Spain

Banca Popolare di Milano, Kutxa and Swedbank Mortgage accessed the benchmark covered bond market this (Tuesday) morning to offer investors a medley of new euro issues after a day of preparation yesterday that one syndicate banker said was necessitated by limited liquidity in the market.

Two inaugural euro covered bonds backed by residential mortgage backed securities were this (Monday) being flagged for possible launch this week.

Moody’s assigned a Aa1 rating to mortgage backed covered bonds of Caja España yesterday (Tuesday), after rating the new entity Baa1, on stable outlook.

The covered bond market is in good condition and generally open for issuance, syndicate bankers reported today (Monday), but with no new mandates publicly announced since last Thursday a deal from Italy’s Intesa Sanpaolo was this morning the most concrete new issue project in the pipeline for the week.

Italy’s UBI Banca will today (Thursday) price a Eu500m five year issue on the back of modest demand, while DnB Nor Boligkreditt yesterday sold its first dollar benchmark covered bond and Canadian Imperial Bank of Commerce priced its first covered bond in the Kangaroo market.

Spain’s Unicaja was keen to use the launch of a cédulas hipotecarias issue this week as an opportunity to engage with investors on issues facing the country’s financial system and to highlight the savings bank’s individual story, an official at the issuer told The Cover.

Skandinaviska Enskilda Banken will today (Wednesday) price a Eu1bn seven year issue at the tight end of revised guidance after meeting with strong demand for the first Swedish euro benchmark since June. Meanwhile, Italy’s UBI Banca is gauging interest for a new issue, Canadian Imperial Bank of Commerce has opened books for an Australian dollar debut, and a mandate for a debut off an innovative programme has been added to the deal pipeline.

Spain’s Unicaja will today (Tuesday) price a Eu750m five year cédulas hipotecarias issue, more than a marketed Eu500m minimum deal size, although syndicate bankers away from the leads said the deal had at times appeared to struggle. Issuance was otherwise restricted to a tap and floating rate note, although there are rumours of deals in the pipeline and CIBC has mandated for an Australian dollar debut.

Italy’s UniCredit launched a Eu1bn maximum seven year issue this (Monday) morning that syndicate bankers away from the deal complimented for being “bang-on”, while Spain’s UniCaja is testing investor interest for a Eu500m minimum five year cédulas.

Fitch cut mortgage backed covered bonds issued by Spain’s Cajastur from AAA to AA+ and placed them on Rating Watch Negative yesterday (Thursday), because of a downgrade of the issuer the previous day.

Banco Popular Español achieved a high hit rate on an exchange offer that was completed yesterday (Monday), with around Eu1.4bn of Eu3.5bn of bonds eligible for the exercise being swapped into a new, Eu1.75bn five year cédulas hipotecarias issue – the maximum that the Spanish bank could raise.

Abbey National Treasury Services today (Monday) launched a seven year covered bond that is the euro benchmark market’s first new issue since fellow UK issuer Lloyds TSB Bank sold a Eu2bn 10 year deal last Wednesday. Meanwhile, Banco Popular Español has completed an exchange offer and the first jumbo Pfandbrief since June is being prepared.