Covered bonds have room to rally — for now

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By Bill Thornhill
06 Nov 2019

A major investor in covered bonds told GlobalCapital this week that his firm was still positive on the near-term outlook for eurozone covered bonds, as they had lagged behind a more general credit spread tightening. That meant covered bonds still offered attractive value compared with government bonds, while the European Central Bank was stepping up its buying.

Although Caffil issued the tightest 10 year French covered bond of the year on Tuesday, the investor, who works for an asset manager, said the market had not tightened as much as credit spreads on other products, and had also lagged the tightening seen in government bonds and ...

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