Germany

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.

Optimism that the nadir of the Greek crisis has passed helped Caisse de Refinancement de l’Habitat and Eurohypo launch successful benchmark covered bonds this (Wednesday) morning.

Standard & Poor’s yesterday (Thursday) affirmed its AAA ratings of Dexia Municipal Agency’s obligations foncières and WestLB’s public sector Pfandbriefe. However, WestLB’s Pfandbriefe would lose their triple-A rating if the issuer were downgraded by one notch.

Aareal Bank yesterday (Monday) priced a Eu500m five year mortgage-backed Pfandbrief at 20bp over mid-swaps, tighter than any benchmark covered bond this year.

Aareal Bank was first into the covered bond market this (Monday) morning, opening books on a Eu500m five year mortgage Pfandbrief. Meanwhile, Groupe Caisse d’Epargne is building a shadow order book for its first benchmark since September 2008 and a handful of other issuers have announced mandates.

Fitch yesterday (Thursday) placed on Rating Watch negative (RWN) the mortgage Pfandbriefe of eight German banks and maintained a negative review on another’s over what it higher risk in commercial real estate lending and limited collateral information. The Association of German Pfandbrief Banks (vdp) has called the timing of the rating action “incomprehensible”.

Standard & Poor’s will no longer rate Landesbank Baden-Württemberg’s Pfandbriefe or other debt after the German bank ended its contract with the rating agency. The covered bond issuer is believed to be the first to have done so since S&P announced its controversial new rating methodology on 16 December.

Deutsche Pfandbriefbank yesterday (Monday) built a Eu1.1bn order book for its third benchmark covered bond since the restructuring of Hypo Real Estate Group, a Eu1bn seven year public sector Pfandbrief. The level of oversubscription was not particularly high, the issuer told The Cover, but investor demand was strong enough to allow Pfandbriefbank (pbb) to hit its target.

Three issuers announced mandates this (Monday) morning, ensuring that the pipeline remains bulging even after three issuers closed books on new issues, as the pace of supply showed no sign of relenting in the second week of the new year.