Spain’s Banco Mare Nostrum redeemed early Eu700m of cédulas hipotecarias yesterday (Tuesday), with the buyback aimed at improving the bank’s liquidity ratios and increasing overcollateralisation, according to Natixis analysts.

The early redemption was announced yesterday in a notice to Spain’s financial markets regulator. Natixis analysts said that the bonds in question were retained 3.36% December 2016 cédulas hipotecarias.

“As these cédulas were not used as collateral for repo purposes, the bank decided to buy back these bonds,” they said. “Thanks to this buyback, the issuer expects to improve its liquidity ratios and to increase its overcollateralisation ratio.”

Photo: Building of Caja Granada, one of the savings banks constituting Banco Mare Nostrum