Covered Bonds

The Bank of Queensland (BOQ) has mandated joint leads to roadshow its newly set up conditional pass-through (CPT) A$3.25bn (€2.18bn) covered bond programme.

Suomen Hypoteekkiyhdistys (Hypo) and Bank of New Zealand have announced marketing programmes ahead of expected covered bond deals.

Skipton Building Society is looking to diversify its wholesale funding, and is expected to issue covered bonds and senior debt.

Berlin Hyp (BHH) issued a tightly priced Pfandbrief on Wednesday, drawing strong demand for a rare deal backed by green commercial mortgage assets. At the same time the Mortgage Society of Finland mandated leads for a sub-benchmark transaction.

Banco Popular Espanol’s covered bonds barely reacted to credit stress afflicting bonds further down its capital structure ahead of the Spanish lender’s resolution on Tuesday evening. This may have illustrated the effectiveness of the Covered Bond Purchase Programme (CBPP3) but also showed confidence in the asset class, the regulator and the Spanish banking system.

More active central bank buying has helped prop up peripheral covered bonds, which have seen better real money selling interest lately. Despite its troubles, covered bonds issued by the beleaguered Banco Popular Espanol (BPE) have held up.

Berlin Hyp (BHH) is expected to open order books for it second Green Pfandbrief on Wednesday and Bank of New Zealand has mandated leads to roadshow a possible senior or covered bond deal later this month.

Garanti Bank is expected to issue the first green mortgage-backed Turkish covered bond, which will be privately placed with the International Financial Corporation (IFC) and certified by a third party.

Berlin Hypothekenbank (BHH) is expected to issue its second green Pfandbrief next week alongside one or two other transactions. The new issues follow an eventful May, while June could also prove a busy month.

Nationale-Nederlanden Bank (NN Bank) has registered its covered bond company, suggesting it plans to follow Rabobank with a debut deal. The move could lead to less Dutch RMBS supply, where it had been a regular issuer alongside Delta Lloyd, with which it is merging.

Commerzbank has signalled its intention to formally pull out of the ship Pfandbrief business, while NordLB is considering a sale of Deutsche Hypo to shore up capital after absorbing BremerLB’s loss-making shipping business.

Intesa Sanpaolo was unable to tighten pricing for its barely subscribed €1bn 10 year Obbligazioni Bancarie Garantite on Wednesday as mounting political risk in Italy caused a distinct change in sentiment.