New euro benchmarks are in the works and could emerge in the coming days, according to syndicate bankers, rousing the market after a slow start to the month. However, only longer term projects have surfaced so far, such as an Achmea debut confirmed today (Monday).

The last euro benchmark covered bond issue came almost two weeks ago, a Eu500m three year for Eurobank Ergasias on 24 October. The primary market has been dormant in the interim due to a combination of factors, such as issuers being in blackout periods, public holidays across Europe, and key central bank decisions.

At least a few potential euro benchmark issues are being discussed today, according to syndicate bankers, and some, if not all are expected to be launched this week.

“We are working on one project that could emerge as soon as tomorrow or could even be for next week, it is still early to say,” said a syndicate banker. “There are a couple more projects like this, so there will be at least some supply this week – it remains to be seen how much supply.”

However, all expected euro issues that have been publicly announced are set to come to the market next week, and some bankers doubted that this week will see substantial activity.

“Everybody expects this week to be more active than the last two weeks, if only because in the last two weeks we have had virtually nothing,” said another syndicate banker. “The pipeline is filling up, but so far only with longer term projects, so I wonder if some of these more bullish predictions for covered bond supply are made out of hope rather than knowledge.”

Achmea Bank announced this morning that it has mandated ABN Amro, Citi, Rabobank, SG and UniCredit to arrange a roadshow starting this Wednesday and ending on Wednesday of next week (15 November), after which an inaugural conditional pass-through (CPT) covered bond may follow.

As reported on Friday, the Dutch bank revealed plans to enter the market in the coming weeks after establishing its new Eu5bn CPT programme. Achmea has previously issued covered bonds off an older programme that was not registered with the Dutch central bank, but all issuance off this programme has matured and the new programme is DNB-registered and, unlike the former, is eligible for preferential regulatory treatment under UCITS and CRD/CRR requirements.

Deutsche Hypothekenbank is the only issuer with a publicly announced euro benchmark in the pipeline, an inaugural green Pfandbrief that may follow a roadshow starting today and ending next Monday.

Sparkasse Hannover and Wüstenrot Bausparkasse will also go on the road this week, on Wednesday and Thursday, respectively, ahead of expected sub-benchmark issues.

Although the market remains highly supportive for covered bond issuers – with all recent euro trades continuing to perform on the secondary market despite many being priced at near-record tights – some bankers said that many European issuers exiting blackout periods are likely to take advantage of the conducive conditions for higher beta issuance.

“Just this morning we have seen Sparebanken Vest mandating for a sub-benchmark senior while Barclays are offering a green HoldCo bond,” said one. “As most issuers are very well funded in terms of covereds, I expect more of these strategic trades through to the end of the year.”