Four new benchmarks today (Thursday), taking supply since Monday to 14 deals, made it one of the busiest ever weeks in covered bonds, with Caffil launching the year’s longest, BMO the largest, Cajamar the widest, and KBC a deal that impressed bankers with its tight level.

Today’s issuance took euro benchmark supply this week to Eu11.75bn.

The deals for Bank of Montreal and KBC Bank were seen as paying only relatively limited new issue premiums, prompting a syndicate official to describe the market as having returned to a similar situation as late last year, when new issue premiums were similarly limited.

“It seems that the bigger new issue premiums we have been seeing are water under the bridge now and that people are willing to buy flat to the bid side again,” he added. “It is clear evidence that there is still far too much money around and people are desperate to put this money to work.”

Another banker said that, in contrast to the last deals of 2014, oversubscription levels are healthy, even with Eurosystem participation being more limited and without orders being inflated.

“That instils confidence in me and I think the market, too,” he said.

KBC’s new issue was the first Belgian benchmark of the year, a Eu1bn seven year transaction that attracted more than Eu1.5bn of demand despite coming at what bankers away from the leads described as a tight level of 2bp over-mid-swaps. One said that he had expected the floor for the deal to be 3bp over.

“It was a fantastic result,” he said, “and on top of that they were able to do Eu1bn, which is a nice size.”

The re-offer of 2bp over came after initial price thoughts of the mid-single-digits, which was revised to guidance of the 3bp area after orders exceeded Eu1bn, according to a syndicate official at one of leads HSBC, ING, KBC, LBBW and UniCredit. He said that the final spread represented a new issue premium of around 3bp, with fair value seen at less 2bp or 1bp.

“I haven’t seen a book yet this year of such high quality,” he added, noting central bank participation away from the Eurosystem.

Bank of Montreal sold a Eu1.5bn five year issue that is the biggest covered bond benchmark of the year. Leads Barclays, BMO, Commerzbank and HSBC priced what was also the first Canadian euro benchmark of the year at 6bp over mid-swaps, after having gone out with IPTs of the 10bp area and built a book of some Eu2bn.

A syndicate banker away from the lead said the deal had gone well even though pricing was close to flat to the bid side of Canadian issuance. Another said that he felt it could have come even tighter, with the IPTs having been unnecessarily wide, but that he had no problem with issuers being generous, particularly with spreads still tight and, as in BMO’s case, when the issuer is looking at a big size.

National Bank of Canada was marketing a possible new issue in Europe this week after having last week announced a mandate for a roadshow with BNP Paribas, Commerzbank, HSBC, NBC and RBS.

A 20 year deal for Caisse Française de Financement Local (Caffil) is the longest-dated covered bond benchmark to have been launched in 2015. Leads Barclays, JP Morgan, LBBW and Natixis skipped IPTs and went straight to guidance of the 20bp area before pricing the new issue at 19bp over.

A syndicate official at one of the leads said that the issue had been planned for some time but that “in this environment you need to catch the market at exactly the right time with a 20 year”. He noted that French government bonds had performed well lately, allowing the new issue to offer a decent level against OATs.

“It is clearly targeted at duration seekers and yield seekers in this low rate environment,” he said, “with insurance companies and pension funds very keen on being able to buy something like this at the beginning of the year when they are cash rich.”

A Eu750m seven year deal for Cajamar (Cajas Rurales Unidas) today came with the widest spread of any benchmark covered bond so far this year, 90bp over mid-swaps. Leads Barclays, BBVA, Crédit Agricole and Société Générale went out with IPTs of the 95bp area, then guidance of 90bp-95bp, before fixing the spread at 90bp over on the back of a Eu1.3bn book.

A syndicate official away from the leads described the outcome as a decent result. He said that it had potentially been helped by a decision by the Swiss National Bank to dispense with its Swiss franc cap this morning, in that the move was seen by some observers as another step towards sovereign QE in the Eurozone, which in turn should help higher beta names like Cajamar rally.

Another covered bond banker said that there was otherwise no direct impact from the SNB’s move.

“It just goes to show that you cannot forever postpone what is economically necessary,” he added.