Germany

HVB was said to be weathering the storm in the covered bond market reasonably well today (Monday), having built a book of Eu1.5bn for a deal limited at that size at guidance of 3bp over mid-swaps. Investors put its success down to German issuers’ domestic support.

NordLB this (Thursday) morning priced its first jumbo Pfandbrief issue since Landesbanks lost their state guarantees in July 2005, a Eu1bn March 2012 public sector Pfandbrief that is one of the most tightly priced issues since the summer.

Orders on NordLB’s Eu1bn March 2012 public sector Pfandbrief had reached Eu1bn by midday at price guidance of 3bp under mid-swaps, as the deal faced stiff competition in the market from competitors, and some market participants said the pricing looked rich. Meanwhile German supply is set to increase further, with HVB mandating a new jumbo this (Wednesday) morning.

Eurohypo’s Eu2.5bn five year jumbo mortgage Pfandbrief issue was priced this (Tuesday) morning at 2bp over mid-swaps after leads Barclays Capital, BNP Paribas, Commerzbank and Dresdner Kleinwort received orders totalling Eu3.7bn. Meanwhile NordLB is set to launch the third jumbo Pfandbrief in two weeks.

Eurohypo is set to price a Eu2bn five year jumbo mortgage Pfandbrief at mid-swaps plus 2bp, having built a book of Eu3.5bn by 1pm. Bookbuilding began today (Monday) at 9am CET with price guidance of the mid-swaps plus 2bp area.

Commerzbank on Friday announced that it will buy the 49% of Hypothekenbank in Essen that it did not previously own. Meanwhile NordLB is expected to take over Deutsche Hypothekenbank.

Eurohypo will next week launch its first jumbo since this summer’s turmoil erupted and the first benchmark mortgage Pfandbrief since then. The deal will show, after WestLB’s transaction this week, that German issuers are once more finding the market attractive.

WestLB priced its Eu1bn three year jumbo at 5bp through mid-swaps, having built a book of Eu2bn, buoyed by good demand from Asia overnight. The books were closed to European accounts yesterday (Tuesday) afternoon, but to Asian accounts this morning.

Bookbuilding on WestLB’s Eu1bn public jumbo Pfandbrief began at 9.30am CET this (Tuesday) morning and was said at lunchtime by officials at the leads to be going smoothly.

According to reports in the German press last week, Deutsche Postbank is to begin issuing mortgage backed Pfandbriefe in 2008, having requested a licence from the appropriate regulators, the Bundesbank and the Federal Financial Supervisory Authority (BaFin).

Depfa is setting up a 144A US MTN programme and is on the road in the States. Until now Depfa has issued its 144A benchmark deals on a standalone basis.

Banque Fédérale des Banques Populaires has mandated Natixis to arrange a Eu25bn covered bond programme to refinance prime home loans originated by the 20 members of the group.