Companies are becoming increasingly aware of international opportunities in terms of capital structure and investor reach. Leading legal adviser Gorrissen Federspiel regularly deals with the technical and legal complexities in the growing field of cross-border issuance.

Capital markets are increasingly international in nature. Initiatives in Europe such as the CSD (Central Security Depository) Regulation and the Shareholder Rights Directive support a common international marketplace, but company law and securities regulation are still primarily subject to national legislation. The capital markets practice at Danish law firm Gorrissen Federspiel sees increasing internationalisation of its business, and with that comes greater complexity. Customary equity issuance by a Danish company under Danish law on the Danish stock exchange is a structured process whereby the dialogue with the CSD is limited, since the technical infrastructure is already known to the participants. In contrast, cross-border issuance has a number of more complex technical and legal aspects which make closer partnership with CSDs highly relevant.

Cross-border issuance on the rise

“We now have more Danish companies considering listing abroad, and foreign companies looking at Denmark as a listing venue, than ever before. The number of cases is still limited, but there are always one or two ongoing client projects that involve cross-border issuance and international set-ups,” says Rikke Schiøtt Petersen. She is head of the capital markets practice and partner at Gorrissen Federspiel, where she primarily deals with securities law, M&A, corporate law and corporate governance.



“In terms of cross-border issuance, we have a very good working relationship with VP Securities. They are a strong and knowledgeable partner when it comes to more complicated set-ups. This involves more than getting the technical connection from CSD to CSD right. I appreciate our informal discussion of both legal and technical issues, so that we can advise our clients on the best possible solution,” she says.



VP Securities has been part of solutions for both bonds and shares in cross-border set-ups crossing the Danish border in both directions. The philosophy is that the financial infrastructure should support the capital market and help companies to attract a transparent and effective flow of capital. As all securities are dematerialised, this is primarily a technological set-up, with a set of building blocks to be assembled according to the legal differences involved in cross-border securities trading.

Communication is key



The capital market practice at Gorrissen Federspiel is a well-reputed leading player in the Danish market and holds a strong record for demonstrated excellence. For decades, Gorrissen Federspiel has been a top securities practice representing issuers, underwriters and other market participants, as well as investors and management. In assisting Danish and foreign industrial and financial clients, Rikke Schiøtt Petersen appreciates the communication aspects of international set-ups, since international advisory teams, with banks, law firms and CSDs, need an understanding of Danish law and securities infrastructure.

At Gorrissen, we frequently invite VP to take part in the early stages, to give an in-depth explanation of the specific aspects of the Danish model. In many cases, it has proved valuable for international partners and counterparties to learn about this directly from the CSD. When we have the business and the CSD proactively engaged at the table, the process will be faster and leaner

Rikke Schiøtt Petersen, Partner at Gorrissen Federspiel

Deep knowledge

Rikke Schiøtt Petersen has been a partner at Gorrissen Federspiel since 2006, and she has seen a wide variety of cross-border issuances involving both Danish and foreign companies, and including investor reach in many markets. Different national standards, different legislation and different technical capabilities can make cross-border issuance complex, and advice on the best way to achieve the client’s objectives may call for deep knowledge and a degree of creativity. VP has been a strong partner in cutting through the complexity, and for Gorrissen Federspiel this is all about helping clients to achieve their goals in the most cost-efficient way.

We’re happy to assist legal experts like Gorrissen Federspiel in the early stages of the process. Even though the technical set-up is mostly viewed as an operational implementation of the business goal in a cross-border project, infrastructure can still be the factor determining whether a project is viable or not. By bringing infrastructure to the table at an early stage, top advisers can add value and even find a way that may have been hidden by the technical and legal complexities associated with cross-border issuance.

Flemming Merring, Head of Issuer Services at VP

Gorrissen Federspiel has represented many leading underwriters and many Danish issuers and, during the past decade, the law firm has also been involved in significant equity and debt offerings and larger IPOs.

Solar’s investor relations are becoming more and more digitised, just like the entire business. A longstanding relationship with VP is an integrated element of a cost effective and innovative approach to IR.

“More than half of our business is now related to our webshop, and it is natural for our investor relations to have the same trend. We’ve gone online with our annual reports, which is a good business case. We have also introduced partly electronic AGMs, with streaming for online participants. VP has been with us on this journey, and the team at VP INVESTOR SERVICES is a dedicated partner that challenges us, just as we challenge them,” says Charlotte Risskov Kræfting, Director, Stakeholder Relations at Solar A/S.

Solar Group is a leading European sourcing and services company, operating primarily within electrical, heating and plumbing, and ventilation technologies. The core business is product sourcing, value-adding services and optimisation of the customers’ business. Annual revenue is well beyond DKK 11 billion, and Solar employs around 3,000 employees. Solar is listed on Nasdaq Copenhagen with the short designation SOLAR B and has been listed since 1953. The stock is included in the MidCap+ index.

Longstanding partner

“I’ve been with the company for eight years and during this time our business and also investor relations have undergone some fundamental changes. VP INVESTOR SERVICES has been a partner all the way, and we benefit from a wide range of products and services, including shareholder register, insider management, IR Management - a CRM system with investors, annual general meeting, investor portal and election of employee representatives to the Board of Directors. The core is, of course, all the data related to shares and owners, and VP has skilfully built a range of good services on top of that,” says Charlotte Risskov Kræfting.

The digital element is increasingly part of many aspects of managing investor relations. With its around 3,600 shareholders, Solar is big enough to achieve tangible benefits from digitising IR. When Solar went from printed to online annual reports, and when management of access and voting rights at the AGM all went digital, using VP INVESTOR SERVICES, Solar became more efficient and saved costs related to IR.

Digital and trusted adviser

“The great benefit from partnering with VP is that they come up with digital solutions to a range of generic problems for listed companies. The insider rules in MAR are a perfect example, since we rely on VP to have all the legal and formal requirements top of mind in their design of vp.INSIDER. I expect VP to be alert and to provide solutions in response to new legislation, such as the forthcoming GDPR Regulation, and this is a huge advantage for us,” says Charlotte Risskov Kræfting, who heads a three-person team handling all of Solar’s Communication and Investor Relations.

The relationship between Solar and VP INVESTOR SERVICES goes two ways, since Solar may challenge the team at VP, or VP’s professionals may come up with new ideas as proposals to Solar. The peak season for the partnership is the AGM, where the team from VP runs a range of services and is present at the meeting to handle the identification of shareholders, admission control, voting processes and much more. The basic material is the data from the shareholder register, which is accessible via the investor portal. A relatively new feature for Solar is the partly digital AGM with streaming to shareholders.

“Not all shareholders are happy about the digitisation, but looking beyond Denmark, we can see that this is an overall trend, and for Solar this reflects how our business is becoming more digital. We want to keep following this trend, and VP INVESTOR SERVICES is a good partner to have on our side. The team at VP is also down to earth at the operational level and a knowledgeable and experienced adviser,” says Charlotte Risskov Kræfting.

Fighting for attention

Running an investor roadshow with the CFO and CEO of the company, and fighting for attention for the Solar brand, Charlotte Risskov Kræfting shares a challenge with other MidCap companies. It is increasingly harder to get analyst and media attention, since banks are devoting fewer resources to analysing the stock of medium-sized companies. Today, fewer analysts are very knowledgeable about Solar than some years ago. Solar is therefore turning to social media to boost awareness of the brand. Becoming more efficient in the “back office” of investor relations is freeing up time and attention to work more on the outside, to attract interest in the Solar stock.

Danske Bank issues structured bonds in both EUR and DKK at VP Securities. This gives operational benefits, while also enhancing customer satisfaction. 

“There’s no difference between EUR and DKK in our routines. It’s business as usual. Of course, this gives extra volume, but since it all runs smoothly we haven’t experienced any additional workload,” says Head of Settlements Sanne Robdrup, who heads a team of six settlement officers of the VP system at Danske Bank’s Customer Service Delivery. By moving the issuance of structured bonds from another CSD to VP, the external price per issuance went from a lower European to a higher Nordic level for the issuer side, but the total cost of issuance for Danske Bank went down, as a consequence of operational simplicity. The move was initiated by customer feedback, explains Morten Juhl Lilleøre, Global Head of Securities Services at Danske Bank:

We had customers complaining about deferred coupon payments, and we didn’t succeed in solving this problem with our former provider. This is especially troublesome when investors are asset managers, since their liquidity is squeezed as a consequence of delayed payments. Now, we have resolved the entire issue by moving to VP for selected currencies, and we get the benefit of one single harmonised process for structured products.

says Morten Lilleøre.

No more customer complaints

“The key advantage for Danske Bank is that we no longer get any customer complaints. The business case is strong and also simple, due to a smooth operational process. Previously, issuance was handled by up to five departments at Danske Bank, while now it has been boiled down to two departments, giving a shorter time to market and a more automated and transparent process,” he explains.

Overall, Danske Bank is looking to streamline and simplify its operational processes, and cross-border issuance is a good example of this. Looking at the bigger picture, the cost of issuance is reduced. The reduction is achieved because VP and other Nordic CSDs have a somewhat different pricing model, splitting the cost between issuer and investor, and with VP all prices are fully transparent.

Simplicity in the process

When working with an iCSD, Danske Bank previously had the complete value chain involved in the process. Now, this process has been simplified and only involves two departments along the value chain.

“Our hypothesis was that we could handle the issuance of structured products in the VP flow with little manual intervention, which is also how it turned out. The volumes and the level of automation with VP, as well as the close integration between CSD and bank, are the key to these operational benefits,” says Morten Lilleøre.

One example of the handling benefits is the interest rate fixing. This is automated at VP, while it is semi-manual at other CSDs. The benefits of centralized issuance will increase over time, with introducing a higher number of products, more diverse and complex products, and more instruments with quarterly resetting of interest rates.

Real time issuance

“It’s important to have VP’s commitment to developing and supporting cross-border issuance through technology enhancements,” says Morten Lilleøre. “Including other instruments in the same flow would only increase the operational gains on our side. In theory, going from four operational set-ups with four different CSDs to one set-up with one CSD would reduce operations by 75 per cent. This would definitely support our long-term need to simplify post-trade operations.”

The issuance process at VP is already streamlined and one aspect is a reduction of the time spent from a number of days to a matter of hours. Danske Bank wants to automate even more and have the systems talking directly to VP, explains Morten Lilleøre:

”Our aim is to create seamless integration from our systems into VP Securities by using API technologies, thereby creating close to real-time issuance of structured bonds.”

The key aspect for Danske Bank is the ability to meet customer demands, and there is a clear trend for issuance to become significantly more tailored to customer needs. Issued amounts are declining, and the number of transactions is increasing. Rapid issuance and more automated processes support Danske Bank in this market, and cross-border issuance fits into this picture, since it makes it possible to use one Nordic CSD and to have the same process for issuance in DKK, EUR, SEK and, hopefully, also NOK in the future.

“This view goes hand in hand with our vision on full automated issuance and due to great input from our customers we have already taken the first steps in this direction – and more will come”.

Bjørn Crepaz, Head of Issuer Products at VP Securities comments

For more information

Contact Senior Relationship Manager Anne Brændstrup or Customers & Communications Director Henrik Ohlsen.

Customer needs and internal efficiency gains will give cross-border issuance a strong future, predicts Global Head of Investment Solutions FICC Heikki Ruoppa from Danske Bank.

Customer needs and internal efficiency gains will give cross-border issuance a strong future, predicts Global Head of Investment Solutions FICC Heikki Ruoppa from Danske Bank. In 2017, Danske Bank issued in EUR several times in Denmark in order to reach retail investors outside Denmark, and the bank is now a firm believer in cross-border issuance.

Since 2017, Danske Bank has issued all structured products in EUR towards customers at one CSD, VP SECURITIES. Instead of local CSDs in each market, Danske Bank is now turning to its usual CSD partner in Denmark and undertaking cross-border issuance in the very same set-up as for issuance in DKK. Heikki Ruoppa is in charge of structured products at Danske Bank and leads three teams in Copenhagen, Stockholm and Helsinki, respectively. In this interview, he outlines the drivers and perspectives regarding cross-border issuance.

Q: What do you see as the key drivers, when it comes to cross-border issuance?

Heikki: There is a clear trend for issuance to become significantly more tailormade compared to earlier. We are adapting products more to customer needs, and our customers want to be able to choose. There is also a trend for issued amounts to decrease, and while the total issued amount is quite unchanged, the number of transactions is increasing. To be cost efficient while meeting these customer needs, we need to be faster, and have greater automation and more simplified processes. Cross border issuance fits nicely into this picture, as it allows us to use the same CSD and the same process for issuance in DKK, EUR and SEK, and hopefully also NOK in the future. I think this trend for growth in the number of issuances and their decreasing size will continue in the future. To me, it is evident that cross-border issuance will be a key benefit for us and for the market, as it will pave the way for automation and simplified processes.

Q: Is it fair to connect cross-border issuance with harmonisation on a greater scale?

Heikki: Definitely. Harmonisation in the Nordics will happen, and as a Nordic bank we are obviously looking for ways to streamline our offerings and operations. If we are able to handle all currencies in one and the same process, we will become faster and more responsive to customer needs, while at the same time increasing cost efficiency. Of course, we also need to have the same advice for our customers on, for example, buying or selling positions in Mærsk, regardless of whether the advisory team is located in Helsinki or Copenhagen.

Harmonisation, standardisation and regulation have come to stay, and will not go away. By streamlining issuance in all relevant currencies into one process, we are also making life easier in terms of compliance with MiFID and adaptation to T2S.

“Our rough calculations tell us that we will be able to save 70-75 per cent of the costs compared to having four different operations running in four different ways in Denmark, Norway, Sweden and Finland. But the key concern here is for us to give the customers the benefit of speed and low risk,” says Global Head of Investment Solutions FICC Heikki Ruoppa from Danske Bank in a comment on the role as first mover in cross-border issuance.

Q: You are among the first movers for cross-border issuance. Did you encounter any barriers?

Heikki: I think there is a lot of tradition in the way we think about issuance, and we will have to leave that behind. For example, we met some anxiety as to whether Swedish and Finnish investors would react negatively to Danish ISINs, and this proved to be just old habit talking. What did the customers say? Nothing. The customers buy in if the product is right and positioned right, and the ISIN is not relevant. We are selling the product, not the ISIN. In the long run, these mental barriers will disappear, and I expect more banks to start using cross-border issuance. This will eventually also be a long-term advantage for Danske Bank, as it will support standardisation and a centralised system approach, and we will need that in order to stay competitive on a global scale.

Q: What are the central business benefits from cross-border issuance for Danske Bank?

Heikki: Having one process for issuance in all currencies in central bank money is a strong position if you want to speed up a placement process. Ten years ago, the processing time was around ten days. For some of the other local Nordic markets it is around five days, and with VP we have brought it down to two hours. Is this good enough, you can ask, and no, I know that in the near future we expect to be able to issue instantly and in a fully automated process with VP SECURITIES. The key for us is the ability to meet the customers’ demands and to serve our customers.

Our rough calculations tell us that we will be able to harvest direct cost savings of 70-75 per cent. The biggest cost saver, however, concerns our internal processing, and in future we will be able to reduce the number of processes from four to only one – and that really makes a difference!

Q: How do you see this developing in the years to come?

Heikki: At Danske Bank we set high standards and it’s my belief that the same applies to VP SECURITIES. They are the ones who are challenging and seeking to change the existing Nordic market infrastructures, for the benefit of our customers. It’s therefore my hope that our colleagues from the other Nordic banks will also be able to support this development. If that happens, my prediction is that VP SECURITES would also be able to support issuances in USD, GBP and JPY.

For more information:

Contact Senior Relationship Manager Henrik Høj or Customer & Relations Director Henrik Ohlsen.

Euronext is proud to announce that IPOready will now be Euronext’s unique pan-European business educational pre-IPO programme. IPOready aims to support European companies considering a listing on Euronext in the coming years. IPOready will combine and replace Euronext’s successful legacy TechShare, GoPublic, IPOready, and FamilyShare programmes into one single comprehensive pre-IPO programme for businesses ready to take the next step towards financing their growth journey.

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