The Danish FSA (Finanstilsynet) set out proposals for a “Supervisory Diamond” for Denmark’s mortgage credit institutions on Thursday of last week (11 September) that aims to reinforce the Danish industry’s systemic stability, including moves away from one year ARMs and interest-only (IO) loans.
Danske Bank sold its first sterling covered bond on Monday, a £500m (Dkr4.64bn, Eu624m) three year floating rate note that attracted £800m of demand despite coming at the same time as a £1.5bn Barclays Bank covered bond in the same format.
DLR Kredit is close to bringing to an end the latest round of refinancing auctions by Denmark’s mortgage credit institutions (MCIs), having today (Thursday) finished its auctions of one year ARM bonds, while BRFkredit has said it is pleased with the response to its new, pre-financed bonds.
Nordea Kredit wrapped up three days of refinancing auctions of adjustable rate mortgage (ARM) bonds today (Thursday), while BRFkredit and Nykredit have one day left, with “extreme” spread stability to slight tightening and curve flattening flagged as notable aspects of the sales.
Moody’s changed its outlook on the Danish banking system from negative to stable yesterday (Wednesday) because of a continuing stabilisation of the operating environment and reduced risks for Danish financial institutions, with covered bond developments seen as key.
Danske Bank sold a Skr5bn (Eu546m, Dkr4.08bn) April 2018 floating rate covered bond backed by Swedish and Norwegian residential and commercial mortgages yesterday (Wednesday), which was the Danish bank’s first covered bond issue in Swedish kronor in more than two years.
Nykredit Realkredit will kick off Danish mortgage credit institutions’ October refinancing auctions on Monday, for which BRFkredit and DLR Kredit today (Thursday) announced expected supply figures, with analysts noting a shift away from one year ARM bonds.
Jyske Bank priced a well-received Eu500m (Dkr3.73bn) three year senior unsecured FRN in a rare visit to the euro benchmark market yesterday (Wednesday), with the deal also its first public euro issue since the Danish bank’s merger with BRFkredit in April.
Danske Bank priced its first euro covered bond in over a year on Tuesday, a Eu1bn seven year deal whose pricing illustrates the outperformance of Danish issues in the Nordic market, according to a lead syndicate banker.
Nykredit sold some Dkr13bn (Eu1.74bn) of one year ARM bonds this week in the first auctions of covered bonds that feature maturity extension triggers in accordance with new legislation, and market participants said the auctions, although small, show demand to be largely unaffected by the changes.