Aktia Real Estate Mortgage Bank found execution smoother for a five year benchmark yesterday (Wednesday) than fellow Finn Sampo Housing Loan Bank had for a 10 year on Tuesday, and an Aktia official told The Covered Bond Report that demand had exceeded its expectations.

Leads Crédit Agricole, JP Morgan, Nykredit and UniCredit built a book in excess of Eu1bn for Aktia’s Eu600m five year trade and priced it at 50bp over mid-swaps, the tight end of guidance, yesterday (Wednesday), in spite of market conditions becoming tougher.

“Aktia was a huge success,” said Timo Ruotsalainen, head of credit control at Aktia. “It was a lot more widely appreciated than I had expected, particularly with the deals we’ve seen recently.”

Sampo was in the market on Tuesday with a Eu1bn 10 year deal that was priced at 57bp over, the wide end of 55bp-57bp guidance, and for which order books grew only steadily to Eu1.1bn.

“What Sampo issued – a 10 year – was a bit more challenging, with yields the way they are,” said Ruotsalainen.

He felt that Aktia had settled on the correct maturity.

“Our five year maturity was a bull’s-eye,” he said. “We chose that maturity because it adds to the curve we already have, and because when we went on roadshow investors seemed to agree the five year made the most sense.

“We also wanted to get out before the summer holidays,” he added, “which start a month earlier in Finland than in most of Europe.”

The size of the issue was increased from an original Eu500m to Eu600m because of a high quality order book.

“We realised a lot of people would be unhappy and it was unfair to cut the bids in half,” said Ruotsalainen, “so we needed to discuss increasing the size internally because we had said Eu500m originally.

“It was much more international than what we have experienced in the past,” he added. “We last issued a three year, in November, where we gathered Eu800m on a Eu500m trade. That’s more what we’re used to seeing.”