Covered Bonds

Bank of Åland Covered Bonds

Bank of Åland grants long term loans to Finnish and Swedish households, housing companies and corporates. Loans are used as collateral in the two cover pools in Bank of Åland, Cover Pool FIN and Cover Pool SWE. All loans in the Bank of Åland cover pools are secured by Finnish and Swedish mortgages and tenant-owner units. Bank of Åland is licensed by the Finnish Financial Supervisory Authority to issue covered bonds according to the Finnish Covered Bond Act.

Ålandsbanken is committed to an overcollateralization clearly over the legislative minimum of 2 %. Overcollateralization is kept on a level that allows the maximum uplift of 4 notches in S&P rating framework^* or an AAA rating on the covered bonds.

Bank of Åland is committed to maintain a liquidity buffer covering 180 days of contractual outflows from the covered bonds issued. The liquidity buffer consists of contractual inflows and liquid assets in the cover pool.

*Standard&Poors: Covered Bonds Criteria 9.12.2014