Moody’s upgraded covered bonds issued by Bank of Ireland Mortgage Bank from A3 to A1 yesterday (Wednesday), after having raised the deposit rating of the Irish bank from Ba2 to Baa3 on Tuesday.

The covered bond anchor for Bank of Ireland’s programme is the deposit rating plus zero notches under Moody’s methodology, and the programme is assigned a Timely Payment Indicator (TPI) of “probable”.

The rating agency noted that the TPI Leeway for the programme is zero notches, meaning that a downgrade of the covered bond anchor could lead to a downgrade of the covered bonds.

The minimum overcollateralisation consistent with the A1 rating is 6% on a Prudent Market Value basis, according to Moody’s, with OC in the cover pool currently 38.2% on a nominal basis and 13.5% on a PMV basis, and the issuer providing 5% on a “committed” basis.