Covered Bonds

The Mortgage Society of Finland's deal on Tuesday was not among them however, coming as it did with a a wider spread than usual.

Kommunalkredit, which recently had its public sector covered bonds rated A with S&P, has received positive investor feedback whilst marketing its social covered bond this week.

Aegon Bank returned to the market on Tuesday to issue its first and probably only covered bond deal of the year. Despite the more challenging conditional pass through 10 year maturity, the transaction attracted a much deeper well of demand than a competing six year bullet maturity offered by UniCredit’s German subsidiary, HVB.

Aegon Bank has mandated leads for a €500m no-grow conditional pass-through covered bond and UniCredit's German subsidiary has appointed leads for a six year Pfandbrief.

Sparebank 1 Boligkreditt found solid demand for its €1bn seven year on Monday, even though the transaction vied for investors’ attention with another deal in the same maturity.

Crédit Agricole SFH seized an opportunity to issue its fifth covered bond benchmark of the year on Monday and, by pricing flat to its curve, it showed there was little reason to wait for better execution conditions this year.

Bankers expect two or three deals to emerge next week to take advantage of a strong market with no major events due that could cause disruption. It is the perfect window for those with a need to push on with their funding requirements before the onset of summer when execution can become trickier.

TD Securities has hired a trader to cover the euro SSA and covered bond markets, adding euro capacity to a bank that has focused mainly on dollars and other currencies so far. But SSA bankers warned that if the firm plans to break into the euro primary market, it could face a tough time.

Recently de-merged Kommunalkredit Austria (KA) has mandated leads to roadshow the first social covered bond ever to be issued from a public sector programme, and the first green bond from Austria. Rated Baa2, it is also set to be one of the weakest credits in the covered bond universe.

TD Securities has hired a trader to cover the euro SSA and covered bond markets, adding euro capacity to a bank that has focused mainly on dollars and other currencies so far.

La Banque Postale (LBP) attracted strong demand for its 10 year covered bond issued on Wednesday and priced the deal flat to where compatriot Crédit Agricole’s 10 year was trading in the secondary market.

Deutsche Hypo managed to attract only a just subscribed order book for its €500m eight year covered bond this week, despite paying an attractive new issue premium. Bankers on the deal dismissed concern that uncertainty over the issuer’s future ownership had worried investors and blamed market conditions instead.