Nordea attracted £425m of orders for a £400m (Eu545m) three year FRN today (Wednesday), which bankers said shows sterling to be an attractive option for issuers. Meanwhile, ABN Amro, DNB and Bank of Montreal are expected to hit the euro market tomorrow after mandating new deals.

Nordea Eiendomskreditt announced the mandate for its new issue yesterday (Tuesday), when Lloyds opened the sterling market with a £750m three year FRN that attracted £850m of orders.

Leads Barclays, Nordea, RBC, RBS launched Nordea’s three year floater with IPTs of the 42bp over three month Libor area, before maintaining that level for guidance and then fixing the spread at 42bp on the back of £425m of orders. The size was then set at £400m, with the book closing in excess of £425m.

“We got a good response and found good traction, and we’re happy with that,” said a syndicate official at one of the leads.

The deal is the second benchmark sterling covered bond from Nordea Eiendomskreditt, the Nordea group’s Norwegian subsidiary. The issuer made its debut with a £500m three year FRN in September 2014.

A syndicate official away from the leads said it is difficult to calculate fair value for Nordea’s new issue due to a lack of comparable Norwegian sterling paper outstanding.

“The issuer is not Nordea per se, and it is difficult to compare this to issuers like Danske or the UK names,” he said. “However, at 42bp this has come with a premium to Lloyds’ deal yesterday, which makes sense given the credit differential.”

Lloyds leads Barclays, HSBC, Lloyds and RBC yesterday priced the UK issuer’s £750m three year FRN at 37bp over three month Libor, after having announced the deal with IPTs of the high 30s.

“That deal went very well, and I think alongside Nordea it shows sterling remains a good option with good arbitrage to be had,” said the syndicate official.

Banks and private banks bought 69% of the Lloyds deal, asset managers 25%, central banks and official institutions 3%, pension funds and insurance companies 2%, and others 1%. Accounts from the UK and Ireland took 71%, France 17%, Asia 8%, Switzerland 2%, Germany 1%, and southern Europe 1%.

Heavy supply is expected in euros tomorrow (Thursday), after three banks announced deals today, and with Germany and some other European countries returning after marking a public holiday today.

DNB Boligkredit and Bank of Montreal each announced mandates for five year issues. DNB’s leads are Crédit Agricole, Deutsche, LBBW and UBS, while the Canadian issuer has mandated BMO, Credit Suisse, Commerzbank and HSBC.

ABN Amro announced a mandate for a 10 year issue, with leads ABN Amro, Barclays, BNP Paribas, Santander and UniCredit.

“It certainly looks like it’s going to be a busy one, and Thursday seems a good window,” said a syndicate official.