Covered Bonds

◆ EU regs plan sparks debate over treatment of secured borrowing ◆ Blistering corporate and FIG issuance but why are premiums rising in one market but not the other? ◆ UK Renters' Rights Act to impact UK buy-to-let RMBS market

Funding across all parts of the capital structure is available with issuers likely to prioritise unsecured borrowing

◆ Issuer lands in 'the place to be' amid strong demand for covereds ◆ Achieves its largest covered book since at least 2023 ◆ After 7bp tightening the bond was spotted another 2bp tighter to erase new issue concession

Market participants have questioned if the differential in the risk-weightings between securitized and covered assets will affect demand for covered bonds

The fears of the covered bond market reflect a lack of conviction in the superiority of the product

The European Covered Bond Council plans to submit its report on the proposed reforms to the European Commission

Dollar and euro flow picks up in private placements

◆ Several market currents support new long five years ◆ UniCredit GmbH achieves larger size close to fair value ◆ CRH pushes annual covered funding to €3.15bn

◆ British issuer tightens both tranches 6bp ◆ Spreads in line with comparables ◆ Lloyd’s first covered since its sterling deal in March

International borrowers dominate this week's flow in the currency

With masses to fund and spreads super-tight, banks will race to market, but central banks are expected to tighten

Market participants gathering in Stavanger will focus on market growth