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◆ Spreads tightened on both tranches ◆ Four Spanish covered bond issuers this year ◆ New issue concessions paid on both tranches, says banker
Analysts see covered bond issuance slowing to a more sedate pace from October through to the end of 2026
Volvo, Nykredit and Achmea Bank bring chunky euro FRNs, while Hong Kong dollar issuance continues apace
Data
Sub-sections
Sub-sections
Deal reviews
◆ Only sub-benchmark covered deal in the market on Tuesday ◆ Issuer paid a 'healthy new issue concession', says banker ◆ Pfandbriefzentrale planning new Swiss franc note
◆ Tuesday's only benchmark covered deal ◆ ASN's second covered in six months ◆ Short-end of the curve is an 'investor sweet spot', says bank
◆ Leads picked three Achmea bonds as comps ◆ Dutch bank’s was one of two covereds on Monday ◆ Achmea’s was fourth Dutch covered this month
◆ Issuer chose larger order size ◆ Strong supply of five year covereds cited ◆ Seventh German covered in three weeks
Opinion
Covered bond issuers have been reluctant to issue on the same day as a central bank announcement, but this is starting to change
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
Analysis
Analysts see covered bond issuance slowing to a more sedate pace from October through to the end of 2026
Covered market provides 'the deepest pocket of demand' among FIG asset classes
Asset class is about 5bp wider than at start of the year
Comments from regulators welcomed by ECBC head
More articles
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More from covered bonds
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After Intesa Sanpaolo Vita — the Italian lender’s life insurance unit — hit the subordinated debt market on Tuesday, Credit Suisse followed suit with a euro-denominated Coco on Wednesday. Crédit Agricole’s Coco was delayed by a last minute documentation change, but the FIG markets are on a roll, with SEB and Macquarie bringing senior trades.
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Conditional pass-through bonds gained buyside support on Wednesday when a leading covered bond investor said they could help small, rating-constrained banks from Europe’s periphery. Henrik Stille of Nordea Investment Management was speaking at a panel at the ECBC plenary session in Barcelona. Vulnerable issuers could use the conditional pass-through structure to shore up covered bond programme ratings as the rating agencies are not going to move quickly on positive developments for covered bonds in the Bank Recovery and Resolution Directive.
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Multi-Cédulas are enjoying some investor support, and RBS says they offer good relative value. However many of these Spanish multi issuer programmes face being downgraded to junk and are lagging the country’s government bond rally. Downgrades would spark forced selling, which the existing investor universe would not be big enough to absorb, Crédit Agricole has warned.