The Investment

Invest in Swedish Prime Residential Mortgages through our Alternative Investment Funds

Hypoteket Funds have established a series of Mortgage Funds. The first fund was launched in the beginning of 2018, quickly fully committed and closed about a year later. Hypoteket Funds' second Mortgage Fund launched in the beginning of 2019 and is currently open for commitments. The funds are Alternative Investment Funds (AIFs) and regulated under the AIF act, under the supervision of Finansinspektionen (the Swedish FSA).

Hypoteket Mortgage Fund 2 (BLF II)

Hypoteket Mortgage Fund 2 is open for commitments from institutional investors. The fund targets low LTV mortgages (<65%) which makes it favorable for SII and IORP II investors.

Hypoteket Mortgage Fund 3 (HM3)

Hypoteket Mortgage Fund 3 was launched in late 2021 and is open for new investors. It is listed (Lux) and rated (Baa2, Moody's). The fund can invest in mortgages with somewhat higher LTVs (max <75%, average <60%).

Please reach out for more information about investment opportunities in the above mortgage funds!

Historical Return

The yield in the fund is pegged to the market rates of the largest Swedish mortgage providers (read more under "OMR"). Hence, overall returns will reflect the current Swedish mortgage rate landscape. As the chart on the right hand side illustrates, the running yield bottomed at the end of 2021 and has climbed gradually since (and is expected to continue to do so with short end mortgages rates widely expected to move higher).

Historical return is no guarantee for similar returns in the future. Returns will depend on, among other things, movements in market rates and potential defaults during the investment period.

The fund's strict investment policy only allows investing in prime residential mortgages originated through Hypoteket Mortgages highly digital origination process

<65/75%

Maximum loan-to-value of the mortgages in the funds

6X

Maximum debt-to-income ratio of the borrowers, including all the borrower's debt regardless of creditor

6.5%

Borrower's must be able to withstand higher interest level, up to ~ 5 times higher than the current interest rates.

Full look-through reporting

Reporting to investors is transparent and can be made on a loan-by-loan basis. This way, the investment is subject to better capital coverage ratios under the Solvency II regulatory framework as well as under the Swedish implementation of the IORP II directive.

Reporting routines is setup up with each investor and is highly adjustable to meet individual needs.