Covered Bonds

Chelsea Building Society and Yorkshire Building Society are set to merge, creating an enlarged building society to be known as Yorkshire Building Society, the institutions announced today (Wednesday). Moody’s has affirmed Yorkshire’s ratings and put Chelsea’s on review for upgrade.

Pfandbriefbank schweizerischer Hypothekarinstitute took advantage of tight spreads in the Swiss franc market to raise Sfr435m (Eu308m) yesterday (Tuesday) afternoon, in what is expected to be its last issuance of 2009.

Deutsche Hypothekenbank, Hannover, has appointed Jürgen Allerkamp chairman of the management board. The bank has also announced the departure of two board members, including Jürgen Grieger, former president of the Association of German Mortgage Banks.

Moody’s yesterday (Monday) downgraded Nykredit Realkredit’s junior covered bonds from Aa2 to Aa3, concluding a review for possible downgrade initiated on 11 September.

The European Central Bank reported the fourth biggest day’s increase to its covered bond buying this (Tuesday) morning, a Eu542m rise in settled purchases that takes the total to Eu25.811bn.

Fitch affirmed the AAA rating of Deutsche Pfandbriefbank’s public sector Pfandbriefe on Friday and removed it from rating watch negative following a review of the issuer’s cover pool and an increase in overcollateralisation.

Total settled covered bond purchases under the European Central Bank’s Eu60bn programme increased Eu134m to reach Eu25.269bn this (Monday) morning. Only two eligible public deals settle this week, although an ECB press conference on Thursday could provide some interest in a quiet week.

UBI Banca is understood to be holding investor meetings from today (Monday) to Wednesday, although a syndicate official familiar with the meetings said that they were not directly deal driven.

The split of covered bond issuer Kommunalkredit Austria became effective this weekend, into a new bank known as Kommunalkredit Austria and a company, KA Finanz, that will hold the former Kommunalkredit’s non-strategic assets and be wound down. Outstanding covered bonds are understood to have been allocated to the new bank.

A group of small Norwegian banks has set up a mortgage credit institution, Verd Boligkreditt, for the joint issuance of covered bonds. It will be run on their behalf by Sparebanken Vest, which also has its own covered bond vehicle.