Italy

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.

Banca Popolare di Milano returned to the market yesterday (Thursday) with its second benchmark covered bond, fulfilling a promise to investors to come to the market once a year with a deal of up to Eu1bn, the issuer told The Cover. Meanwhile Banca Carige is understood to have awarded the mandate for what could be the next Italian covered bond and would be its debut public issue.

Banca Popolare di Milano will price a Eu1bn seven year issue of obbligazioni bancarie garantite, launched this (Thursday) morning, at the tight end of guidance. The deal takes the number of new benchmarks launched this week to eight, a record for the covered bond market. Meanwhile Intesa Sanpaolo has retained a new issue off its public sector programme.

Barclays Bank will tomorrow (Tuesday) launch the first benchmark UK covered bond since November 2007 and the first since the Regulated Covered Bond regime came into effect, a 10 year deal that is expected to be at least Eu2bn and at price talk tighter than that heard last week. The deal will hit another frenzied week for covered bonds, with at least two further issues likely in the coming days on top of three today (Monday), and more new names in the pipeline.

Representatives of Italy’s leading issuers and investors discuss the potential for obbligazioni bancarie garantite in this roundtable discussion sponsored by UniCredit, exploring issues such as credit quality, the prospective investor base, and pricing considerations.

Bilbao Bizkaia Kutxa will this (Tuesday) afternoon price its Eu1bn five year cédulas hipotecarias debut at 58bp over mid-swaps, a “punchy” level that bankers said signalled that pricing expectations might need to be revised tighter. And a tighter level than expected is already being rumoured on the first of several new issues in the pipeline, which includes Dutch, Portuguese and Italian supply.

UBI Banca experienced one of the fastest official bookbuilds for a covered bond when its Eu1bn seven year obbligazioni bancarie garantite debut attracted more than Eu6.5bn of orders in just 15 minutes yesterday (Tuesday) afternoon, according to a syndicate official at one of the leads.

In brief: UBI Banca has opened books on its debut obbligazioni bancarie garantite, a seven year issue that is capped at Eu1bn.

National Bank of Greece has joined the new issue pipeline after awarding the mandate for its inaugural benchmark covered bond. UBI Banca’s debut issue will probably be launched tomorrow (Tuesday), if a technical issue is resolved in time, according to syndicate officials at the leads.

Bank of Ireland as good as signalled the complete recovery of the covered bond market, in terms of access at least, by launching a Eu1.5bn five year deal that is the first Irish issue in the public markets since June 2007. And while spreads for such issuers may remain at unprecedented levels, the strong rally is nevertheless encouraging many credits to explore possible new issues.

Fitch yesterday (Tuesday) changed the rating outlook on Banca Popolare di Milano from stable to negative.