Covered Bonds
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◆ Dual tranche trade attracts over €5bn of orders ◆ 'Generous' spread fuels demand ◆ Other household names could tap quiet market before late August rush -
Banks itching to issue as they fight for investor attention to keep premiums tight
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The bank could issue covered bonds secured on Dutch and German loans
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Leads disagreeing on fair value did not matter, as investors voted with their feet
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While it might not be popular with investors, longer dated paper is what covered bond funders need
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Bearish rates outlook to turn as inflation recedes and recession looms
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◆ Longest tranche carries lowest yield ◆ Strong duration bid fuels 15 year print ◆ Investors looking to balance out holding compared to SBI benchmark
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Double digit concession and short tenor drove interest above previous highs
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◆ German bank to tap popular three year point ◆ 'Juicy' start expected ◆ No further supply expected to follow
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Yield curve inversion too steep, putting long tenors out of reach
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The high new issue premium and short tenor assuaged investors’ concerns
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Strong issuers get better than expected traction, sparking opportunistic deals
