Germany

Moody’s has downgraded Deutsche Bank’s long term senior debt rating from Aa1 to Aa3.

A positive reception for Erste Group’s inaugural public sector benchmark covered bond demonstrated that perceptions of Austrian credit have moved on after a period of negative headlines, a syndicate official at one of the leads told The Cover. Meanwhile, Dexia wrapped up its forth benchmark covered bond of the year.

Deals for Dexia Kommunalbank and Erste Group got the primary market off to a strong start this (Tuesday) morning, with both issues oversubscribed and executed swiftly. Further issuance is expected this week, with SNS Bank already sounding out a new issue.

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 new subsidiary of the Association of German Pfandbrief Banks, vdpResearch, has developed an index that tracks price developments of German owner-occupied housing. The index forms part of a real estate index family that vdpResearch plans to roll out in the coming year.

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.

Rarity value and good name recognition among investors helped Westfälische Landschaft Bodenkreditbank yesterday (Thursday) price a Eu1bn long five year public sector Pfandbrief at the tightest level of any covered bond benchmark for a year-and-a-half. The issuer told The Cover that at such a level a jumbo appearance made sense from several perspectives.

WestLB will price a Eu1bn five year public sector Pfandbrief this (Friday) afternoon on the back of a more muted response from investors than that enjoyed by a similar deal for Westfälische Landschaft Bodenkreditbank yesterday (Thursday).

Moody’s has downgraded Deutsche Postbank’s rating from Aa3 to A1, on negative outlook, because it considers the bank’s risk profile to have increased.

Benchmarks launched this (Thursday) morning for BNP Paribas Public Sector SCF and Westfälische Landschaft Bodenkreditbank were two and three times oversubscribed, respectively. Such strong support, notably from German accounts, enabled the Pfandbrief to become the first jumbo priced in the single-digits over mid-swaps since August 2008, and another deal has already been announced.

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.

Eurohypo yesterday (Wednesday) priced its first jumbo Pfandbrief of the year, a Eu1.5bn three year deal that tapped a maturity the issuer had not used for a new benchmark since before the onset of the financial crisis.