A mortgage credit institution may raise loans by issuing covered bonds where the mortgage credit institution’s mission as laid down in its articles of association is:
a) to grant or acquire residential mortgages, commercial mortgages, loans secured on other registered assets or public sector loans, and
b) to finance its lending business primarily by issuing covered bonds.The mortgage credit institution shall notify Kredittilsynet not later than 30 days prior to the first time it issues covered bonds.
Where consideration for a mortgage credit institution’s financial strength so indicates, SFA may instruct the mortgage credit institution not to issue covered bonds.
SFA may consent to mortgage credit institutions engaging – in a transitional period and in parallel with other activity – in activity that consists in raising loans through the issuance of covered bonds. The said activities shall in such case be kept separate from one another. SFA may impose conditions to ensure such separation. SFA’s consent may be given for a period of up to one year with the possibility of extension for one further year.