Euro

ABN Amro returned to the covered bond market on Thursday with its first deal of 2013, a €1.5bn 10 year. After being out of the market for just over a year, the borrower attracted a comfortably oversubscribed order book in a very short time span, underscoring a much greater depth to the market than ANZ’s recent funding appeared to suggest.

Bankers have played down fresh reports of Dutch government plans to set up a mortgage financing agency to fund low risk mortgages. The topic has been under discussion for some time and the final outcome remains uncertain, bankers told The Cover on Thursday.

Austria’s Raiffeisenlandesbank Niederoesterreich-Wien (RLB NW) is set to price its first deal of the year late in September and mandated leads on Thursday for a benchmark euro deal that will follow a three day roadshow.

Bankers reported on Thursday that there has been barely any movement in Hypo Real Estate Holding bonds since it announced on Monday that it would start looking for a buyer for its Depfa Bank plc subsidiary, thereby fulfilling the European Commission’s conditions for its earlier bail-out.

ANZ Bank’s €1bn five year, priced on Tuesday at 17bp over mid-swaps, was placed with around 50 accounts after leads built a €1.15bn book.

Buying interest for core paper in the secondary market remains buoyant, despite volatility in other corners of the credit markets, and bankers reckon a deal from a strong name would still work. Issuers decided to hold off on Wednesday, however, as Kommunalkredit Austria joined the pipeline.

ANZ Bank launched a five year euro benchmark on Tuesday, despite a weak market backdrop, only a few weeks after it tapped the Aussie dollar market with a 10 year covered bond.

The four euro benchmarks that were priced this week are mostly trading slightly tighter in the secondary market, despite being priced with very small new issue premiums. Along with a period of benign macroeconomic news, the negative net supply of euro benchmarks in 2013 has created a particularly supportive backdrop for new issues, according to covered bond bankers.

The resumption of post-summer covered bond supply continued on Thursday, including the first issue out of peripheral Europe. UniCredit’s €1bn seven year was priced at the tight end of guidance, while Belgian bank KBC also tapped the market for a €750m three year that was well received, confirming the window for issuance remains wide open.

Deutsche Pfandbriefbank priced its fourth covered bond of the year, a no grow €500m five year, only 2bp above its outstanding curve on Wednesday, mimicking the tight pricing in Nordea Bank Finland’s five year trade a day earlier.

Nordea Bank Finland attracted more than €3bn of orders for its five year benchmark on Tuesday morning in what was the first piece of supply from a European issuer since July.

Sparebanken Vest Boligkreditt and Nordea have respectively mandated leads for a roadshow and a deal and another deal from Spain this week has not been ruled out.