Covered Bonds

Raiffeisenlandesbank Niederoesterreich-Wien (RLB NW) launched an inaugural benchmark covered bond on Tuesday, building a four times oversubscribed book for a 10 year mortgage backed trade.

Crédit Agricole gave an investor presentation for its new Obligations Foncières (OF) programme in Paris on Wednesday, ahead of what could be the first covered bond from a French issuer since late March. But though the domestic buyer base is desperate for fresh supply, covered spreads are uncomfortably close to OATs.

Covered bond issuance is on hold while the European Central Bank’s meeting in Frankfurt commands all attention. ECB president Mario Draghi is expected to provide details of a sovereign bond purchase programme and peripheral sovereign spreads have already tightened in expectation. But analysts said investors fearing a disappointing programme could switch to into covered bonds — with Cédulas the most likely to benefit from such a shift.

Australia and New Zealand Banking Group drew $4.5bn in orders for its latest financing, a dual tranche dollar covered bond, and followed competitor Commonwealth Bank of Australia in selling a senior unsecured transaction in the same sitting.

Crédit Agricole gave an investor presentation for its new Obligations Foncières (OF) programme in Paris on Wednesday, ahead of what could be the first covered bond from a French issuer since late March. French spreads have stopped grinding tighter in the secondary market, but some names still trade flat or even through OATs.

German Pfandbrief issuers have pushed primary spreads to record lows, but with minimal hope for secondary performance at such tight levels investors could start to push back on pricing.

Münchener Hypothekenbank made history this week, pricing the tightest ever euro benchmark covered bond. Despite the sub-Euribor level the public sector backed deal drew broad European demand that surprised even the issuer, a spokesman for which told The Cover it intends to return with another benchmark deal later in the year.

Austria’s Raiffeisenlandesbank Niederoesterreich-Wien (RLB NW) sold its inaugural benchmark covered bond on Tuesday, building a four times oversubscribed book for a 10 year mortgage backed trade.

Australia and New Zealand Banking Group returned to the dollar covered bond market on Tuesday, attracting several new accounts in its first dollar deal since opening the market for Australia at the end of 2011.

Münchener Hypothekenbank on Monday launched one of the tightest euro benchmarks ever sold and took covered bonds into sub-Euribor territory for the first time in over four years.

The French Ministry of Economy and Finance released a press release on Saturday evening saying that it would guarantee the debt of Caisse Centrale du Credit Immobilier de France (3CIF) and its subsidiary CIF Euromortgage, subject to approval from the European Union and the French Parliament.

UniCredit’s German arm HypoVereinsbank (HVB) returned to the covered bond market for the first time in almost a year on Monday. HVB extended its curve by seven years with a 10 year mortgage Pfandbrief, and divided syndicate bankers with its pricing.