Covered bond secondary trading betrays weakness in some markets

Spread trading screen adobe stock AS
By Bill Thornhill
21 Sep 2020

Last week’s surge in covered bond issuance caused certain Norwegian deals to trade more softly by Monday. But traders viewed it as a buying opportunity, given robust technical backdrop.

Eika Boligkreditt’s €500m March 2028, issued last week at 7bp over mid-swaps, was bid wide of reoffer on Monday. Other older and less liquid Norwegian deals were trading a more cheaply than newly issued deals, said a covered bond trader on Monday.

Last week sentiment had been more ...

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