UK

Aareal Bank and UniCredit Bank Austria priced successful euro deals in five and 10 year maturities on Monday, while Abbey issued a three year in sterling. All three priced at the tighter end of initial thoughts. However, prospective core borrowers with larger funding needs may need to offer more tempting spreads as the market softened on Monday.

Lloyds Bank issued the first sterling covered deal from a UK issuer in the home currency since May 2012 on Tuesday. Despite pricing at a fraction of the 170bp spread that Clydesdale Bank paid for the last UK sterling floating rate deal, Lloyds managed to achieve the highest level of demand for this format in local currency.

Greencoat UK Wind, a renewable energy investor, has raised £83m through a placing, open offer and offer for subscription.

Co-operative Bank has asked holders of its £600m Moorland covered bonds due November 2021 to vote on an extraordinary resolution.

Bank of Scotland is to tender four covered bonds denominated in euros and sterling, it said on Monday.

Primary covered bond market activity swelled on Tuesday, with as many as four deals pricing since Monday’s close in Europe. Commerzbank, Nykredit and Westpac all made appearances (see other story) but, the pride of the pack was Abbey, which priced the first publicly syndicated UK covered bond in almost two years, setting a target size of €1bn.

The covered bond market will benefit from the UK regulator’s changes to eligible securities for bank liquidity buffers, according to Barclays research, but it has warned many questions remain about the new rules.

Investors should consider switching out of the senior unsecured debt issued by Abbey National and Lloyds Banking Group and buying their covered bonds, said Barclays on Friday. The scarcity of supply in both asset classes has driven a technical tightening which, the analysts say, is not fundamentally justified.

National Australia Bank has responded to reverse enquiry from cash-laden sterling investors by selling a £500m three year sterling floater on Tuesday, in what is the first piece of benchmark sterling issuance since January.

Santander UK has announced a new deal from its Holmes master issuer RMBS shelf. The prospective deal is likely to offer a significant spread pick up compared to UK covered bonds. And Rabobank has privately placed RMBS issuance from its Obvion subsidiary.

Münchener Hypothekenbank tapped its recent three year sterling floater for another £100m on Tuesday, taking advantage of a market window before holidays and programme updates prevent issuance.

Aareal Bank closed a £200m sterling FRN on Wednesday, making its public debut in the currency two decades after entering the UK commercial real estate market.