Covered Bonds
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◆ Debut deal spotted tighter in secondary ◆ Some investors keen to get lines in place for future issues ◆ Buyers fine with unusual structure -
Rising supply and a lack of secondary market performance put investors off covered bonds
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◆ Issuer meets target with debut deal ◆ Deal comes 2bp back of recent Italian supply ◆ Trade follows two day marketing period
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◆ Issuer takes £750m with first deal since 2021 ◆ Trade the joint tightest three year deal of 2024 ◆ Small premium paid
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◆ UK lender takes £500m ◆ Deal land single digits back of recent supply ◆ No-grow size supported demand
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From elections to equivalence, it has been an interesting year for the euro covered bond market. As the European Central Bank has fully left the market, covered funders have needed to unearth new — and returning — pockets of demand. In early August, GlobalCapital virtually convened a panel of issuers, investors and intermediaries to discuss what shaped euro covered bond issuance this year, and what is in store for 2025
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Euro covered bonds are becoming an increasingly global product. Offshore issuance is on the rise as banks — and investors — look to diversify their portfolios, writes Frank Jackman
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Covered bonds are not just for mortgages. Interest in secured funding is growing across Europe as issuers look to use all the assets on their balance sheets. But regulatory requirements could hinder development and push issuers to seek out alternative modes of financing, reports Frank Jackman
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Though issuance may fall short of hitting record heights in 2024, the euro covered bond market looks in robust shape, with longer tenors and tighter prices available for issuers. Austin Barnes writes that the data from GlobalCapital’s Primary Market Monitor shows just how strong conditions have been
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Wide breadth of choices is enabling investors to be picky
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◆ Deal comes close to yields on Italian govvies ◆ Tight level puts off some investors ◆ More Italian issuance due
