Covered Bonds
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Lloyds TSB has filed prospectuses for two covered bond programmes, The Cover has learnt since reporting yesterday (Thursday) that the UK bank was close to finalising its plans.
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Danish covered bond issuers have completed the December auctions of their covered bonds. Dkr300bn (Eu40.3bn) of Danish krone bonds and Eu9bn of euro denominated bonds were sold to investors.
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The Cover understands that the update to the Spanish covered bond framework will finally be completed early in the new year, with a Royal Decree expected in January.
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A draft law that should provide Russia with a viable covered bond framework was ready at the beginning of this month, and market participants hope that it will soon be in place, after the country’s last attempt to catalyse issuance fell short.
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Standard & Poor’s today (Friday) took negative actions on the ratings of 12 major US and European financial institutions, including four covered bond issuers. Separately, it lowered ABN Amro Bank’s rating.
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Fitch yesterday (Thursday) upgraded from AA- to AA+ the WM Covered Bond Program, which JP Morgan took over from Washington Mutual in late September when the latter collapsed. The ratings were, however, constrained as a result of JP Morgan dispensing with a feature of the programme that WaMu had previously added to support the covered bonds’ ratings.
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Standard & Poor’s yesterday (Wednesday) downgraded Crédit Foncier de France (CFF) from A+ to A, and placed BNP Paribas on CreditWatch negative.
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Lloyds TSB appears to have finalised its covered bond programme, according to a regulatory filing.
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Moody’s yesterday (Wednesday) downgraded NIBC Bank’s long term rating and raised questions about the Dutch bank’s reliance on unsecured funding.
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EBS Mortgage Finance yesterday (Tuesday) executed and retained the first deal off a Eu6bn covered bond programme.
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Swedish issuers have told The Cover that it is unlikely they will be making use of the government guarantees available to them for covered bonds. While the costs of such issuance may be interesting relative to guaranteed senior unsecured issuance, other considerations work against it.
