Over the past few years, the Nordic high-yield market has reached what can be described as a new normal of consistently high activity. Following a brief slowdown during the pandemic and 2022 amid global volatility, issuance has remained robust — closing 2024 at around EUR 18 billion and already surpassing EUR 18.5 billion in 2025.
This stability reflects a well-functioning and resilient Nordic high-yield market. With that in mind, the German segment has shown remarkable momentum.
When Pareto entered the German market in 2018, total Nordic-style high-yield issuance volumes were minimal - barely EUR 200 million annually, with only a handful of transactions each year. But a shift occurred in 2023, and volumes rose to over EUR 600 million across seven issues. This more than doubled in 2024 to reach EUR 1.3 billion, surpassing the EUR 1 billion threshold for the first time. The momentum has continued into 2025, with nearly EUR 1.5 billion already placed through 13 transactions in the first nine months — more than twice the level seen at the same time last year.
Speaking at Pareto Securities’ Nordic High Yield Investor Day in Frankfurt this year, Zafer Rüzgar, Head of Research Germany at Pareto Securities, commented on the market’s rapid development.
Germany has emerged as one of the fastest-growing regions in the Nordic high-yield space. From just a few isolated deals a few years ago to over a billion euros in annual issuance today.
The clearest evidence of this growth is the increasing dominance of the Nordic bond format within the German SME market. In 2018, the traditional German bond format made up nearly all issuance — around EUR 1.4 billion — while Nordic-style bonds represented only a small fraction.
2023 was the tipping point: for the first time, Nordic high-yield bonds from German issuers surpassed traditional senior notes. In 2024, more than 90% of all German SME high-yield issuance was executed in the Nordic format — a trend that has continued into 2025 with approximately EUR 1.5 billion placed so far.
Zafer Rüzgar, Head of Research Germany at Pareto Securities
The Nordic format has clearly become the preferred debt financing tool for German small and mid-sized companies. It’s no longer an alternative — it’s the standard for SMEs seeking flexible and efficient access to capital.
Zafer Rüzgar, Head of Research Germany
Pareto Securities has been instrumental in driving this growth and now holds an estimated 60% market share in German Nordic high-yield transactions, far ahead of competitors — underscoring its position as the market leader in both the Nordics and Germany.
German Nordic bonds trade slightly above the wider Nordic market, mainly because of different sector exposure — less energy, more industrial exporters — but this difference has stayed stable. Returns have been strong, about 30% since early 2022, with low volatility. Default rates are still much lower than the global high-yield average — around 3% in the Nordics and even lower in Germany, where only two small defaults have occurred so far in 2025.
The convergence between Nordic and German high yield is a success story built on efficiency, transparency, and trust. As more German issuers and international investors engage with this format, we believe the market will continue to expand and evolve — with Pareto playing a central role in that development.
Zafer Rüzgar, Head of Research Germany
This year’s Nordic HY German Issuers Investor Day gathered more than 130 participants and nine issuers for a full day of presentations, panel discussions, and market insights. The event was held at the ONE building – which also houses Pareto Securities Germany’s new office – marking the firm’s growing presence in the market. The conference highlighted the strong momentum and increasing international interest in the Nordic bond format.
Learn more about Pareto Securities’ presence in Germany
