CIBC priced a $2bn three year yesterday (Tuesday) following the success of a US targeted deal for Toronto Dominion Bank last week, while CM-CIC provided the first euro benchmark covered bond supply in nearly two weeks with a tap.

CIBC, HSBC, JP Morgan and RBS priced the Canadian deal, a 144A private placement, at 58.76bp over US Treasuries.

The deal was the issuer’s fourth dollar benchmark. A syndicate official at one of the leads said that the mandate was announced “first thing” yesterday given a more stable market backdrop and immediately attracted strong indications of interest.

The issue was priced at 28bp over mid-swaps, which the syndicate banker said represented a minimal new issue premium over secondary market levels.

More than $2bn orders were placed, with north American investors taking 74%, Europe 15%, Asia 10%, and others 1%. Banks were allocated 29%, funds 18%, central banks and official institutions 2%, insurance companies 1%, and others 50%.

French issuer Crédit Mutuel-CIC Home Loan SFH added Eu200m to a 4.375% March 2021 issue at 110bp over mid-swaps. The tap, led by Credit Suisse, Deutsche Bank and Natixis, takes the total amount outstanding to Eu1.85bn.

The transaction came after spreads for French covered bonds had come under severe pressure, with obligations foncières of Dexia Municipal Agency worst hit.

Achim Linsenmaier, head of covered bond syndicate at Deutsche Bank, said that the CM-CIC increase followed a request from several accounts for long dated high quality issues based on a yield target above 3.5%.

“In times of significant volatility, we quickly used this request to price a tap of the existing deal within only a couple of hours,” he said.

The final order book comprised more than 15 orders, according to Linsenmaier.

The increase was priced to yield 3.56%, creating a “win-win” situation for the issuer and investors, he said.

“It allows the issuer to lock in funding at competitive levels while it helps real money accounts achieve yield targets for their long term investments”, he said. “Particularly in times of significant market stress this deal sends a pretty strong signal.

“Even though it’s a small tap, it shows that the covered bond market continues to provide funding to issuers, whilst senior unsecured markets are shut for almost two-and-a-half months.”