Covered Bonds

Jonas Klink, who has left Santander covered bond trading in Madrid, will join Barclays.

Hamburger Sparkasse (HASPA) paid a small new issue premium for its five year Pfandbrief on Tuesday, and will be followed on Wednesday with more German covered bonds in the belly of the curve from Commerzbank and Stadtsparkasse München. Despite the ease of five year execution, some bankers believe the 10 year is also open — and could soon be supplied by a fourth German issuer.

Hamburg Sparkasse has appointed leads for a five year Pfandbrief. The mandate announcement has emerged as dealers report switching interest in Belgian covered bonds.

Bank of New Zealand is looking to issue either senior unsecured or covered bonds in euros, as it keeps its funding options open amid volatile trading conditions in European markets.

Perceived Italian political risk may have started to decline for now, but with volatility certain to return, the covered bond market is one of the safest places to be invested in. GlobalCapital interviewed a major covered bond asset manager for his view on the market in the wake of this week’s extraordinary events.

Royal Bank of Canada followed Toronto Dominion into the sterling covered bond market this week, pricing its first deal of the year at the same spread as its peer. Given a relatively high number of covered bond redemptions this year, RBC could well return.

Toronto Dominion Bank issued the only two covered bond benchmarks in what was otherwise a desolate week for the FIG sector. Despite exceptionally volatile market conditions, the euro and sterling transactions went well leading a syndicate banker to conclude that TD "owns" the covered bond market.

Toronto Dominion Bank issued the largest sterling covered bond from a non-UK bank on Thursday. The transaction, which follows the issuer's successful euro covered bond on Wednesday and comes amid a dearth of FIG issuance, demonstrates the strength of the product and TD’s name.

Toronto Dominion took advantage of a brief respite from volatility in the European government bond market to issue a €1bn seven year transaction on Wednesday.

DNB is preparing to issue its first green covered bond, the proceeds of which will be used to fund the most energy efficient residential mortgages in Norway. The prospective deal has been structured in line with the Green Bond Principles and will be endorsed by Sustainalytics.

In the face of rates volatility Toronto Dominion has decided against an intraday deal execution and has instead mandated for a covered bond that should be launched on Wednesday.

Oberbank was comfortably subscribed on Tuesday for its debut covered bond, which was priced in line with a recent French benchmark despite being only €300m in size, having a tricky 15 year tenor and arriving amid increasing volatility in credit markets.