Nordic Investment Bank expands lending to weapons projects

The Nordic Investment Bank can now finance conventional defence projects, including weapons purchases and production, after widening its role for the first time in 20 years, mbl.is reports. The change reflects shifting conditions in Europe and could have particular significance for Iceland, according to the bank’s head of lending, Jeanette Vitasp.

Resilience, including security and defence, has become the bank’s third pillar alongside sustainability and competitiveness. Vitasp said the change responds to the strategic needs of the bank’s eight Nordic and Baltic member countries, but stressed that defence would not become a main focus at the expense of other work.

The policy has been revised in stages. The bank has gradually opened up defence financing, and last year it further eased restrictions to allow loans for conventional weapons and ammunition purchases, as well as weapons production. Controversial weapons remain excluded.

The expanded role also covers areas related to projects the bank has financed before, including cyber security and energy security. Vitasp said the bank can now take part in more projects that were previously barred by its exclusions, but is not becoming a specialist defence institution.

Recent defence-related financing includes a five-million-euro loan to Finnish company Savox Communications in May 2025 for research, development and capital investment, and a 400-million-euro loan to Lithuania that month for defence investments. In October 2025, Lithuania’s Valstybės investicinis kapitalas invested six million euros in a 25-million-euro defence bond to help establish artillery ammunition production in Lithuania with a joint venture involving Rheinmetall.

Other examples listed by the bank include a research and development loan of 1.2 billion Swedish kronor to Saab in December 2025; 11.4 million euros for Estonia’s Metrosert to establish a drone technology centre in February 2026; and 50 million euros for Finnish shipbuilder Rauma Marine Constructions in June 2026. The latter serves both civilian and military purposes. That month, the bank also provided 125 million euros to Swedish company Peab for operating costs related to military infrastructure in Sweden and Norway.

Vitasp was in Iceland for the Arctic Circle conference at Harpa.