Covered Bonds

Leeds Building Society yesterday (Tuesday) became the first UK issuer to publicly place a sterling residential mortgage covered bond, a move that an official at the issuer told The Cover he hopes will help generate momentum in the development of a domestic covered bond market.

Fitch placed AAA rated mortgage covered bonds issued by Banco Espírito Santo, Millenium BCP, and Banco BPI on negative review yesterday (Tuesday), following a downgrade of the banks’ ratings the previous day.

When Kookmin Bank completed its $1bn covered bond in May 2009, market participants applauded and predicted the start of a vibrant new business in Asia. Now, disenchanted muttering greets talk of the same covered bond as proverbial tumbleweed rolls by.

Abbey National Treasury Services plans to issue registered covered bonds off a Eu25bn global covered bond programme, the issuer announced yesterday (Monday).

*Change relative to last week. Due to technical problems, we are unable to link to this table from the homepage.

Leeds Building Society has opened order books on its first benchmark covered bond, a 10 year deal that also marks the first sterling covered bond from a UK issuer in over five years.

Nordea Bank Finland will today (Tuesday) price a Eu2bn five year inaugural benchmark covered bond after building one of the biggest order books for a euro issue this year, while Austria’s Hypo NOE Gruppe Bank met with sufficient demand to sell a Eu500m three year inaugural public sector Pfandbrief.

An April 2016 Caisse de Refinancement de l’Habitat issue was the only new benchmark covered bond live in the market this (Monday) morning, but with three other issuers lining up deals and two more borrowers announcing mandates the pipeline of forthcoming new issues and roadshows is well stocked.

Norway’s Ministry of Finance is considering a recommendation from the country’s central bank that would allow Norwegian issuers to repurchase early covered bonds submitted as part of a government swap arrangement and thereby better manage their refinancing needs.

Leeds Building Society is lining up to re-open the sterling covered bond market next week, while other inaugural deals are expected to lead a resumption of new benchmark issuance in euros.

*Change relative to end September. Due to technical problems, we are unable to link to this table from the homepage.

Sampo Housing Loan Bank is preparing to resume issuing covered bonds for the first time since being acquired by Danske Bank in 2006 as part of a takeover of its parent, Sampo Bank, an official at Dankse told The Cover.