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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
More articles
More from covered bonds
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A widening in the basis swap between three and six month Euribor and a recent rise in yields have improved the attractiveness of covered bonds for a proportion of investors. But for many others, bonds that trade well through swaps in the secondary market are only fit for the European Central Bank. -
Investors wasted little time placing orders for NIBC Bank’s €500m 10 year conditional pass-through covered bond that was issued on Wednesday, reflecting that it offered the highest spread of any covered bond issued this year by any bank in core Europe. This is also likely to be a very rarely issued structure.
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Although UK covered bonds are trading at their tightest levels for the last year, they still offer a decent pick-up versus some international peers. With the UK’s vaccine rollout and growth expectations showing promise, spreads may well tighten. But there is a lack of fresh supply. Some is needed to improve price discovery and catalyse performance.
