A five year issue for DnB Nor was the more popular of two deals from non-euro-zone issuers in the market today (Tuesday), with a Credit Suisse seven year deal nevertheless deemed to have achieved a “respectable” outcome by a banker away from the leads.

A syndicate official away from today’s deals said that it was “slightly humorous” to note that of the last four euro benchmark covered bonds to have hit the market only one has been for a euro-zone issuer, despite anticipation and then confirmation of a second covered bond purchase programme (CBPP2) by the European Central Bank.

The UK’s Nationwide Building Society sold a Eu1.5bn five year deal last Thursday, before CBPP2 was announced later in the day, with a Eu1.4bn 12 year issue for France’s Caisse de Refinancement de l’Habitat priced yesterday (Monday) the only euro-zone deal to have been launched so far.

Syndicate officials said that market conditions were conducive to issuance and that issuers should take advantage of this rather than wait for the start of CBPP2, in November. However, one noted that issuers will soon be entering blackout periods as the earnings season begins.

The Co-operative Bank today announced that it has mandated Barclays Capital, HSBC, JP Morgan, Royal Bank of Scotland and UBS to carry out investor meetings ahead of a possible covered bond transaction. The meetings are due to start on Monday, 24 October.

DnB Nor Boligkreditt has fixed the spread for its five year deal at 58bp over and could size it at Eu2bn. More than Eu2.5bn of orders were placed, according to a syndicate official at one of the leads – BNP Paribas, Barclays Capital, Deutsche Bank, and Goldman Sachs.

The issuer announced the mandate for the benchmark yesterday afternoon, and this morning went out with guidance of the 60bp over mid-swaps area, which was later revised to 58bp-60bp.

Syndicate officials away from the leads said the pricing for DnB Nor’s issue was fair, with a couple having yesterday (Monday) said that the 60bp over area seemed appropriate, and another today saying that the level offered a “reasonable” new issue premium.

One put the new issue premium at 8bp, and said that this was “relatively generous” given the high quality of DnB Nor’s covered bonds and the liquidity available in the five year part of the curve. He said he expected the deal to be priced inside 60bp over.

A syndicate banker away from the deal said it was a good trade, and that the strategy of going out with the 60bp over area as guidance made sense. However, he said that he had priced the deal somewhat tighter.

An origination official said that DnB Nor’s issue was marketed at a “cheap” level, and that he would have put the level at the mid to high 40s. Investors should “grab” the bonds if they could, he said, adding that he expected them to perform.

DnB Nor last tapped the benchmark euro market in early June, selling a Eu1.5bn 10 year at 53bp over.

Credit Suisse is pricing a Eu1.25bn seven year benchmark at 62bp over mid-swaps via leads ABN Amro, Bayerische Landesbank, Banco Bilbao Vizcaya Argentaria, Credit Suisse, Natixis and UniCredit.

The re-offer spread follows guidance of the low 60s, with “well over” Eu1.25bn of orders from more than 90 accounts having been placed, according to a syndicate official at one of the leads. The order books were due to be closed at 1300 CET.

The syndicate official said that he was impressed by how well the transaction had gone, and by the quality of the order book, which included “the main German buyers, good Dutch interest, some Swiss interest and some Asian interest”.

The deal was marketed as a benchmark to give the issuer flexibility on size, although it was targeting a Eu1bn size, he said.

The deal is Credit Suisse’s second euro benchmark, after it made its debut in December 2010 with a Eu1.25bn five year issue. It sold its first US dollar covered bond in May 2011, a Eu1bn five year that the syndicate banker said was priced flat to slightly wide of Nordic dollar covered bonds, a comparison he took up in relation to today’s deals.

“We are pricing roughly 10bp through the best Nordic name,” he said, comparing pricing of 62bp over for a seven year Credit Suisse issue with the spread on offer for DnB Nor’s five year trade, and estimating the extension from the five to seven year part of the curve, depending on the issuer, at between 12bp and 15bp.

A syndicate official away from the leads said that the size of the order books indicated the deal was not a “blowout”, but that it was “respectable”, adding that the seven year maturity can be a challenging sell.

Another syndicate banker away from the leads said that he was surprised at the “wide” new issue premium, which he put at around 15bp. He acknowledged that this was in line with several other transactions that had come to market, but compared it with what he said was a new issue concession of around 4bp for a Eu1bn April 2015 deal for fellow Swiss issuer UBS at the end of August.

The syndicate official on the Credit Suisse deal suggested the comparison did not hold because the prevailing market was “completely different” to conditions and that the maturities were also not comparable.

Another syndicate official away from the leads said that it was difficult to calculate the new issue premium for Credit Suisse because it only has a 2015 outstanding in euros, but he put it at 10bp-12bp. He said the low 60s over seemed fair, noting that secondary levels for Credit Suisse were very tight.