France

Despite considering a new issue, La Caixa looks unlikely to follow-up on Monday’s reopening of the Spanish market by Santander, but a French issuer is instead said to be due to launch a benchmark deal today (Wednesday).

Fitch yesterday (Tuesday) affirmed the AAA rating of Société Générale’s covered bond issuing arm, SG Société de Crédit Foncier, after downgrading SG SCF’s issuer rating.

BNP Paribas sold a Sfr275m (Eu183m) September 2014 covered bond yesterday (Monday) at a spread of 75bp over mid-swaps, the tight end of 75bp-80bp guidance. It was the first public mortgage-backed covered bond in the Swiss franc foreign market since September and the largest in over a year.

Compagnie de Financement Foncier has closed books on the longest dated covered bond since July 2007, a 12 year obligations foncières benchmark via HSBC, Natixis and Société Générale.

Fitch yesterday (Monday) downgraded Société Générale’s covered bond issuing arm, SG Société de Crédit Foncier.

Fitch today (Monday) downgraded Société Générale from AA- to A+ due to concerns about the bank’s profitability, in particular in the investment banking division.

Compagnie de Financement Foncier yesterday (Wednesday) reopened a March 2013 Swiss franc deal for the third time, and attracted broad support for the tap.

German accounts have been exerting a greater influence on the jumbo covered bond market this week, even if French issuers continued to be the main players and supply remained confined to taps.

Taps are the order of the week in the covered bond market, with at least four expected to have been completed by tomorrow (Friday).

Two obligations foncières issuers yesterday (Thursday) tapped outstanding deals, while a third French institution this week placed covered bonds with dollar investors.

Münchener Hypothekenbank today (Thursday) became the fifth institution to tap outstanding issuance this month, with flows in jumbo covered bonds proving encouraging, and another tap is said to be underway.

The recent trend of covered bond issuers tapping outstanding jumbos continued today (Tuesday), while one French name is said to have this week tested investor sentiment for a new issue.