Covered Bonds

AIB Mortgage Bank was said to be struggling to build a book for its three year mortgage backed jumbo covered bond this (Monday) morning at guidance of 10bp over mid-swaps as the heavy pipeline appeared to have finally broken the primary market’s back, with covered bond investors finding plenty of reasons not to buy. Abbey is said to have postponed its planned issue in light of the torrid conditions.

Bank of Montreal will early next year become the second Canadian covered bond issuer after Royal Bank of Canada, having today (Monday) announced that it has mandated Bank of Montreal Capital Markets, HSBC, Morgan Stanley, Société Générale and UniCredit for its inaugural covered bond.

From the giddy heights of İşbank’s HQ to the Whitehall corridors of power: the crisis keeps the headhunters busy and Deutsche proves the old gem: if it ain’t hurtin’, it ain’t workin’.

Ahorro Corporación Financiera has decided to postpone any new AyT Cédulas Cajas issue, having last week mandated five banks to sound out investor sentiment towards a potential Eu1bn-Eu1.5bn three to five year deal.

Nordea Hypotek priced its Eu1.25bn three year Swedish covered bond at 2bp over mid-swaps this (Friday) morning, after leads Barclays, Natixis, Nordea and UniCredit closed books with just over Eu2bn of orders yesterday. The level of demand was seen by the issuer as supportive of its diversification strategy.

AIB Mortgage Bank joined the long pipeline this morning and, although AyT Cédulas Cajas has been postponed, the pace of supply shows no sign of letting up, despite the renewed fears in the credit market and order books being increasingly only minimally oversubscribed.

Dexia Municipal Agency’s Eu1.5bn three year obligations foncières issue was priced yesterday (Wednesday) at 3bp through mid-swaps after the swiftly executed deal attracted more than Eu2.2bn of demand by 2pm CET. Market participants said yesterday that the French issuers’ ability to execute quickly was thanks to the attractive pricing level versus recent German and other French supply.

Demand for Nordea Hypotek’s three year new issue had reached Eu1.5bn by midday today (Thursday) after Barclays Capital, Natixis, Nordea and UniCredit opened books with guidance of the 2bp over mid-swaps area this morning. But the level of demand and the price that Nordea paid has led some market participants to ask why the issuer is visiting the euro market.