BMO is set to launch a seven year euro covered bond tomorrow (Thursday), joining a well-stocked pipeline including debuts from BNP Paribas Fortis and PKO, although the latter is likely to wait until next week. An awaited euro first for DBS is, however, not expected this month.

Although a number of issuers have announced mandate for euro benchmark covered bonds since the start of the fourth quarter, issuance has been relatively modest this month, with just Eu2.5bn of supply so far and a Eu500m seven year cédulas for Ibercaja on Monday the only deal to be brought to market this week.

“There are quite a few projects on the go and the pipeline is fairly filled,” said a syndicate banker, “but that is not translating into a busy primary market.

“Rather, the expected deals are quite spaced out, and besides UBI’s reopening (see separate article) and the BMO mandate, issuers have this week been focussed on the subordinated and capital themes.”

Bank of Montreal (BMO) announced the mandate for its seven year euro benchmark this (Wednesday) morning, with leads Barclays, BMO, Crédit Agricole and Deutsche. A syndicate banker at one of the leads said the deal will be launched tomorrow.

The last euro benchmark from Canada was a Eu750m (C$1.1bn) seven year issue for National Bank of Canada (NBC), which was priced at 2bp over mid-swaps on 22 September. Syndicate bankers at BMO’s leads saw the NBC September 2023s at 1.5bp, mid, and also cited as comparables BMO September 2022s at minus 2bp and Toronto-Dominion April 2023s at minus 0.5bp.

The deal will be BMO’s fourth benchmark covered bond of the year, following two Eu1.5bn issues – a three year in January and a five year in April – and a $1.5bn (C$1.99bn, Eu1.35bn) five year in June.

PKO Bank Hipoteczny will today conclude a roadshow ahead of a debut euro benchmark with a medium term maturity, although a syndicate banker at one of leads Deutsche, JP Morgan, LBBW, PKO Bank Polski and Société Générale expects the deal to be launched early next week.

“I’m not ruling out that we could come to the market quickly,” he said. “But it is more likely that we will use the rest of the week to collect feedback and hold further discussions.

“It is a new jurisdiction and a new issuer, so it is not one to rush.”

Dutch issuer SNS Bank is also holding investor meetings today and tomorrow (Thursday) ahead of a potential 15 year euro issue, which will be its first benchmark covered bond since 2012. A banker at one of leads ABN Amro, Commerzbank, Credit Suisse and SG said the deal will probably emerge next week.

BNP Paribas Fortis yesterday (Tuesday) completed European investor meetings ahead of a potential debut euro benchmark covered bond, which will have an intermediate to long maturity.

DBS Bank has been expected to sell its first euro benchmark covered bond since completing a European roadshow on 23 September. However, a banker at one of the mandated leads – Deutsche, JP Morgan, SG and UniCredit – told The Covered Bond Report that any deal will now not emerge until after the Singaporean bank exits a blackout period on 31 October, when it will report its third quarter results.