Covered Bonds

Euromoney Conferences, The Intercontinental Hotel, Berlin

An awkward silence fell upon the opening discussion at the Euromoney/ECBC conference this morning when panellists were asked whether covered bonds, in light of the recent volatility, would have to give up their claim to be a rates product.

A surge in new issuance activity in European bond markets in the wake of the Fed’s 50bp rate cut yesterday (Tuesday) passed the covered bond market by today (Wednesday).

The secondary market was becalmed today, with syndicate managers and traders having little to report.

Analysts have cut forecasts for covered bond issuance this year amid the confusion in the market. There are widespread concerns that the liquidity crisis will have lasting implications for supply.

During the beta-test for The Cover, we asked investment bankers whether they might refer to our new league tables in their pitches to clients. The answers were refreshingly honest.

So you didn’t get an invitation to the most exclusive event in the covered bond market this year? No, not Mervyn King’s tête-à-tête with Adam Applegarth — the beta-test for The Cover.

The covered bond market’s campaign to position itself as a rates and not a credit product would do any spin doctor proud.