SpareBank 1 Boligkreditt sold its first 10 year euro benchmark on Tuesday, with the possibility of offering a positive yield at the long end a factor, according to the issuer’s COO, who said erroneous reports on its substitute assets did not affect the Eu1bn deal’s successful outcome.
Norway’s SpareBank 1 Boligkreditt sold a Eu1bn seven year covered bond on Wednesday that was described as “textbook” into a busy euro covered bond market where eight issues totalling Eu6bn were launched this week.
SpareBank 1 Boligkreditt amassed a book of over Eu1.7bn for a Eu1.5bn three year covered bond yesterday (Thursday) that bankers said showed strong demand for shorter dated paper, with the Norwegian deal standing out amid a slew of five to seven year supply as the equal-largest three year of 2015.
Danske Bank launched a Eu1bn (Dkr7.5bn) five year covered bond on Tuesday amid a wave of supply that the market proved more than able to absorb, and further benchmarks are due early next week.
SR-Boligkreditt issued its first covered bond yesterday (Thursday), a Nkr2bn (Eu229m) five year deal that an official at the issuer said represented a decent start to its issuance, even if the pricing was marginally wider than expected amid a volatile market.
Members of the SpareBank 1 alliance in Norway are setting up their own covered bond issuers as a back-up to SpareBank 1 Boligkreditt (SpaBol) because of large exposure limit regulation.
SpareBank 1 SMN sold its second euro fixed rate senior unsecured benchmark on Tuesday, a Eu500m no-grow five year issue that was priced 35bp tighter than its debut last year and, according to an official at the Norwegian bank, came with a narrower spread differential to its peers.
Demand for a Eu1bn long six year SpareBank 1 covered bond fell short of expectations on Tuesday, and an official at the issuer said the outcome was surprising, with the choice of maturity and amount of recent Nordic supply perhaps explaining the subdued reception.
Norway’s SpareBank 1 alliance has strengthened liquidity and capital support of its commercial mortgage covered bond issuer, SpareBank 1 Næringskreditt, in a move recognised by Moody’s and which the issuer hopes could yield pricing benefits.
Norway’s SpareBank 1 Boligkreditt was one of four issuers to launch benchmark euro covered bonds this week despite market conditions remaining tricky after the recent turn in sentiment, while Aktia Bank has embarked upon a roadshow ahead of a debut in its new guise.