UniCredit Bank Austria has mandated a Eu500m mortgage Pfandbrief for launch in the near future, while Finland’s Aktia is expected to tap the covered bond market next week and Germany’s Berlin Hyp is also a new issue candidate, according to bankers.

The Austrian issuer’s mandate was announced this (Friday) afternoon, with BayernLB, DZ, ING, Nykredit and UniCredit as leads for a Eu500m no-grow mortgage Pfandbrief. Launch and pricing was announced as being in the near future, subject to market conditions.

Aktia Bank went on a roadshow from 25 March until yesterday (Thursday) having mandated Commerzbank, JP Morgan, LBBW and Nordea Markets as leads. A syndicate banker on the deal today said that the deal is pencilled in for launch in the first half of next week.

Berlin Hyp announced on Monday that it has mandated Commerzbank, Credit Suisse, DZ Bank, JP Morgan and LBBW to organise a series of investor meetings in the lead-up to a euro benchmark deal. Syndicate bankers at and away from the leads said they expect a deal late next week. The issuer’s mortgage Pfandbriefe were upgraded by Moody’s from Aa1 to Aaa today. (See separate article here.)

Banco Popular Español, BayernLB, NIBC and UniCredit Bank got April off to a strong start, issuing euro benchmark deals over the course of Tuesday and Wednesday, but a syndicate banker said he believes issuance will begin to slow over the coming quarter, despite investor appetite and conducive conditions.

“A lot of issuers have accessed the market and as such do not need to issue,” he said, “so they will likely wait until the second half of the year before they return.”

Another syndicate official noted that FIG flow volumes were down this week on last week, with Eu4.75bn worth of deals compared with Eu7bn last week, but that supply should pick up next week.

“A couple of issuers are lined up to issue covered,” he said. “The rest of the market might wait to see how things go post today’s non-farm number and to the start of the week.”

However, he noted that market conditions looked good at today’s open, with credit indices tighter, and contingent capital, peripheral senior unsecured and recent covered bonds having performed well so far this week.

There was Eu10bn more euro benchmark issuance in the first quarter of this year compared with the same period in 2013. Another syndicate banker attributed this to “a natural bounce” following a poor year and several new entries to the market.

“The return of Canadian issuers to the euro benchmark market has helped drive things along, and continued the growth of the asset class,” he said. “We are well above issuance compared with where we were last year, and issuers have been able to get away with tight levels so everybody who could be looking, should be looking.”

Issuance this week was front-loaded, with a UniCredit Eu500m no-grow 10 year covered bond on Wednesday the last of four deals that were priced over two consecutive days, before an ECB Governing Council meeting yesterday and US non-farm payrolls today.

Leads Commerzbank, Crédit Agricole, DZ Bank, JP Morgan, and UniCredit built a book of more than Eu1.1bn for UniCredit’s deal. Initial price thoughts were in the mid-teens for the mortgage-backed Pfandbrief, before official guidance was set at 13bp over. The spread was tightened and fixed at 12bp over. A syndicate official at one of the leads today said that the deal was trading at around the re-offer spread.

Seventy-five accounts were involved in the order book to make for a “very good” level of granularity, according to another lead syndicate banker. The decision to go ahead with the deal followed positive investor feedback gleaned from a series of meetings conducted in the weeks preceding the deal, he added.

Germany was allocated 72%, the Benelux 7%, Asia 6%, Austria and Switzerland 6%, the UK and Ireland 5%, Italy 3%, and France 1%. Banks took 74%, fund managers 14%, central banks 7%, insurance companies 3%, and corporates 2%.