Covered Bonds

Swedbank Hypotek wasted little time in moving from blackout to benchmark this week, and launched its first euro jumbo covered bond since 2011 on Thursday. Other Nordics are emerging from reporting periods and at least one also has an eye on a euro transaction, said bankers.

The shipping crisis will last longer than expected and is keeping German banks in particular under pressure, Fitch said on Thursday.

Moody’s downgrade of Commerzbank and Hypothekenbank Frankfurt (Hypfra) will leave Commerzbank’s covered bonds unscathed but push Hypfra’s public sector bonds down to Aa2, analysts said on Wednesday.

The transfer of assets from Spanish banks to the country’s bad bank (Sareb) has reduced the collateral available to protect Cédulas investors, Fitch said on Wednesday. However, the fall has been compensated by an increase in higher quality eligible collateral, so the net reduction in security value has been relatively small.

Aareal Bank closed a £200m sterling FRN on Wednesday, making its public debut in the currency two decades after entering the UK commercial real estate market.

Asset encumbrance remains a big concern for regulators and this is likely to hit covered bond issuance, Deutsche Bank said on Wednesday. More regulators will address the issue, said Deutsche, after the Dutch central bank (DNB) became the latest market supervisor to flag its unease. This followed the lead of Scandinavian supervisors, who raised concerns last year.

Sparkasse KölnBonn returned to covered bonds in style on Tuesday, breaking through into the single digits over mid-swaps for its first benchmark deal in five years.

Aareal Bank is the latest German borrower to tap the sterling market, having approached investors with price thoughts for a £200m three year floater.

Hard work rather than a change in terminology led to the surge in interest for Nykredit Realkredit’s latest senior secured deal, an official at the issuer told The Cover on Tuesday. Almost 140 accounts produced its biggest order book yet for a senior secured deal.

Hard work rather than a change in terminology led to the surge in interest for Nykredit Realkredit’s latest senior secured deal, an official at the issuer told The Cover on Tuesday. Almost 140 accounts produced its biggest order book yet for a senior secured deal.

Sparkasse KölnBonn is set to announce a deal in the belly of the curve, somewhere in the region of five years, bankers told The Cover on Monday. Other issuers, possibly from Europe’s periphery, are also considering deals, said bankers, after further strong performance in the secondary market.

Nykredit Realkredit launched a euro benchmark junior covered bond on Monday after marketing the deal as a senior secured transaction. This approach helped draw traditional covered bond buyers and credit accounts into the deal, which was priced at half the spread and with twice the orders that its last outing in the rare asset class achieved.