Covered Bonds

These charts and tables provide an overview of all benchmark covered bond issuance from January-August 2010, breaking down total supply by country, currency, and maturity, and comparing this year's volumes with those of previous months and years.

These charts and tables provide an overview of covered bond issuance from January-August 2010, breaking down total supply by country, currency, and maturity, and comparing this year's volumes with those of previous months and years.

The Bank of Spain is introducing a new regulation requiring that Spanish issuers disclose detailed information on assets backing cédulas. Moody’s today (Monday) said that this should increase investors’ confidence in assessing credit risk and lower borrowers’ funding costs, even if it said that there is room for improvement, and other market participants gave qualified approval of the initiative.

Standard & Poor’s placed 53 Spanish multi-cédulas transactions on CreditWatch Negative on Friday and will review the potential impact of pressure on the creditworthiness of Spanish banks, deteriorating collateral values, and decreasing overcollateralisation available to the underlying cédulas.

Italy’s UBI Banca is today (Monday) following through with a seven year benchmark covered bond that it postponed in early summer, while the UK’s Nationwide Building Society is preparing to return to the market for the first time in three years and Deutsche Kreditbank has priced a Eu500m five year issue.

La Caixa sold a Eu1bn three year cédulas hipotecarias yesterday (Thursday), with its standing helping it achieve the benchmark size in spite of pricing some market participants had considered ambitious. However, although the bank made it four cédulas in just over a week, market participants were ambivalent about the levels of subscription and the performance of the week’s supply, not only from Spain.

Italy’s Banca Carige was happy to follow UniCredit into the obbligazioni bancarie garantite market yesterday (Wednesday), selling a Eu500m three year issue. UniCredit, meanwhile, was pleased with its results after having waited to issue since June, the issuer told The Cover.

La Caixa this (Thursday) morning launched the fourth cédulas in a week, a three year issue that bankers away from the leads said was ambitiously priced, after Banco Sabadell yesterday became the first Spanish issuer to reach a Eu1bn deal size since July. The Spanish covered bond was the only new benchmark in the market this morning, after issuers including CM-CIC and Royal Bank of Scotland wrapped up new issues yesterday.

Denmark’s Nykredit will tomorrow (Friday) begin a September round of auctions to refinance adjustable rate covered bonds maturing in October, and although volumes are higher than in previous years the supply is expected to be well absorbed.