Italy

Crédit Mutuel-CIC this (Thursday) morning launched its second benchmark in just over a month, marketing a seven year transaction that follows a five year deal sold on 7 January.

Benchmark supply is expected to be thin on the ground this week, even though some institutions have concluded preparations for covered bond issuance. But while blackouts and an unpredictable sovereign market might stymie euro supply, bankers have not ruled out shorter dated issuance from core jurisdictions.

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.

A Eu1bn 10 year obbligazioni bancarie garantite issue for UBI Banca yesterday (Thursday) showed that despite the approaching year-end there is still demand from investors looking for yield at the long end of the curve, said a syndicate official at one of the leads.

UBI Banca launched a Eu1bn 10 year mortgage-backed covered bond this (Thursday) morning, tackling the complications of launching a new issue close to year-end to prevent this week from becoming the first since the week of 22 June without any benchmark supply (including taps).

UBI Banca is understood to be holding investor meetings from today (Monday) to Wednesday, although a syndicate official familiar with the meetings said that they were not directly deal driven.

Banca Carige on Wednesday positioned itself in the benchmark covered bond market for the first time, with a Eu1bn seven year issue. As a mid-sized regional bank that is primarily funded by deposits, it had to overcome weak name recognition, but the issuer told The Cover that it is satisfied with the reception its benchmark received in the end.

Banca Carige will price a Eu1bn seven year debut benchmark covered bond this (Wednesday) afternoon at a level that met with a strong response from investors even though some were left with disappointed expectations.

Banca Carige is likely to set the maturity of its debut benchmark covered bond at seven years, according to market participants. Meanwhile, a Spanish name is said to be looking closely at the market with the possibility of an imminent deal and Dexia’s Luxembourg registered arm is aiming to settle some unfinished business.

UniCredit yesterday (Monday) priced a Eu1bn long 12 year deal that is only the fifth Italian benchmark covered bond, and the first this year to come with a maturity other than seven years. The issuer told The Cover that the transaction was intended to expand the obbligazioni bancarie garantite yield curve and thereby facilitate the positioning of Italian covered bonds.

UniCredit will today (Monday) price a Eu1bn long 12 year obbligazioni bancarie garantite issue at 60bp over mid-swaps, a level that one syndicate banker suggested would have been difficult to achieve a week ago before market conditions took a turn for the better.

The benchmark covered bond market is set to experience a welcome slowdown this week, with Abbey National the only issuer widely expected to launch a deal as others busy themselves with the preparatory work of meeting with investors.