ABN Amro enjoyed a twice oversubscribed order book this morning for a new benchmark Dutch covered bond, with Eu4bn in orders for a Eu2bn 10 year deal, benefitting from a lack of primary supply at the long end of the curve. Deutsche Bank is now in the market with a rare new issue.

Deutsche has mandated Commerzbank, Credit Agricole, Deutsche, ING and UniCredit as joint books for a new seven year mortgage Pfandbrief and the leads are understood to have just started taking indications of interest.

ABN Amro‘s pricing was tightened to 75bp from 77bp over mid-swaps area guidance, and the size was raised from a targeted Eu1.5bn. Syndicate officials away from the leads were impressed with the execution.

“A fantastic deal,” said one.

Another said that he was not surprised that investors had been so enthusiastic.

“For several days we have seen good demand for the long end from investors in core countries,” he said. “The problem is that some of the French issuers can’t do anything because they are awaiting SFH status or are in blackout, while the Germans and Nordics don’t do many long dated issues.

“So there has not been a lot of activity in the primary market, even if we have seen some in secondary.”

The deal is understood to have been soft-sounded at the 80bp over mid-swaps area, with some Eu2.5bn of orders in a shadow book. One banker described the pricing as “really fair, but not cheap”.

ABN Amro, BNP Paribas, LBBW, and Société Générale were lead managers.

Deutsche Hypothekenbank wrapped up a three year public sector backed benchmark yesterday with Eu1bn at 9bp over mid-swaps, following guidance of 7bp-9bp over.

“Some might say that 9bp was a little bit wide, but I think it was fair considering the market,” said a syndicate official at one of the leads. “It was a bit slow, but then Mondays generally are.

“It takes investors longer to act on Mondays because they spend time wrapping their heads around what happened on the weekend and then act based on that.”

Another lead syndicate official said that while most orders were good inside 9bp over, a small number of key accounts had held out for the wide end of guidance and that the issuer had taken an investor-friendly approach to ensure wide participation.

“This is clearly something that enjoys very strong domestic support,” he added, “but it is something that some non-Germans have difficulty buying at such spreads. We were not hugely oversubscribed because the investor base is therefore more limited.

The book totalled Eu1.2bn, comprising around 50 accounts. Germany took 78%, Asia 10%, France 4%, Italy 4%, Benelux 2% and others 2%. Banks were allocated 65%, central banks 10%, asset managers 23%, and others 2%.