Covered Bonds

Unione di Banche Italiane’s (UBI) €1bn 10 year Obbligazioni Bancarie Garantite from Monday was priced tighter than UniCredit’s deal with matching size and tenor, even though demand was lower and the domestic bid greater.

Compagnie de Financement Foncier (CFF) enjoyed a strong reception for the seventh 10 year covered bond in little over two weeks.

Natixis Pfandbriefbank priced its debut publicly syndicated transaction on Wednesday after previously only issuing private placements.

Bank of Nova Scotia issued the first sterling fixed rate covered bond in 18 months in a larger than expected size and at a funding level that was not possible in either euros or dollars.

One or two covered bonds could be seen early next week before the European Covered Bond Council’s (ECBC) plenary meeting and the Euromoney covered bond conference. The market on Thursday, however, was waiting for the European Central Bank meeting amid hopes that the central bank will announce further stimulus measures.

Bank of Nova Scotia has issued the first sterling fixed rate covered bond since March 2015. The positive yielding five year tenor proved a more appropriate maturity than the prevailing 2026 slot which euro issuers have crowded into and the funding was cheaper than a five year dollar covered bond.

The German subsidiary of Natixis issued its first publicly syndicated covered bond on Wednesday, selling the 10 year issue mainly to German based investors.

Belfius Bank has priced the first Belgian covered bond inside a French covered bond and with virtually no new issue concession.

The covered bond market was in good shape on Tuesday but it was in good shape this time last year too. With core covered bond valuations still out of sync with other asset classes, bankers warn that the market has become complacent and another correction is due.

Natixis Pfandbriefbank (NPB) has mandated joint leads for its first publicly distributed Pfandbrief, which will be launched on Wednesday.

Compagnie de Financement Foncier (CFF) enjoyed a strong reception for its fourth covered bond of the year, the seventh 10 year issue in little over two weeks. Despite the surfeit of 10 year supply and meagre spread to OATs, the transaction was smoothly executed.

Unione di Banche Italiane’s (UBI) €1bn 10 year Obbligazioni Bancarie Garantite was priced tighter than UniCredit’s €1bn 10 year and well through BTPs, though it relied more heavily on domestic buyers.