Industry Moves

2A+ status and higher limit seen as likely LCR result from Commission

May 8th, 2014

The EC is steering toward keeping covered bonds as Level 2 assets for LCR purposes but allowing them to make up a larger share, according to sources, and an EC spokesperson said “talks are progressing well” about a solution addressing Danish concerns.

ESAs’ EMIR consult offers swaps hope for covered bond industry

Apr 17th, 2014
EBA offices in London

European Supervisory Authorities EBA, ESMA and EIOPA launched a consultation on draft Regulatory Technical Standards for EMIR on Monday, which they said provide some flexibility for covered bonds, with one source cautiously welcoming the proposals as “looking quite positive”.

ECBC pitches Label, A- covered LCR plan to EC

Apr 4th, 2014

CRR-compliant covered bonds rated at least A- should count toward liquidity buffers with the Covered Bond Label playing a role as a quality criterion under a new approach the European Covered Bond Council (ECBC) has suggested to the EC ahead of its final decision on LCRs.

Bankföreningen tightens amortisation guides

Mar 20th, 2014
Riksbank image

The Swedish Bankers’ Association is lowering guidance on the LTV threshold above which new mortgages need to be amortised from 75% to 70%, while Riksbank governor Stefan Ingves said there is a case for increasing the mortgage risk weight floor to 25%.

Norwegians most bearish in Nordic CFO survey

Mar 6th, 2014
Moodys logo

Norwegian chief financial officers proved more bearish than their peers in their responses to a variety of questions posed by Moody’s in a survey of 39 Nordic CFOs, with an increase in banking regulation highlighted as a key factor potentially constraining their institutions.

Jyske, BRF see ‘great match’, covered increase

Feb 27th, 2014

Jyske Bank and BRFkredit are planning to merge, they announced on Monday, in a move that will step up competition in the Danish banking industry, with the potential for steep growth in mortgage lending for the combined entity and a tightening of BRFkredit bond spreads among effects cited.

EC stresses EU-specific factors to raise Level 1 LCR hopes

Jan 16th, 2014
Press conference by Michel Barnier

The European Commission will take into account “features specific to the EU banking system and financial markets” in addition to European Banking Authority (EBA) reports and international standards when deciding on covered bonds’ status in the LCRs, according to an EC spokesperson.

EBA recommends against Level 1 for covered

Jan 9th, 2014
EBA image

The European Banking Authority (EBA) has excluded covered bonds from assets it has recommended should be eligible as extremely high quality liquid assets for Liquidity Coverage Ratio (LCR) purposes in a report to the European Commission.

Level 1 exclusion feared but ECBC says it’s not game over

Dec 5th, 2013
Helle Thorning-Schmidt_resized

Fears are mounting that covered bonds could fail to secure a position as Level 1 LCR assets after it emerged that the EBA’s Board of Supervisors is against such a recommendation. However, the ECBC and others have said that Level 1 inclusion remains a real possibility.

Danske ‘Trekroner’ Tier 2 shows depth of Nordic locals

Nov 28th, 2013

Danske Bank sold Dkr5.55bn (Eu744m, $1.01bn) equivalent of Tier 2 capital across five local Nordic currency transactions in fixed and floating rate format on Tuesday, which an official at the issuer said was an “impressive” size that reflected positively on the depth of its local markets.