The Swedish Covered Bond Corporation will hold a roadshow in Australia next week for a new Australian MTN programme, Per Tunestam, treasurer at SCBC parent SBAB, told The Covered Bond Report.

“We thought the Australian dollar covered bond market would suit us given the small size of our balance sheet and the small size of the Australian dollar market,” he said. “It’s a smaller market than the 144A.”

Tunestam drew a comparison with the Swiss franc market, where SBAB or SCBC issues four or five public senior unsecured or covered bond deals a year, raising Sfr125m-Sfr250m (Eu101.2m-Eu202m) per deal.

Tunestam confirmed the issuer intends to launch a deal – if not by year-end, then in the first quarter of 2012.

“It depends on the feedback we receive on the roadshow from investors,” he said.

Tunestam said it was too early to identify a size or maturity, but he expected the first transaction would be in the region of A$500m. He stressed no decision had yet been made.

He said that Australian investors might be more interested in covered bonds now that Australian banks are active in the asset class.

“I understand that interest has risen as a result of Australian issuers,” he said, “as well as the Australian Prudential Regulation Authority now legitimising the market by introducing regulations.

“I think the US also needs this to make their market better,” he added.

Tunestam said even the whole documentation process had been smoother and less cumbersome than what he understand to be the case with 144A.

Moody’s and Standard and Poor’s have rated SCBC’s programme triple-A.

“We’re positively looking forward to entering a new market,” he said, “and I hope that we’re met with good demand from investors.”