Deal reviews

  • HVB enjoys strong Pfandbrief execution

    HVB returned to the covered bond market for its first and only mortgage-backed covered bond benchmark of the year on Tuesday and enjoyed a solid reception. The choice of tenor, deal size and timing all played important roles in the deal’s success.

Analyst research

  • Carinthia supports Pfandbriefstelle; Austrian RV spotted

    The Austrian state of Carinthia announced that it will provide a line of liquidity support to Austria’s Pfandbriefstelle. The decision suggests a slight improvement in the negative political backdrop dominating Austrian banks. Despite continued concerns, the recent sell-off has thrown up relative value opportunities, said analysts.

Market wrap

  • Improved sentiment boosts supply hopes

    Sentiment improved across the board on Monday, and especially in the covered bond market where Commerzbank issued an oversubscribed seven year tap which it increased from the minimum size during bookbuilding. The increase made a stark contrast to last week’s deals and suggests scope for another transaction on Tuesday. Despite a very supportive technical backdrop, the second quarter outlook is less certain with concern over Greece set to mount, said bankers.

Secondary market

  • Northern Rock AM tenders for covered bond

    Northern Rock Asset Management (NRAM) made a tender offer for its €2bn 3.875% November 2020 on Monday and will pay a 2% premium. The bank has also proposed an extraordinary resolution to redeem all notes other than those tendered, for which it will not pay a premium.

Rating news

  • Moody’s applauds removal of Heta exposure from German Pfandbriefe

    The decision to remove Heta exposure from Pfandbriefe collateral pools and add substitute assets has strengthened the position of investors and has demonstrated the importance that the German banking industry places on the reputation of the Pfandbrief product, said Moody’s on Monday.

Regulatory developments

  • Covered bond swaps carve-out confusion

    Earlier this month the Bank for International Settlements (BIS) released a document suggesting that covered bonds would not be excluded from two way swap agreements. The policy document was completely at odds with earlier regulation from Europe’s Market Infrastructure Regulator (EMIR) and the European Banking Authority, which allow one way covered bond swap agreements. The different outcomes suggest that, unless a global consensus is reached, the swap carve-out may only apply to European covered bonds, bankers told The Cover on Tuesday.


  • When RMBS are safer than covered bonds

    Covered bonds and RMBS share important similarities which both the European Central Bank and Bank of England acknowledged last year in a discussion paper. As the two asset classes evolve, their vastly different regulatory treatment should become more difficult to justify. A comparison of Rabobank’s Storm 2015-1 RMBS, originated by its Obvion subsidiary, to a forthcoming conditional pass through covered bond to be issued by Van Lanschot Bankiers shows that regulation remains a more important determinant of price than fundamental credit risk.

People moves

  • EBRD observer joins Label’s advisory council

    The European Bank for Reconstruction and Development (EBRD) has appointed Hugh Friel, a manager in the bank’s Local Currency and Capital Market Development Team, as its representative on the advisory council of the covered bond Label. The appointment reflects the EBRD’s role as an anchor investor and policy advisor for covered bonds from Central and Eastern European and Turkey.

RMBS primary news

  • Rabobank’s RMBS is cheap to Dutch conditional pass throughs

    Rabobank’s Obvion subsidiary sold nearly €2bn of five year RMBS last Thursday, at a considerable spread pick up to where Dutch pass-through covered bonds from entities with much weaker ratings would be expected to price. The deal, originated by one of the best rated banks in the world and backed by very high quality collateral, suggested that covered bond investors could be missing out by not looking at the RMBS market.

Mandates & deal pipeline

  • Singaporean covered bond breakthrough in sight

    DBS is on course to become the first covered bond issuer from Singapore, having proposed a unique structure that will overcome the sticky issue of who has first claim on the asset pool. An agreement is close to being struck and the Singaporean lender is looking then to issue a benchmark size offering in either dollars or euros.

  • Aktia Bank mandates for roadshow

    The Finnish issuer has mandated leads for a roadshow that starts on March 16.

  • Van Lanschot joins the CPT crowd

    Dutch issuer Van Lanschot Bankiers has become the third issuer to set up a conditional pass through programme, joining NIBC and UniCredit. Pending successful registration with the Dutch central bank, a deal should be coming soon.

In-depth analysis and interviews

  • Podcast interview: Covered bonds and Capital Markets Union

    The Cover interviews Luca Bertalot, head of the European Covered Bond Council, and Carsten Trisbæk Madsen, Chairman of the ECBC, on how covered bonds and dual recourse structures can play a role in Europe’s Capital Markets Union. [Best seen on Google Chrome or the latest version of Internet Explorer]

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Book runner

Covered bonds €500m+ YTD to Mar 27  2015

Lead manager Amount
No of Issues Share %
1 Natixis 3.90 25 9.6
2 HSBC 2.93 15 7.2
3 Credit Agricole 2.79 17 6.8
4 BNP Paribas 2.79 12 6.8

 league table builder

All covered bonds YTD to Mar 27 2015

Lead manager Amount
No of Issues Share %
1 Natixis 4.50 28 6.4
2 Barclays 3.91 18 5.6
3 HSBC 3.84 19 5.5
4 RBC CM 3.80 10 5.4

 league table builder