Norway’s KLP Banken is eyeing a first mortgage-backed covered bond issue out of new entity KLP Boligkreditt in the coming months, after having received approval for the specialist institution from the Norwegian FSA (Finanstilsynet) last month.

Norway’s KLP Banken is setting up a mortgage covered bond issuer to lower its funding costs and generate financing to purchase retail mortgages booked with the KLP insurance company.