The statistics Securities by ISIN codes include a variable on ownership concentration. Ownership concentration is measured by means of maximum ownership share that is computed as the share of the security owned by the biggest investor in the security. Ownership concentration is only computed for bonds and the statistics are revised with new information back to January 2005. Ownership concentration has the following possible outcomes:

1 – Series with low concentration. Maximum ownership share < 20 per cent.
2 – Series with medium concentration. 20 per cent <= maximum ownership share < 50 per cent
3 – Series with high concentration. Maximum ownership share >= 50 per cent
0 – The total amount of the bond series is owned by the issuer
L – Ownership concentration is not computed
M – Ownership concentration is not available

Information about the importance of ownership concentration for the pricing of Danish mortgage bonds can be found in Danmarks Nationalbank's publication Monetary Review, 4th quarter 2008.  

Contacts:

• Asger Munch Grønlund
   Tel. +45 33 63 68 12
• Thomas Munkebo Steffensen
   Tel. +45 33 63 68 06

In order to ensure that the identities of individual investors remain confidential the publication of the owner-distribution structure for individual securities at a given level of sub-division is kept strictly confidential, based on a quantity principle and a dominance principle. A more detailed description of the method of handling this confidentiality can be found in section 1.2.

The statistics go back to January 2005.

0.5 Users and Application
Generally, the statistics are interesting for persons/organisations with an interest in the securities area. Among other things the statistics make it possible to follow the development in the owner distribution by sector and industry of the individual security.

• ISIN
• Valuation (market value, nominal value)
• Issuer sector
• Investor sector
• Paper type
• Currency
• For bonds also coupon and maturity.

More details on the methodologies are found below.

The stock is valued according to the following principles:

The stock is compiled at market price as of month-end (closing price from Nasdaq OMX Copenhagen). In the absence of a month-end price the following applies:

• quoted bonds: the last registered price, prices from other sources or price 100.
• quoted shares: the last registered market price or prices calculated/obtained from other sources
• investment fund shares: net book value as of month-end or prices from other sources.

All stock in currency is converted to Danish kroner at the exchange rates as of month-end, while transactions are converted at the average exchange rates for a month.

• Non-financial corporations (S.11): Consist of institutional units whose distributional and financial transactions are separated from those of their owners. This means that e.g. sole proprietorships are not included in the sector. The principal activity of the units is the production of goods and non-financial services.
• MFIs (S.121-2): Consist of corporations which are principally engaged in financial intermediation and whose business is to receive deposits and/or close substitutes from the general public and other institutional units than the sector as such and to divert these in the form of loans and/or investments in securities for own account. The sector comprises banks, mortgage banks, other credit institutions, money-market funds and Danmarks Nationalbank. On the issuer side the sector is subdivided into banks, mortgage banks and other credit institutions.
• Other financial intermediaries, etc. (S.123-4): Consist of financial intermediaries that do not fit into the other financial sectors. The sector comprises investment funds, financial holding companies, the public LD Pensions and the Special Pension Savings scheme (SP). It also includes investment trusts, venture and leasing companies as well as companies providing consumer credit (e.g. via charge cards). Furthermore the sector includes financial auxiliaries which i. a. comprises Nasdaq OMX Copenhagen, VP, stockbrokers and insurance brokers and Nets.
• Insurance corporations and pension funds (S.125): Consist of all insurance corporations and pension funds whose principal function is to act as financial intermediaries by pooling risks, excluding LD Pensions and SP. Examples of units in the sector are non-life insurance corporations, life insurance corporations, pension funds and ATP (The Danish Labour Market Supplementary Pension).
• General government (S.13): Consist of authorities and institutions whose principal function is to supply non-market public services to the general public and/or to redistribute income and wealth. Non-market services are defined as services actively controlled by public authorities and supplied free of charge or at economically not significant prices.
• Households, etc. (S.14-5): Consist of two sectors. The household sector (S.14) comprises consumers and sole proprietorships where the business activity is not segregated into independent legal entities. Non-profit institutions serving households (S.15) comprises non-profit entities supplying goods and services to households (e.g. trade unions and charities).

• Rest of the world (S.2): Securities are in principle regarded as owned/issued by non-residents if the fiscal status of the owner of an account or the issuer of a paper is that of a non-resident.

Level 1 shows a holder distribution between Denmark and abroad.

Level 2 shows a domestic sector distribution on 6 sectors: non-financial corporations, MFIs and other financial intermediaries, insurance corporations and pension funds, general government, households, etc., and unallocated domestic.

Level 3 shows further distribution by sector (a total of 8 sub-sectors) of non-financial corporations (publicly- and privately-owned), general government (central government, local government and social security funds) and households, etc. (self-employed individuals, private individuals and non-profit institutions servicing households).

Level 4 is a distribution of the financial sector (MFIs and other financial intermediaries and insurance corporations and pension funds) into 12 groups.

OWNER DISTRIBUTION STRUCTURE

Adjustment of owner sector and industry distribution
The ownership distribution in the statistics applies the principles in the national accounts regarding repurchase transactions and holdings held in safe custody accounts abroad, and therefore Danmarks Nationalbank adjusts the ownership distribution of securities from VP.

Repurchase agreements and securities lending are considered as lending transactions and thus should not affect the securities' ownership distribution. However, the paper is moved from the seller's/lender's VP account to the buyer's/borrower's account as the legal ownership of the paper is transferred temporarily to the buyer/borrower. Therefore, data from VP is adjusted for repurchase transactions, securities lending and other transactions which similarly distort the ownership distribution.

The purpose of buying/borrowing securities in repurchase agreements/securities lending will often be to resell the paper in the market. When the buyer has resold the paper the repurchase adjustment can result in the fact that the buyer's holding in the respective paper becomes negative. This is quite in accordance with the accounting practice for repurchase agreements and resale. Consequently, on Danmarks Nationalbank's publication of ownership distribution negative holdings for one or more sectors may appear.

Adjustments are made for transactions between the MFI sector (the banks) and non-residents, between non-MFIs and non-residents as well as between resident sectors.

In principle a paper owned by a resident will be registered as owned by a non-resident, if it has been registered in a safe custody account abroad, e.g. Euroclear. The non-resident ownership will therefore in principle be overvalued without any corrections.

Therefore Danmarks Nationalbank collects information from Danish banks and large non-financial companies and pension funds via their reporting on holdings of securities held in safe custody accounts abroad.

In order to protect the identity of investors the owner-distribution structure of the statistics (levels 2, 3 and 4) is subject to the following confidentiality requirements:

For investors in all sectors of sector distribution 3, as well as for investors of shares and holders of investment fund shares in all sectors of sector distributions 2 and 4, the following confidentiality requirements apply:

• Quantity principle: stock data for a given investor sector must comprise the holdings of at least three investors.
• Dominance principle: a given investor's holdings may not constitute more than 90 per cent of the sector's total holding.

For all sectors of sector distributions 2 and 4 apply that the three largest bond investors may not hold more than 90 per cent of the sector's total Danish bond investments. Thus, the confidentiality criterion which allows data to be published at minimum three investors and no investor over 90 per cent has been eased from applying to any combination of ISIN code and sector (for the given sector distribution) to solely applying to the individual ISIN code seen as one.

Consequently the following confidentiality requirements apply for bond investors in all sectors of sector distributions 2 and 4:

• Quantity principle: stock data for a given ISIN code must comprise the holdings of at least three investors.
• Dominance principle: a given investor's holdings may not constitute more than 90 per cent of the total issue of a given ISIN code.

Danmarks Nationalbank applies a stringent interpretation of the above confidentiality principles by requiring compliance with the quantity principle and the dominance principle for all table cells in a given sector distribution (levels 2, 3 and 4) at any time.

Breach of one or both confidentiality principles in one or more table cells in a given sector distribution at a given time entails that no statistics are published for the given distribution at the given time. This implies that the availability of data in the individual levels of sub-division for a given paper can fluctuate over time.

The bonds are quoted on Nasdaq OMX Copenhagen. Bonds which become quoted bonds are included in the statistics at the end of the month in which they become quoted. Quoted bonds are removed from the statistics at the end of the month in which they are unquoted.

Investment fund shares comprise solely share-issuing investment funds. The statistics therefore do not correspond to Danmarks Nationalbank's statistics Investment funds, which also comprise account-holding funds that do not issue investment fund shares. Reference is made to these statistics for further information and data on investment funds.

• Analyses of developments in owner distribution by paper.

• Analyses of the portfolio of certain sectors or industries.