Covered Bonds

In brief: HSH Nordbank has mandated the first government guaranteed deal from Germany.

Louis Hagen is leaving his position as executive director of the Association of German Pfandbrief Banks after nine years to become a member of the board of managing directors of Münchener Hypothekenbank. He will be replaced by Jens Tolckmitt. [Expands on earlier news alert.]

In brief: Norwich & Peterborough Building Society yesterday (Wednesday) set up two companies that are expected to be used for covered bond issuance.

The Australian Treasury is investigating whether it should allow covered bond issuance after a recommendation from a parliamentary economics committee in the country. The MP chairing the committee told The Cover that should the government legislate in favour of covered bonds it would reverse the Australian regulator’s current prohibition of issuance.

The Taiwanese government and banks in the country have been in discussion about the potential use of covered bonds, The Cover understands.

The Securities Industry and Financial Markets Association held the inaugural meeting of the US Covered Bond Council steering committee in New York yesterday (Wednesday) afternoon. Meanwhile, a member of Sifma’s US covered bond traders committee has left his firm.

Rating action: Moody’s yesterday (Tuesday) placed on review for downgrade Bayerische Landesbank’s Aa2 rating, citing pressure on the bank’s financial strength rating and the bank’s changing shareholder structure.

Caixa Geral de Depósitos is expected to make a decision shortly on whether or not to be the next bank to enter the government guaranteed market as spreads widen under supply pressures. Meanwhile Société Générale has again kept jumbo covered bond issuance from flat-lining with a tap for a French issuer.

Rating action: Fitch today (Wednesday) assigned ratings to EBS Mortgage Finance, a fully owned subsidiary of EBS Building Society that has been set up under Ireland’s covered bond legislation.

The pricing of new issues in the government guaranteed and SSA market was backing up this (Tuesday) morning, with borrowers satisfied to get deals away in a crowded market where the clock is ticking on issuance windows this year.