Covered Bonds
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Tight overall covered bond spreads mean that new issue premiums appear elevated, despite lower levels -
◆ Size and execution the main attractions of dollars, but it costs more ◆ Well progressed UK banks weigh taking a chip off the table ◆ Dollar covered bonds unlikely
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Banks cannot rely on deposit growth
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Covered bonds will be integral and volumes may exceed expectations
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Scarce issuance gives positive feel to market despite rates uncertainty
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Problem resurfaces despite EU Covered Bond Directive’s attempt to resolve it
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◆ Non-deal roadshows planned for the coming weeks ◆ Issuers tipped to wait despite supportive market ◆ Dearth of supply to support spreads
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Sellers will compete for buyers’ attention as they fall prey to a confluence of factors
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Lending is down but deposits are falling faster says S&P
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Taps have provided as much funding as a benchmark for some banks
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Analysts expect a widening but investors see limited scope
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Capital markets is a human relationships business. The people that forge these ties need time to recharge and rebuild, or they risk mistakes after a turbo-charged half year
