Møre Boligkreditt is preparing to issue a debut public euro covered bond, having today (Monday) announced a roadshow for next week ahead of a Eu250m five year issue, and is targeting the currency in order to diversify its investor base, according to managing director Ole Andre Kjerstad.

Møre Boligkreditt, a subsidiary of Norwegian savings bank Sparebanken Møre, has issued covered bonds since being established in 2009, mostly domestic Norwegian krone bonds, and in euros has only two private placements outstanding.

The Norwegian issuer announced this morning that it has mandated LBBW and Nordea to arrange a series of European investor meetings ahead of a potential Eu250m no-grow five year covered bond that would be its first public euro issue.

The roadshow will commence next Monday and is set to conclude on Wednesday of next week (24 May), and will visit Helsinki, Copenhagen, Stuttgart, Frankfurt, Cologne and Dusseldorf.

Ole Andre Kjerstad, managing director at Møre Boligkreditt, told The Covered Bond Report that the issuer wants to join the euro market to diversify its investor base.

“The reason we want to explore the euro market is that it is a very liquid market, where investor depth is very good,” he said. “We are looking to expand our investor base, and we think entering the euro market is the best way for us to achieve that.”

Kjerstad said he does not expect Møre Boligkreditt to issue euro benchmark-sized deals in the near future.

“We are looking at Eu250m in this deal, and probably also going forward,” he said. “Size-wise, this is where we are in the domestic market, and it is also what we will be trying to achieve in the euro market.”

Møre Boligkreditt’s covered bonds are rated Aaa by Moody’s, and parent Sparebanken Møre is rated A2. The issuer said its euro debut will be LCR Level 2A-eligible and is intended to be ECB repo-eligible.

Kjerstad noted that Møre Boligkreditt has to date sold five Norwegian krone-denominated covered bonds that are eligible for LCR Level 2A, all Nkr2.5bn issues.

As of 31 March, Møre Boligkreditt had Nkr16.5bn (Eu1.76bn) equivalent covered bonds outstanding, and a cover pool of Nkr18.9bn. Its two euro private placements total just Eu55m, comprising a Eu25m 2028 fixed rate note and a Eu30m 2020 floating rate note.