Nordics

Finland will include covered bonds within its planned guarantee scheme, according to a ministry of finance official. However, the impact of the guarantees for covered bonds is likely to be limited.

Rating action: The Swedish Housing Finance Corp, SBAB, was yesterday (Wednesday) downgraded by Standard & Poor’s from AA- to A+. The AAA ratings of the covered bonds of its subsidiary, the Swedish Covered Bond Corp, were not affected.

Sparebanken Vest Boligkreditt today (Monday) executed its inaugural covered bond issue, but, like other Norwegian issuance in the past month, it is being retained.

Anyone worried about deteriorating asset quality and the state of European mortgage markets would have felt their spirits lifting during the opening panel of the European Mortgage Federation’s sixth annual conference in Brussels yesterday (Thursday). Representatives from Denmark, Poland, the Netherlands, Germany and Belgium painted a reassuring picture of the state of their country’s mortgage markets.

In brief: Storebrand Kredittforetak has increased and retained its Nkr1.5bn May 2011 issue by Nkr2bn to further build up its unutilised holdings of covered bonds that can be used to access Norges Banks’ liquidity facility.

Norway’s Sparebanken Vest is preparing to launch its first covered bonds, having set up Sparebanken Vest Boligkreditt.

The European bond market is bracing itself for a pick-up in guaranteed senior unsecured issuance from a wider range of jurisdictions as banks put the final touches to their new documentation and regulators release precise details of their respective guarantees.

While the Swedish National Debt Office has announced the fixed fees for its guarantee scheme and the bank-specific fees for guaranteed senior unsecured debt, market participants are still waiting for news on the individual fees that will be charged for guaranteeing covered bonds.

The Finnish parliament is debating a government proposal for state guarantees for banks’ unsecured debt and The Cover understands that the guarantee is expected to be extended to covered bonds, as in Sweden but not most other countries.

Standard & Poor’s yesterday (Wednesday) upgraded the ratings on the covered bonds of Nykredit Realkredit’s General Capital Centre from AA to AAA in light of a new rating approach. In addition, AAA ratings were assigned to all the other covered bonds issued by Nykredit and subsidiary Totalkredit.

The Danish Ministry of Economic & Business Affairs and the Danish Insurance Association today (Friday) announced a set of initiatives to support the Danish life insurance and pension sector, and Danish covered bonds.

Storebrand Kredittforetak has increased its Nkr1bn April 2011 issue by Nkr500m (Eu58m), following DnB Nor Boligkreditt and Sparebank 1 Boligkreditt in building up unutilised holdings of covered bonds that it can use to access the Norges Bank liquidity facility that was announced on 12 October.