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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
◆ 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
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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Toronto Dominion Bank attracted a slightly larger order book for its three year dollar covered bond on Friday than Bank of Nova Scotia did for a similar deal issued on Wednesday. Both deals offered a considerable pick-up to where they would have been expected to be priced in euros, but the overall spread outlook remains a subject for hot debate. At the same time on Friday, Canadian Imperial Bank of Commerce was set to issue a ‘blow out’ three year Swiss franc deal. -
The coronavirus crisis has made it difficult for banks to know how much wholesale funding they will need in the coming years. But when a window opened in the primary market this week, issuers showed that they are still focused on trying to build up their levels of total loss-absorbing capacity (TLAC), write Tyler Davies, David Freitas and Bill Thornhill.
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Hesitant covered bond issuers, that had been waiting for the European Central Bank to commence buying under its Pandemic Emergency Purchase Programme (Pepp), may no longer have an excuse to wait and should return to the market soon — particularly since funding levels are cheap relative to senior unsecured, but also because wider spreads may reflect the deterioration in credit risk as opposed to liquidity risk.
