Monthly report June 2022 - NFF

The NAV rate in June was 103.28, which gives an increase for the month of 0.54 (0.53 %). It is a stable and good month, the fund rates according to plan. The inflow for the month of June is SEK 102 million, thank you very much for that. We have a good pipeline for factoring so all inflows will be put to work in the foreseeable future.

The market

I've inserted some of Teknikföretagen's analysis of the May inflation figure. They describe well the effect that rising energy prices have on other parts of the economy. All sectors are affected more or less directly or indirectly. One conclusion we can draw is that: everyone who suffers from these cost increases will strive to compensate for this as long as it is profitable for them to do so. We need to see a calmer demand pressure in the economy, which means that it does not pay to compensate for increased input prices. This is, among other things, what the central banks are trying to achieve through interest rate increases. Hope they succeed even though they woke up late. The image below shows how the different commodity groups contributed to inflation in the past year. Thus, as can be seen, the energy component is large and amounts to about two percentage points. Transport and food have also increased a lot. Both of these components are affected by higher energy costs, especially transportation. Food prices (and non-alcoholic beverages) were nearly nine per cent higher in May than the corresponding month last year, compared with 6.6 percent in April. Its contribution to inflation thus increased from 1.0 to 1.3 percentage points. In part, the rise in these prices are driven by rising prices for electricity and diesel. But also greatly increased costs of international shipping and packaging, a reduced supply of some foodstuffs as well as artificial fertilizers, weather phenomena and speculations in the wake of the Ukraine war has affected food prices. That Ukraine is a major exporter of for example, rapeseed, wheat and corn have also pushed up inflation.

Below you see the NFF and its return since the start in comparison with a long bond fund. You can sell a long bond fund on the day, but you hardly get an interesting return if you compare with NFF since its inception. It looks good to be able to present a curve that has given a steady and consistent return. 

(source: Bloomberg)


The provisions in this fund are very small, which is why we do not make a special table for this.

Everything is in category 1 and the fund's collateral is over 30,000 invoices that are pledged in favor of the fund. These are rolled out in 30 to 90 days with credit insurance both with and without recourse. Furthermore, there is a wealth insurance for a contingency if false invoices should appear.

We are looking forward to the opportunity for growth for factoring in 2022, our partner is getting more and more assignments and that is positive. A little smolk in the cup is that competition increases and thus pricing hardens, I think that we land closer to 6% 2022 than 7% which became the case in 2021.