Germany

Several foreign banks are closely investigating the possibility of opening a bank in Germany as a prelude to being able to issue Pfandbriefe, an endeavour that has become more attractive as a result of a funding advantage that the German covered bond product has gained over the past several years, Jens Tolckmitt, chief executive of the Association of German Pfandbrief Banks, told The Cover.

Fitch affirmed public sector-backed Pfandbriefe of Düsseldorfer Hypothekenbank at AAA yesterday (Tuesday), and removed them from Rating Watch Negative, following an annual review of the programme.

Issuers of six out of eight German mortgage Pfandbrief programmes that Fitch has had on negative review have provided detailed information about commercial mortgages in their cover pools that the rating agency requested, while two have not yet done so.

Bayerische Landesbank this (Wednesday) morning increased a 2014 public sector-backed Pfandbrief by Eu125m, becoming the second German issuer this week to price a tap through mid-swaps.

Münchener Hypothekenbank today (Monday) priced a Eu125m tap of a June 2015 benchmark mortgage Pfandbrief through mid-swaps.

Standard & Poor’s affirmed at AA+, on stable outlook, its rating of Deutsche Pfandbriefbank’s public sector-backed covered bonds on Friday and removed them from CreditWatch developing, where it had placed the covered bonds on 16 April after cutting them from AAA to AA+.

Eurohypo today (Friday) added Eu250m to a June 2015 mortgage Pfandbrief in the only euro benchmark supply this week.

Toronto-Dominion launched a $2bn five year inaugural covered bond yesterday (Thursday), becoming the fifth Canadian bank to tap the dollar market with a covered bond this year. Compagnie de Financement Foncier today launched the fourth euro tap of the week, increasing its recent 15 year deal by Eu450m.

Fitch yesterday (Monday) downgraded the long term rating of HSH Nordbank from A to A-, and left it on negative review, in expectation of a reduction in ownership by Hamburg and Schleswig-Holstein.

WestLB will drop its DBRS and Standard & Poor’s ratings and replace them with Fitch ratings, it announced yesterday (Thursday).

Landesbank Baden-Württemberg priced a $500m three year benchmark covered bond in the middle of its 70bp over mid-swaps area guidance yesterday (Thursday). Some market participants questioned the economics of the transaction, but LBBW’s head of funding stressed the strategic value of the Eurodollar issue.