Three covered bond issuers took advantage of a rise in yields, following what seemed a breakthrough in Brexit negotiations, to issue transactions that would not have been well received two weeks ago. Banca Popolare dell’Alto Adige’s debut and Sparkasse Hannover’s sub-benchmark deals delivered positive returns, while demand for a slightly negative-yielding benchmark from Sparebanken Sør Boligkreditt was boosted by its green credentials.
Bund futures reached a new low since their early September highs on Thursday, dragging yields higher across the board.
Ten year euro swaps were at 0.05% compared to minus 0.17% on October 8. Seven year swaps yielded minus 0.12% compared to minus 0.3% little more than a week ago.