La Banque Postale intends to establish a covered bond issuing entity to refinance home loans, while Crédit Agricole has set up a société de credit foncier for the issuance of covered bonds secured on loans backed by export credit agencies.

France’s Autorité de Contrôle Prudential (ACP), has licensed Crédit Agricole Export Credit Agencies SCF, according to ACP’s website.

The Covered Bond Report understands that the issuer had been working on setting up such an entity for a few months, with the issuer having available a stock of high quality assets eligible for an SCF that are not eligible for a société de financement de l’habitat given that the latter is focused on French home loans.

The Covered Bond Report understands that the project is well advanced and that the issuer expects to present the programme publicly sooner rather than later.

Crédit Agricole issues mortgage backed covered bonds off a Home Loan SFH programme, which replaces a Crédit Agricole Covered Bonds structured covered bond programme.

Export credit agencies are public sector entities that provide guarantees to export loans granted by banks, with this type of asset already present in cover pools for BNP Paribas and Société Générale SCFs, although The Covered Bond Report understands that export credit agency-guaranteed loans are likely to form a greater part, if not all, of Crédit Agricole’s SCF cover pool.

A syndicate banker away from Crédit Agricole said that some Spanish banks have also been looking into covered bonds backed by such assets.

“To do it as a very established issuer is one thing,” he said, “but as a less established issuer it’s a very different matter. It’s not a walk in the park.”

He added that in Crédit Agricole’s case it is very clear how the bank obtains its mortgage funding, there is transparency on its senior unsecured curve, and it has been the most active issuer of mortgage covered bonds this year, suggesting that these aspects would provide for clarity when it comes to extrapolating pricing levels for its new programme.

La Banque Postale’s plans were announced in a press release last Wednesday (19 October), which states that the bank, as part of the its strategic plan for 2011-2015, wishes to develop its home loan offering for retail clients and that it also envisages creating a société de financement de l’habitat (SFH) exclusively for the refinancing of such loans.

With respect to the financing of loans to local authorities, the statement continues, La Banque Postale is not working on the establishment of a société de credit foncier (SCF) and is considering using, in the context of ongoing negotiations, the public sector lending structure of Dexia Municipal Agency, which Caisse des Dépôts et Consignations (CDC) will control and in which La Banque Postale will have a 5% stake.

The press release does not appear to have been widely circulated, as it is not on the bank’s website, and a spokesperson in the press office told The Covered Bond Report that it was only produced to respond to false rumours that La Banque Postale was working on setting up a covered bond issuing entity for public sector lending, and that this was linked to the change of ownership of Dexia MA.

A société de financement de l’habitat is a covered bond issuing entity created under new legislation passed in France last year, with the debt issued known as obligations de financement à l’habitat or obligations à l’habitat. They are a third type of legislative covered bond issued out of France, alongside obligations foncières and covered bonds issued by Caisse de Refinancement de l’Habitat (CRH), and were designed to supersede previous issuance of structured mortgage backed covered bonds.

Dexia on Thursday announced the terms of a negotiation agreement between Dexia, CDC and La Banque Postale on the ownership of Dexia MA, which contains two features. One is the acquisition by CDC and La Banque Postale of respectively 65% and 5% of the shares in Dexia MA, and the second is a joint venture between CDC and La Banque Postale dedicated to originating loans to French local authorities, refinanced through Dexia MA.