France

Caisse de Refinancement de l’Habitat is to return to the market in benchmark size at both the long and short end in the near future, with the covered bond market continuing to work its way through its list of reliable issuers, following Sparebank 1 opening books today and the German public sector issuance of the last fortnight.

CIF Euromortgage has today (Thursday) begun roadshowing a new registered covered bond programme with arranger Landesbank Baden-Württemberg, joining the growing ranks of international issuers keen to take advantage of a market that German issuers have long tapped through Namenspfandbriefe, which account for around one-third of Pfandbrief supply. The sector was also recently joined by a first cédulas issuer.

With the secondary market avoiding negative headlines for once, market participants were pleased to report stable spreads across the board. Following the first French issuance of the year last week, German bonds have become increasingly isolated, leaving traders and analysts to discuss the growing gap with France.

Compagnie de Financement Foncier priced its first benchmark of the year this morning, a Eu1.5bn three year obligations foncières priced at 3bp over mid-swaps. The Cover spoke to Paul Dudouit, head of funding at CFF, about the issuer’s start to 2008.

Lead managers Calyon, HSBC and Natixis have opened books on a new three year obligations foncières (OF) for Compagnie de Financement Foncier (CFF). The deal’s pricing and reception have given further clues to the shape of the new French issuing world, as well as other top notch covered bonds such as Pfandbriefe.

Dexia Municipal Agency has priced its long-awaited Eu2bn long five year deal at 4bp over mid-swaps, redrawing the obligations foncières pricing map and the pricing landscape for other issuers at the tight end of the market.

Dexia Municipal Agency is set to price a new five year issue at guidance of 4bp over mid-swaps through ABN Amro, Deutsche Bank and SG CIB, having built a book of over Eu2bn. Read The Cover tomorrow for the full story and the new pricing paradigm for obligations foncières.

Bad news hit French and German covered bonds this morning, stymieing issuance plans, but in spite of a sharp sell-off in equities one Spanish issuer is said to be close to launching the first cédulas of the year.

BNP Paribas’ Eu2bn three year covered bond was priced this morning, although there are doubts over whether this represents a full reopening of the French market, with pricing still disjointed even within jurisdiction due to varying collateral types, name differentiation and the choice between structured covered bonds or the old obligations foncières.

BNP Paribas Covered Bonds priced its three year issue in the middle of guidance and with a size of Eu2bn this lunchtime, having built a book of more than Eu3bn in what one syndicate official away from the deal called the most successful deal of the week. However, the pricing outlook for French covered bonds is unclear, with the Banque Populaire group (BFBP) coming out with guidance of 20bp-22bp over and still no sign of a deal from Compagnie de Financement Foncier, which gave a mandate for an issue at the beginning of last week.

Caisse de Refinancement de l’Habitat (CRH) has priced its new two year euro jumbo and a tap of its now Eu2.81bn October 2014 deal this afternoon (Wedneday). Pricing on the jumbo was set at 1bp over mid-swaps, against guidance of plus 2bp area.

Caisse de Refinancement de l’Habitat had built a book of over Eu1.5bn for its new two year jumbo today and more than Eu300m for its tap, with pricing expected tomorrow.