Nordea Mortgage Bank, a new Finnish issuing entity established following a demerger of Nordea Bank Finland, is looking into possibilities in the euro market and could launch its first euro covered bond in the fourth quarter of 2016, according to an official at Nordea.
Stadshypotek issued its first covered bond out of a Finnish cover pool today (Tuesday), selling a thrice-subscribed Eu500m 10 year issue that progressed smoothly, in contrast with more turbulent conditions in other markets, with NordLB pulling a senior trade amid pressure on European banks.
New caps on LTV ratios that took effect in Finland last week are credit positive for Finnish covered bonds, according to Moody’s, reducing credit risk at the whole-loan level and adding to protections in the Finnish covered bond framework.
Bonum Bank issued its first public deal this week, a €100m three year FRN that will provide the basis for the future wholesale funding plans of the Finnish POP Bank Group, according to the issuer’s head of treasury, who said Bonum may target €250m issues in future.
The Mortgage Society of Finland sold a debut, €250m five year covered bond on Monday, with demand of €850m surpassing expectations after the book built rapidly, according to the issuer’s head of funding. Fellow Finnish issuer OP sold a “blowout” €1.25bn seven year issue on Tuesday.
Stadshypotek looks set to issue covered bonds backed by a dedicated Finnish residential mortgage cover pool under Swedish legislation, after Moody’s yesterday (Thursday) announced a provisional Aaa rating for such covered bonds, with issuance off a Danish pool also a possibility.
The Mortgage Society of Finland is set to launch a debut, Eu250m covered bond from a new programme within the next three months and aims to become a frequent issuer, according to an official at the Finnish credit institution, after it received a preliminary AAA rating from S&P.
Nordea today (Friday) launched a consent solicitation in respect of covered bonds issued by Nordea Bank Finland, seeking approval for a new demerged entity, Nordea Hypoteksbank, to assume the role of issuer while the Finnish bank is converted into a branch of the Swedish parent.
Nordea is expected to establish a distinct Finnish covered bond issuer as part of a strategy whereby its Danish, Finnish and Norwegian banking subsidiaries will become branches of the Swedish parent, a move that will be put to the group’s annual general meeting next month.
The Central Bank of Savings Banks Finland sold its second public bond issue on Tuesday, choosing what proved to be a slim window of stability to print a €250m two year senior unsecured FRN that the bank’s head of treasury said will fund a mortgage bank the group is establishing.