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◆ Aussie bank has primary to itself on Friday ◆ Deal ‘sufficiently different,’ say bankers ◆ Both tranches offer small premiums
French company diversifies funding after inaugural dollar deal last year
The new European Secured Note market is keen to secure regulatory recognition for the new product but there are advantages to not having it
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Sub-sections
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Deal reviews
◆ Aussie bank has primary to itself on Friday ◆ Deal ‘sufficiently different,’ say bankers ◆ Both tranches offer small premiums
The awards recognise the market's leading deals, issuers, banks and other participants
◆ German bank lands flat to fair value ◆ Order book closes at over two times covered ◆ Deal NordLB's first in almost a year
◆ Issuer lands in 'the place to be' amid strong demand for covereds ◆ Achieves its largest covered book since at least 2023 ◆ After 7bp tightening the bond was spotted another 2bp tighter to erase new issue concession
Opinion
The new European Secured Note market is keen to secure regulatory recognition for the new product but there are advantages to not having it
If it looks like a covered bond, acts like a covered bond and prices like a covered bond, then it probably should be treated like one
Easily dismissed as "fast money" with all the negative implications that can bring in the primary bond market, hedge funds are becoming increasingly important to covered bond issuers
The fears of the covered bond market reflect a lack of conviction in the superiority of the product
Analysis
Benchmark issuance is running 13% ahead of last year
Burst of deals this year in uneven market suggests investors want alternatives to Treasuries
Central and Eastern Europe earmarked as an area of growth by market participants
With masses to fund and spreads super-tight, banks will race to market, but central banks are expected to tighten
More articles
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More from covered bonds
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Covered bonds will help Virgin Money achieve its stated aim of optimising funding costs and extending tenor, especially when taking account of its latest Gosforth RMBS, which gave funding that was both short and more costly compared to covered bonds.
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The Italian parliament approved a new law earlier this month that is expected to help finance a broad range of assets. Investors of the secured bonds have recourse to the underlying asset pool as well as an unsecured claim against the issuer.
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The soft bullet maturity extension currently being considered for introduction into Germany’s Pfandbriefe law would lower the chance of a payment interruption and could mean issuers need to set aside less collateral to achieve the same rating, said Fitch. Soft bullet bonds would also not be subordinate to hard.