Covered Bonds

The cover pool backing Goldman Sachs’ fixed income global structured covered obligation (Figsco) programme is too weak to secure a rating uplift to the issuer of the underlying special purpose vehicle — Goldman Sachs Mitsui Marine Derivatives Products (GSMMDP), the joint venture guaranteed by Goldman Sachs and Mitsui Sumitomo Insurance, Fitch said on Monday.

A US covered bond legal framework may soon be back on the political agenda. A speech by Jacob Lew, US Treasury secretary, last week has caught the attention of market participants, who hope a covered bond bill may be detached from reform of the US government-sponsored enterprises, Fannie Mae and Freddie Mac.

UniCredit Bank Austria (UBA) has tripled the share of non-profit housing loans in its mortgage pool in a year and reduced the share of riskier commercial mortgages, in a move which Moody’s said was credit positive for its Aa1 programme.

With €70bn sold this year, covered bond issuance should trounce last year’s €98bn total. Better still, with several countries returning to the market and regulations likely to improve market conditions for covered bonds, this year’s progress should be sustained for years to come.

Toronto-Dominion Bank could become the next Canadian bank to issue a covered bond after it received regulatory approval from the Canada Mortgage and Housing Corp (CMHC) for its first legally compliant covered bond. Overall covered bond issuance is set to exceed last year’s supply as old borrowers return and new ones consider their first deals.

Covered bond issuance in June was the strongest since 2011 and issuance over the year as a whole is in line to meet the €130bn forecast that Barclays research analysts made in December last year, the bank said on Thursday. UK, Canadian and Italian issuance may bolster supply over the second half of the year other bankers and analysts said.

The Cover’s annual awards for the covered bond market will be held at the Garden Palais Lichtenstein in Vienna on the evening of September 25. The awards celebrate the most important achievements in our market — as decided by the market.

With €70bn sold this year, covered bond issuance should trounce last year’s €98bn total. Better still, with several countries returning to the market and regulations likely to improve conditions, this year’s progress should be sustained for years to come.

Bayerische Landesbank took advantage of an empty market to price what could be one of the last covered bonds before the summer lull kicks in. The €500m seven year Pfandbrief attracted a heavily oversubscribed and granular book that gained solid momentum from the start — in contrast to other recently issued Pfandbriefe.

Bayerische Landesbank took advantage of an empty market to price what could be one of the last covered bonds before the summer lull kicks in. The €500m seven year Pfandbrief attracted a substantially oversubscribed and granular book that gained solid momentum from the start — in contrast to other recently issued Pfandbrief.

Standard & Poor's upgraded BBVA’s mortgage backed covered bond programme from A to AA- after the European close on Tuesday, while Fitch upgraded UniCredit’s Italian programme from A+ to AA-. The upgrades take the programmes towards a level that gives regulatory benefits. UniCredit has most to gain.

Luca Bertalot, Secretary General of the EMF and ECBC, speaks to The Cover following Tuesday's EBA report.