Covered Bonds

Pimco, after staying clear of Portuguese bank or sovereign debt for five years — was in Lisbon recently to investigate opportunities in the troubled peripheral jurisdiction generated by the ongoing Banco Espirito Santo (BES) headlines. The meetings came as several sell-side research analysts tipped Portuguese covered bonds as a good relative value opportunity versus periphery peers.

The rating of 24 covered bond programmes from across EMEA could be up to four notches higher without the constraint of sub triple-A local currency country risk ceiling (LCC), analysis from Moody’s revealed on Tuesday. Within a given jurisdiction, the risk ceiling defines the highest rating achievable for an issuer’s print in the local currency.

Deutsche Hypothekenbank, NordLB’s commercial real estate subsidiary, opened books on Monday for its first Pfandbrief of the year. Despite the time of year – this deal is the first German issuer to price a deal in the second half of July for over four years – leads attracted a heavily oversubscribed order book. Credit market conditions in the Euro area provided a constructive backdrop for execution, with Bunds stable and periphery markets recovering.

Toronto Dominion’s first legally compliant covered bond stormed the market on Monday morning, raising €1.75bn – €750m more than any of the other five Canadian euro benchmarks that have been launched this year.

We are delighted to announce voting for The Cover’s 2014 awards has started.

Christoph Anhamm, RBS's head of covered bond origination, is leaving the bank to take up a broader position at ABN Amro, GlobalCapital understands. Tim Skeet is said to be taking over the position at RBS.

The five year area of the covered bond curve saw solid demand in the secondary market this week, especially for bonds originated from outside the European Economic Area (EEA). The rally was driven by speculation that a recent proposed change to the liquidity coverage ratio (LCR), which would allow banks to count such bonds in their liquidity buffers, could be approved.

The first draft of the Pfandbrief Act 2015 offers some remarkable novelties, according to Commerzbank research, which said in its latest weekly publication that proposed changes should not cause any headaches — and may even improve transparency. Moody’s agreed saying that the draft proposals were credit positive.

Deutsche Hypo has mandated joint leads for a €500m five year mortgage Pfandbrief to be launched in the near future.

Christoph Anhamm, RBS's head of covered bond origination, is leaving the bank for ABN. Tim Skeet will take over the position.

German bankers, who had been busy nursing sore heads after celebrating their country’s World Cup victory last Sunday night, will not have been overly taxed by DG Hypothekenbank’s drive-by Pfandbrief syndication on Monday. Being the rarest issuer from one of the most technically squeezed jurisdictions in Europe, a strong outcome was never in doubt. Painkillers were however required for the allocation process.

Landesbank Hessen-Thueringen (Helaba) sealed its place as the largest covered bond issuer so far this year after doubling the size of a seven year public sector backed Pfandbrief on Thursday. The approach, which mirrors last year’s strategy, has enabled the bank to raise a lot of funding at competitive levels while giving investors much needed liquidity, as well as minimising its asset-liability mismatches.