The Ministry of Finance has today offered banks the possibility of swapping covered bonds for government securities (see separate press release from The Ministry of Finance). The two-year loans offered by Norges Bank will complement these swap agreements and are particularly designed to secure funding for small banks.

 - The overall effect of these measures will be to make it considerably easier for banks to fund their activities, says Governor Svein Gjedrem.
 
F-loans are fixed-rate loans offered on market terms. They are extended to banks operating in Norway and are provided against collateral in the form of securities.

The maximum bid for a two-year loan will be NOK 1 billion. At the same time, collateral requirements for banks’ loans in Norges Bank will be lowered by removing the requirement of a minimum volume outstanding of NOK 300 million for securities issued in NOK.

More details and times of auctions and loans will be published on Norges Bank’s website shortly.