Covered bond supply next week be focussed in the seven to 15 year part of the curve, bankers expect, with the five year maturity out of vogue amid falling yields and after a “star” Eu2.25bn 15 year issue for ABN Amro. VakifBank is meanwhile roadshowing for a potential Turkish first.

Five euro-denominated covered bonds were sold this week, totalling Eu5.75bn, and syndicate officials noted that each was comfortably subscribed even though market sentiment remained uncertain.

“It’s been a strong week in covereds, and clearly the market is wide open,” said a syndicate official. “Even on days where risk sentiment has been weaker, the covered bond market has been unmoved.

“Wednesday was one of the softer days and ABN were able to print a Eu2.25bn deal.”

Of the five deals, only one, from a non-core issuer, was a five year– a Eu500m issue for New Zealand’s ASB Finance – while Lloyds and LF Hypotek sold seven year issues and Caffil a 10 year. On Thursday, ABN Amro then attracted over Eu3bn of demand for its Eu2.25bn 15 year issue – the largest single tranche covered bond since January 2012.

“ABN is one of the star covered trades of the year so far,” said a syndicate official away from the leads.

The Dutch issuer’s deal was only the second benchmark issue with a maturity of 10 year or longer since January, with most recent deals having been focussed in the seven year maturity, and, before that, in the five year maturity.

Bankers said the deal, along with Caffil’s twice oversubscribed Eu1.25bn 10 year on Tuesday, demonstrated increasing depth in the longer end of the market.

“People are looking for duration and looking for yield,” said a syndicate official. “What’s notable is that some of the bank treasuries and even asset managers that had previously been more focussed on the five to seven year maturities have been pushing out and looking at the 10 and 15 year part of the curve.”

Central banks and official institutions were allocated 36% of ABN Amro’s deal, insurance companies and pension funds 30%, banks and private banks 19%, and asset managers 15%. Accounts from Germany and Austria took 48%, the Netherlands 30%, southern Europe 5%, the Middle East 4%, France 4%, the Nordics 3%, the UK 3%, and others 3%.

Bankers said issuers are likely to be eyeing deals in the seven to 15 year part of the curve after this week’s successes.

“With yields falling further this week I think five years might go a bit out of vogue, after being the deal of choice when things were trickier, and I would expect both issuers and investors to be pushing out to deals of seven years or longer,” said one.

They added that the pace of supply will remain consistent next week, with around five or six benchmarks expected.

“Next week is a clear window, with no central bank meetings or data points that you’d expect to derail sentiment,” said one. “It looks like a good time to do business.”

Türkiye Vakiflar Bankasi (VakifBank) yesterday (Thursday) announced a mandate for a series of investor meetings across Europe, commencing on Tuesday (12 April), ahead of a potential debut euro-denominated covered bond.

The roadshow will visit Vienna, Munich, Frankfurt, London and Paris, concluding next Friday (15 April). Barclays, BNP Paribas, Erste, Natixis and UniCredit have the mandate.

The deal is expected to be the first euro-denominated mortgage backed Turkish covered bond.

Turkish banks have previously issued SME-backed covered bonds, with first having been from Şekerbank in July 2011, which have only been privately placed internationally. Akbank sold the first mortgage-backed Turkish covered bond, in February 2015, a TL407.31m (Eu126m) five year deal that was placed with the European Investment Bank (EIB).

VakifBank’s planned issue is expected to be of benchmark size and have a five year maturity, according to a syndicate official at one of the leads.

“But this is not set in stone,” he added.

The deal is expected to be rated A3 by Moody’s.