Pfandbrief duo show ECB crowding out effect

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By Bill Thornhill
13 Feb 2020

Covered bonds issued this week by Berlin Hyp and Deutsche Hypo would have struggled without demand from the European Central Bank, suggesting the central bank is crowding out investor demand from the private sector.

At almost €700m, interest in Berlin Hyp’s €500m seven year mortgage Pfandbrief, which is rated Aaa and was issued on Monday, was adequate enough. But without the ECB’s €200m order, the deal would have only just been subscribed.

Deutsche Hypo managed a marginally better, but still unconvincing, ...

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