The European Commission is expected to delay unveiling its EU Covered Bonds Directive for several days beyond the previously-announced date of next Wednesday, but the text is said to contain no disruptive surprises – even if public sector covered bonds may have been somewhat neglected.

Didier Millerot, head of unit, banks and financial conglomerates, DG FISMA, said in December that the Directive was due to be announced on 7 March as part of a package of Capital Markets Union (CMU) measures. The Commission’s action plan on sustainable finance was also expected to be a part of this.

However, The CBR understands that the announcements will be delayed for several days, probably until the following Monday, 12 March.

According to an industry source, the postponement is unlikely to be strictly related to the covered bond Directive.

“We are not expecting any big surprise,” he said. “It is very much a principles-based framework, very inclusive and designed around the status quo of the market, but at the same time trying to bring in the elements necessary to create a kind of European covered bond label benchmark.”

A market participant said that public sector-backed covered bonds had initially been neglected by the Commission’s principal text, which focused solely on mortgage-backed issuance.

However, according to the industry source, public sector-backed issuance will be covered in the overall covered bond package.

“The general spirit of the Directive is very attentive to both the mortgage side and public sector, defining the qualitative criteria to identify high quality assets,” he added.