Syndicate officials were this (Monday) morning expecting a quiet week ahead, with no primary market activity today despite the covered bond market being relatively unaffected by weaker peripheral sovereign and equity markets.

No new benchmark covered bonds were announced and bankers said that there is nothing in the pipeline for this week, and that there are no indications that any issuer is even considering anything.

“Maybe we’ll be surprised,” added one, “because the covered bond market is in good shape from my perspective. It would also be perfect timing, in the sense that there would be no competing supply.”

Speculation about a restructuring of Greek sovereign debt was weighing on peripheral sovereign and equity markets, which were down.

“It’s a pretty weak market at the moment,” said a syndicate official. “All these rumours are circulating about Greece and that’s fuelled an already weak market.

“Bund futures have risen about 30 ticks,” he added.

But covered bond bankers said that they saw no reason why an issuer from a less volatile sovereign should not come to market in the next couple of days, before what is a long weekend in many countries.

“We have had this speculation about sovereign problems with the periphery over the last month,” said one. “But it won’t harm an issuer from France, Germany or the Nordics. It wouldn’t be a hurdle for someone from the core markets.

“Of course, it might be an issue for the Portuguese, Greeks or Spanish.”

Bankers also said that the heavy supply so far this year also contributed to the lower likelihood of issuance this week.

“There was a bit of a rush ahead of the Easter and other holidays, too,” added one.