Covered Bonds

Citi has taken on Christof Jütten to work on covered bonds in its European debt capital markets division, which is headed by Eirik Winter.

Abbey National Treasury Services plc negotiated a shaky spell in the covered bond market to come away with a Eu1.75bn seven year benchmark priced at the tight end of guidance yesterday (Wednesday). Funding officials at the issuer told The Cover that they were “delighted” with the pricing of the transaction.

Danske Bank yesterday (Wednesday) issued a Nkr800m (Eu95m) fixed rate note to complete its Norwegian krone follow-up to a Eu1.25bn six year euro benchmark it sold last Wednesday.

An overnight increase of Eu466m in settled covered bond purchases under the European Central Bank’s programme means that this week’s tally is already the third highest since the ECB started providing daily updates on spending under the scheme, with one more day to go before the thirteenth full week of reporting concludes.

Dutch covered bonds registered with the country’s central bank under the Dutch covered bond law will benefit from higher continuity in the event of a default of the issuing bank, said Fitch yesterday (Tuesday). The rating agency has improved the Discontinuity Factors for all registered Dutch covered bonds, and separately affirmed NIBC Bank’s covered bonds at AAA.

Abbey overcame the weaker tone the covered bond market has faced since last week by adopting what bankers away from the leads called a cautious approach to pricing this (Wednesday) morning. Meanwhile two debut issuers that were already rumoured to be in the pipeline announced official mandates.

The European Central Bank programme’s covered bond buying pressed on with a Eu402m increase in settled purchases reported this (Wednesday) morning, ahead of the governing council’s meeting and any related monetary policy announcement tomorrow (Thursday).

Fitch today (Wednesday) affirmed the ratings of covered bonds issued under 17 programmes following implementation of the rating agency’s new refinancing cost assumptions. The AAA rating of Marfin Egnatia Bank’s covered bonds was affirmed separately yesterday (Tuesday) as the structure of the rating has changed.

Fitch is reviewing its assumptions for assessing the credit quality of commercial mortgage loans backing covered bonds, and has kept or placed mortgage-backed covered bonds issued by nine German banks under analysis pending implementation of these revised assumptions.

Moody’s yesterday (Tuesday) confirmed the Aaa ratings assigned to Norwich & Peterborough’s covered bonds following a restructuring of the issuer’s programme.

A crisis at Crédit Foncier de France and the imminent arrival of the euro called for action to support French lenders in the late 1990s. The French establishment responded by drawing on inspiration from northern Europe and a 19th century instrument closer to home.