Deutsche Pfandbriefbank will price its second sterling covered bond in six months today (Wednesday), a £200m three year FRN that a lead syndicate banker said offered a pick-up over recent German sterling trades to attract investors’ attention to what is a relatively new issuer in the currency.

The trade was announced on Friday afternoon, and leads BNP Paribas, Credit Suisse and RBS today garnered enough demand for the deal to be “very decently covered”, according to a banker at one of the leads.

“It’s working well,” he said.

The FRN will be priced at 50bp over three month Libor, in line with guidance of the 50bp over area. The re-offer margin is the widest on a floating rate covered bond in sterling this year.

The deal is the fourth German Pfandbrief in sterling this year, after FRNs for BayernLB, Münchener Hypothekenbank, and Aareal Bank, in that order. The latter two were each for £200m, and priced at 23bp and 40bp over, respectively. These were said to be trading at around re-offer.

A lead syndicate official on pbb’s deal said that the issuer, similar to MüHyp and Aareal, paid up versus euros, and that the sterling level reflected differentials between the issuers in euros.

“There is no one outside the euro market who says Pfandbrief levels can be exported to other markets,” he said.

According to another lead syndicate banker, pbb’s deal also offered a bit of a new issue premium.

“A pick-up over comparables and outstandings was offered because pbb is a relatively new issuer in the sterling market and it helped in attracting investors’ attention,” he said.

The lead syndicate banker said pbb has sold only one other sterling covered bond in recent times, a £250m seven year fixed rate covered bond at 90bp over Gilts in November last year.