Euro

Compagnie de Financement Foncier kept its ambitions modest this (Friday) morning in the tough market, going out with an 18 month obligations foncières issue at mid-swaps flat that could be limited to Eu500m.

Caja de Ahorros del Mediterráneo looked to be taking the record covered bond benchmark spread 7bp wider this (Friday) morning with guidance of 80bp over mid-swaps for a two year cédulas just two days after Banco Pastor priced its Eu1bn two year at 73bp over. But while the pricing was seen as necessary for the deal to get done, it caused dismay in the wider market where other potential issuers have been finding soft-sounding frustrating.

Spain’s Banco Pastor successfully priced a new Eu1bn two year cédulas hipotecarias at the widest ever level for a publicly offered covered bond, with one lead manager saying this was simply the level investors would buy at, and that market volatility meant that even comparing new issues to bonds launched as recently as May was fruitless.

An unlikely candidate reopened the covered bond market this (Wednesday) morning, with Banco Pastor opening books on a two year cédulas hipotecarias with price guidance that made it the widest ever publicly offered covered bond.

Aktia has successfully gained the consent of noteholders to change the provisions of its covered bonds with respect to maturity and repurchases after it was granted extra flexibility by Moody’s in the way it runs its programme.

The covered bond market had a deflated feel to it this morning (Thursday) following the temporary postponement of the Swedish Covered Bond Corporation’s new issue. However, market participants refused to be derailed with leads suggesting the bond could return soon in slightly altered form if conditions change. Meanwhile, those outside the deal were unwilling to believe the primary market completely was closed.

Danske Bank priced a new five year covered bond yesterday afternoon (Tuesday) backed by international mortgage collateral from its Cover Pool I. The deal was increased from the minimum target of benchmark size and enjoyed an untroubled bookbuilding process.

After several hours of bookbuilding today, SCBC has pulled, at least temporarily, the short four year euro benchmark deal that it had expected to price later today. The leads blamed market volatility but the deal was also suffering as it came in a similar tenor to the recent Swedbank and DnB Nor new issues that had made heavy weather of bookbuilding.

Danske Bank has opened the books on a new five year euro benchmark bond backed by international residential mortgage collateral from its innovative Cover Pool I this morning. Like NordLB’s new five year public Pfandbrief, it was bolstered by robust support from domestic investors.

NordLB priced a new Eu1bn five year jumbo Pfandbrief at the tight end of guidance this morning after bookbuilding strongly yesterday. It was supported by a strong domestic bid and the shrinking supply of public Pfandbrief, with issuers from other classes and regions looking on enviously at the pricing still achieved from the product.

In brief: With the primary market still active, one Scandinavian issuer has joined the pipeline and a French borrower has completed its roadshow. Meanwhile a fellow Scandinavian issuer has added Namenspfandbriefe to its funding options.

Société Générale’s Eu1bn debut five year obligations foncières launched last week might have struggled for oversubscription but the issuer said today that both the pricing of the bond and the structure of the cover pool had fully satisfied investors.