s share of assets and liabilities in the underlying infrastructure companies, which comprises the closing balance for Unlisted infrastructure as presented in table 7.2.

Table 7.5 Assets and liabilities underlying infrastructure companies

¹ Net other assets and liabilities comprise cash, tax and operational receivables and liabilities.

Note 8 Fair value measurement

Introduction

Fair value for the majority of assets and liabilities is based on quoted market prices or observable market inputs. If the market is not active, fair value is established using valuation techniques that maximise the use of relevant observable inputs. Estimating fair value can be complex and requires the use of judgement, particularly when observable inputs are not available. The control environment in Norges Bank Investment Management addresses valuation risk, as described in the Control environment section of this note.

The fair value hierarchy

All assets and liabilities that are part of the investment portfolio are classified in the three categories in the fair value hierarchy presented in table 8.1. The classification is determined by the observability of the market inputs used in the fair value measurement:

• Level 1 comprises assets that are valued based on unadjusted quoted prices in active markets. An active market is defined as a market in which transactions take place with sufficient frequency and volume to provide pricing information on an ongoing basis.
• Assets and liabilities classified as Level 2 are valued using models that utilise market inputs that are either directly or indirectly observable. Inputs are considered observable when they are developed based on publicly available market data reflecting actual events and transactions.
• Assets classified as Level 3 are valued using models with significant use of unobservable inputs. Inputs are considered to be unobservable when market data is not available, and the input is developed using the best available information on the assumptions that market participants would use when pricing the asset.

An overview of models and valuation techniques, with observable and unobservable inputs, categorised by instrument type, is provided in the Valuation techniques section of this note.

Table 8.1 Categorisation of the investment portfolio by level in the fair value hierarchy

1 Other (assets) consists of the balance sheet lines Deposits in banks, Secured lending, Cash collateral posted, Unsettled trades (assets), Withholding tax receivable and Other assets

2 Other (liabilities) consists of the balance sheet lines Secured borrowing, Cash collateral received, Unsettled trades (liabilities) and Other liabilities.

3 Market value investment portfolio is exclusive of Management fee payable and Deferred tax.

The majority of the total portfolio is priced based on observable market prices. At the end of 2025, 98.0 percent of the portfolio was classified as Level 1 or 2, which is a marginal decrease compared to year-end 2024. For further information, see the section Movements between levels in the fair value hierarchy in this note.

Equities

Measured as a share of total value, virtually all equities (99.76 percent) were valued based on official closing prices from stock exchanges and classified as Level 1 at the end of 2025. A small share of equities (0.23 percent) were classified as Level 2 at year-end. These are mainly equities that are valued based on derived prices. The share of equities valued with significant use of unobservable inputs and classified as Level 3 at year-end was 0.01 percent. These are equities that are not listed, or where trading has been suspended and an adjustment has been applied to the last traded price based on company- or country-specific factors.

Bonds

The majority of bonds have observable, executable market quotes in active markets and 89.72 percent of bond holdings were classified as Level 1 at the end of 2025. Bond holdings that do not have a sufficient number of observable quotes or that are priced based on comparable liquid bonds are classified as Level 2. These amounted to 10.26 percent of bond holdings at year-end. An insignificant share of bond holdings (0.02 percent) that did not have observable quotes were classified as Level 3 at year-end, since the valuation was based on significant use of unobservable inputs.

Unlisted real estate and unlisted renewable energy infrastructure

All investments in unlisted real estate and unlisted renewable energy infrastructure are classified as Level 3, since models are used to value the underlying assets and liabilities with extensive use of unobservable market inputs. Properties and direct investments in unlisted infrastructure are measured at the value determined by external valuers. Investments in unlisted infrastructure funds are measured at the fair value provided by the fund manager. Exceptions to this are recent investments where the purchase price, excluding transaction costs, is normally considered to be the best estimate of fair value, or cases where there are indications that the value determined by external valuers or fund managers does not reflect fair value, such that adjustment of valuations is justified.

Financial derivatives

Some equity derivatives (rights and warrants) and credit derivatives (CDS indices) that are actively traded, are classified as Level 1. The majority of derivatives are classified as Level 2, since the valuation of these is based on standard models using observable market inputs. Certain derivatives are valued based on models with significant use of unobservable inputs and are classified as Level 3.

Other assets and liabilities that are part of the investment portfolio are classified as Level 2.

Movements between the levels in the fair value hierarchy

Reclassifications between Level 1 and Level 2

The share of equities classified as Level 1 was virtually unchanged compared to year-end 2024. There were no significant reclassifications of equities between Level 1 and Level 2.

The share of bonds classified as Level 1 decreased by 1.1 percentage points compared to year-end 2024. There was a net reclassification from Level 1 to Level 2 of NOK 149 billion during the year. This consisted of bonds with a value of NOK 222 billion which were reclassified from Level 1 to Level 2, primarily due to reduced price observability, offset by bonds with a value of NOK 73 billion which were reclassified from Level 2 to Level 1.

Reclassifications between Level 2 and Level 3

The share of equities and bonds classified as Level 3 was virtually unchanged compared to year-end 2024. There were no significant reclassifications between Level 2 and Level 3 during the year.

Table 8.2 Changes in Level 3 holdings