Germany

Around Eu3.5bn of orders within one hour for Landesbank Berlin’s three year jumbo public sector Pfandbrief this morning allowed the bank to achieve pricing at the tight end of its mid-swaps flat to minus 1bp range, making it the first benchmark covered bond to be priced inside Libor this year.

After the success of Landesbank Berlin’s public sector Pfandbrief issue this morning, other issuers are eyeing the primary market, hoping that the jumbo will not prove a one-off. However, LBB’s deal could be the exception rather than the rule, if some investors are to be believed.

DnB Nor Boligkreditt will soon be joining the throng of international issuers touting registered covered bonds to German investors. However, the Norwegian issuer is already enjoying an embarrassment of riches in the private placement market after selling its Eu2bn five year benchmark in mid-January.

Deutsche Apotheker und Ärztebank eG has confirmed its intention to enter the jumbo covered bond market, although its debut is still some way off, according to the bank. Initial expectations that the bank would issue in the second quarter may be frustrated.

The primary market’s calm this week has come as no surprise, but bankers are looking for clues to future activity and BankInter is regarded by some as having the necessary strength to reopen the Spanish market, with the multi-sellers finding little favour in the current market.

Moody’s has assigned a triple-A rating to Series 1 of Landesbank Berlin’s (LBB) Daheim 2 structured covered bond programme.

Deutsche Apotheker und Ärztebank eG (apoBank), Germany’s largest primary co-operative bank, with Eu35.9bn of total assets as of 30 June 2007, plans to issue its first mortgage Pfandbrief.

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.

The once-proud name of Hypothekenbank in Essen is taking its last bow with the announcement today that Commerzbank will be merging it into Eurohypo. The disappearance of one of the trailblazers of the jumbo Pfandbrief market was seen as inevitable since last year when Commerzbank made clear its intention to take full control of its part subsidiary and with the resignation of Essenhyp founder and chairman Hubert Schulte-Kemper last March.

Analysts embarked on a perilous quest at the IMN covered bond conference in London yesterday afternoon. Armed only with data and pricing models, they set off in pursuit of relative value, pausing briefly to discuss adequate disclosure.

Landesbank Berlin has mandated Deutsche Bank, Dresdner Kleinwort and UniCredit for a public sector jumbo Pfandbrief issue, which is expected after a European roadshow later this month. Meanwhile, the bank’s plans to launch what would be the first structured covered bond from Germany are still live.

Deutsche Postbank has priced its first jumbo mortgage Pfandbrief at 2bp, the tight end of the 2bp-4bp guidance. Following the SEB’s success, Postbank made it a good week for debut issues with a rapid bookbuilding process and strong secondary market performance.