Covered Bonds

Moody’s assigned its first rating to a Russian covered bond on Tuesday. The ratings agency has given a provisional Baa1 long term rating to Rb5bn of Series 09-IP mortgage covered bonds to be issued by DeltaCredit Bank.

Belgium’s KBC Bank plans to issue a covered bond this year, it said on Thursday, following publication of its third-quarter results.

Sparebank 1 Boligkreditt printed only the second seven year dollar covered bond since 2007 on Wednesday, pricing 2bp inside where Stadshypotek brought the first in September but with a modest new issue premium. Separately, the issuer explained that its covered bond encumbrance was at the lower end of the Norwegian spectrum.

Belgium’s KBC Bank plans to issue a covered bond this year, it said on Thursday, following publication of its third quarter results. Meanwhile Belfius Bank told The Cover it was also ready to bring its first deal before the end of 2012. The banks are free to launch the deals after the Belgian central bank gave regulatory clearance last week.

Dexia group plans to dispose of its French municipal financing entity Dexia Municipal Agency (DMA), it revealed on Thursday, when releasing third quarter earnings. In outlining its new structure, it clarified that Dexia Credit Local (DCL) would no longer be a shareholder.

Moody’s has assigned its first rating to a Russian covered bond. The ratings agency has given a provisional Baa1 long term rating to Rb5bn of Series 09-IP mortgage covered bonds to be issued by DeltaCredit Bank.

South Korea’s proposed Covered Bonds Act should boost issuance, according to Fitch, which says the new law addresses areas important for investor protection.

Virgin Money, the bank that acquired Northern Rock’s performing mortgage book, opened books for its Gosforth 2012-2 on Wednesday. The RMBS transaction shows the publicly syndicated ABS issuance can still make sense despite the cheap funding offered by the Bank of England’s Funding for Lending Scheme (FLS).

Deutsche Pfandbriefbank launched a £250m seven year covered bond on Tuesday morning at a level that surprised bankers who thought the bonds might not be fully placed. Leads Goldman Sachs and Nomura opened books at 90bp over Gilts, a level that one lead told The Cover offered relative value versus the seven year part of the curve.

Crédit Mutuel-CIC is poised to launch its debut covered bond in dollars, a deal that would have come last week if not for Hurricane Sandy, The Cover understands. Thursday will be the first opportunity this week for the issuer, according to a person familiar with the matter, due to the US presidential election on Tuesday.

Santander Totta and Caixa Geral de Depósitos, two of Portugal’s leading banks, are both considering whether to issue senior or covered bond deals, in the wake of Banco Espírito Santo’s breakthrough senior issue earlier this week. Bankers say neither bank has decided which route to go down.

Landesbank Hessen-Thüringen Girozentrale (Helaba) this week launched the first benchmark covered bond from core Europe in over a month and became only the second issuer in four years to price a benchmark trade through mid-swaps.