France

All four institutions that had indicated that they would come to market this week opened their order books today (Tuesday), but had little trouble achieving price and size targets in the middle of or better than those being aimed for.

Swedbank Mortgage will today (Monday) price a seven year covered bond at the tight end of guidance of the 60bp over mid-swaps area. The deal marks the beginning of what looks set to be a busy week in the covered bond market as other issuers have rushed to secure their place in a line-up that is already four institutions deep.

SNS Bank has mandated lead managers for a new covered bond that is expected this week, and several other issuers are said to be candidates for issuance in the coming days.

A period of instability brought on by mounting concerns about peripheral sovereigns meant that Banco Popolare had to wait more than three weeks to launch a deal after embarking on a roadshow, but the issuer was rewarded with an oversubscribed order book and strong support from real money accounts. Meanwhile Caisse de Refinancement de l’Habitat has launched two taps.

WestLB took advantage of positive momentum in the covered bond market to price the fourth benchmark of the week last Friday, and bankers today (Monday) said that it remains open to new issues.

Standard & Poor’s has affirmed the covered bonds of Nationwide Building Society, Banques Populaires, and HSBC Bank at AAA, but downgraded those of Yorkshire Building Society to AA+. An upcoming redemption could lead to positive rating action for Yorkshire, however.

Dexia Municipal Agency broke a lull in the primary market with a Eu1bn eight year obligations foncières issue yesterday (Wednesday) that demonstrated the viability of issuance in spite of the fragile market conditions, with two issuers today (Thursday) following suit and another announcing a mandate.

Dexia Municipal Agency is today (Wednesday) bookbuilding for an eight year obligations foncières issue that is the first benchmark covered bond of the week, and Dexia’s first since the European Commission approved the group’s restructuring plan earlier this month.

Two new French covered bond programmes are being planned by existing issuers, with one turning to obligations foncières for the first time and the other looking to issue obligations à l’habitat.

Standard & Poor’s has affirmed the AAA ratings of a further four covered bond programmes under its new rating methodology. The programmes are those of DekaBank Deutsche Girozentrale, NRW.Bank, DnB Nor Boligkreditt, and BNP Paribas Public Sector Société de Crédit Foncier.

Crédit Mutuel-CIC priced the third benchmark covered bond of the week yesterday (Thursday) afternoon, but with the European Union’s statement in support of Greece having failed to calm nerves, the two day burst of activity could prove to have marked the eye of the storm, rather than its end.

Crédit Mutuel-CIC this (Thursday) morning launched its second benchmark in just over a month, marketing a seven year transaction that follows a five year deal sold on 7 January.