Caisse Française de Financement Local, the entity succeeding Dexia Municipal Agency following its sale to a new French state-owned municipal lender, is planning to start issuing covered bonds in the second quarter of this year.

The intention is for CFFL to issue Eu3bn-Eu5bn of covered bonds in 2013, Philippe Mills, chief executive officer of Société de Financement Local (SFIL), the holding company of CFFL, indicated yesterday (Wednesday).

Like its predecessor Dexia Municipal Agency, CFFL is a société de crédit foncier and will issue obligations foncières backed by public sector assets.

Covered bonds issued by CFFL have been upgraded to or confirmed at triple-A by Fitch, Moody’s and Standard & Poor’s since the transfer of CFFL’s ownership from Dexia Crédit Local to SFIL was finalised on 31 January.