The fund’s fixed-income investments are allocated 70 percent to bonds issued by governments and related institutions and 30 percent to securities issued by the corporate sector.
The investments in government bonds are distributed according to the economic size of a country, as measured by its gross domestic product. Norges Bank Investment Management also considers the strength of a country’s public finances when investing in government bonds.
The majority of the investments are in developed countries, with a high percentage of government bonds denominated in euros, dollars, pounds and yen. Around 10 percent of fixed-income investments are in government bonds in currencies from emerging markets. These bonds generally have an investment grade credit rating.
The investments in corporate bonds include debt issued by companies as well as covered bonds, or debt issued by banks that are secured by a portfolio of mortgage loans. Corporate bonds normally provide a higher return than government bonds.
All corporate bond investments are made after a credit assessment, either external or internal. Holdings in non-investment grade bonds are targeted to not exceed 5 percent of the overall fixed-income portfolio.
Holdings in fixed-income markets
Percentage of market value of bonds in the benchmark index
Source: Bloomberg Barclays Indices, Norges Bank Investment Management
The fund's largest bond holdings
As at 31 December 2018. Millions of kroner
|IssuerUnited States of America||CountryUS||Holding 638,715|
|IssuerJapanese government||CountryJapan||Holding 237,179|
|IssuerFederal Republic of Germany||CountryGermany||Holding 106,116|
|IssuerUK government||CountryUK||Holding 64,844|
|IssuerFrench Republic||CountryFrance||Holding 47,998|
|IssuerSouth Korean government||CountrySouth Korea||Holding 43,366|
|IssuerMexican government||CountryMexico||Holding 42,594|
|IssuerSpanish government||CountrySpain||Holding 41,388|
|IssuerItalian Republic||CountryItaly||Holding 36,517|
|IssuerAustralian government||CountryAustralia||Holding 36,399|
|IssuerCanada Mortgage & Housing Corp||CountryCanada||Holding 31,785|
|IssuerKreditanstalt für Wiederaufbau||CountryGermany||Holding 27,475|
|IssuerGovernment of Indonesia||CountryIndonesia||Holding 25,114|
|IssuerBrazilian government||CountryBrazil||Holding 23,284|
|IssuerGovernment of South Africa||CountrySouth Africa||Holding 21,139|
|IssuerEuropean Investment Bank||CountryInternational organisation||Holding 19,530|
|IssuerGovernment of Switzerland||CountrySwitzerland||Holding 18,757|
|IssuerGovernment of Canada||CountryCanada||Holding 18,275|
|IssuerIndian government||CountryIndia||Holding 17,007|
|IssuerGovernment of Malaysia||CountryMalaysia||Holding 16,958|
The fund's total holdings are published annually with the annual reporting on the fund. The annual holdings as at 31 December are available from inception in 1998.