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Market enters third chapter of 2026, in which issuers and investors strike a more equal balance even though issuers may need to pay up
◆ Macquarie tightened by 6bp to 27bp over ◆ Banker said this represented ‘small new issue premium’◆ Bankers said investor demand for covereds is cooling
◆ Swiss issuer placed both tranches at €750m ◆ Spreads on both tranches tightened by 5bp ◆ ‘This was a slower trade,’ says banker
Data
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Sub-sections
Deal reviews
◆ Spread tightened by 5bp ◆ Banker put fair value just inside 58bp ◆ Canadian banks continue strong start to year in covereds
◆ BayernLB lands covered at 23bp over mid-swaps ◆ Banker says deal landed at fair value ◆ PBB achieves 'blow-out deal'
◆ Covered was first from issuer since October 2025 ◆ Spread chosen to retain quality of order book ◆ Pipeline update
◆ Issuer had market to itself on Tuesday ◆ Deal landed covered just outside fair value ◆ Issuer's first covered bond since October
Opinion
The preference for a diverse group of lead managers and the convention of reciprocity keep covered bond bookrunning competitive despite concentration so far this year
Rate increases could be closer than you think
Equalising risk weightings of covered bonds and resilient STS securitizations at 5% is sound
Bank's head of DCM and syndicate chief talk bond market expansion plans
Analysis
Specialist investors and strong names dominate as issuers stretch out to 15 years
Unsecured bonds could become more expensive to issue, covered bonds cheaper
The euro covered bond market shook off a volatile end to 2024 to rebound with a raft of exceptionally popular deals in 2025. Investors appeared eager to pile into euro covered bond books this year, propelling bid-to-cover ratios upwards and new issue premium downwards, writes Frank Jackman
Covered bond funders will have to weave their way through tight senior unsecured and wide SSA spreads in 2026 if they are to refinance the wave of redemptions that awaits them. One big question for the year ahead, discovers Frank Jackman, is whether issuers will be tempted to pay up for duration
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