The ECB registered a fall in the size of the CBPP3 portfolio of EUR462m last week as well-flagged hefty redemptions of around EUR1bn exceeded gross purchases, and secondary market buying decreased.

ECB figures released on Monday show the CBPP3 portfolio decreased EUR462m in the week to last Friday, from EUR253.759bn to EUR253.297bn. Figures released yesterday (Tuesday) afternoon show that around EUR1bn of CBPP3 holdings matured last week, implying gross purchases of around EUR538m.

Gross purchases therefore decreased from around EUR689m in the previous week and remained below the 2018 average of EUR1.065bn.

Two CBPP3-eligible deals settled last week, a EUR1bn issue for Nordea Mortgage Bank and a EUR500m issue for Deutsche Pfandbriefbank. Analysts estimated that the Eurosystem’s combined share of the deals amounted to some EUR290m.

This implies secondary market purchases averaged around EUR50m per day last week, down from around EUR111m per day in the previous week and their lowest since the start of May.

Last week’s redemptions had been anticipated, as the ECB had announced EUR1.135bn of redemptions for May and only around EUR200m had been reported earlier in the month. And they are a taste of things to come, as redemptions in the CBPP3 portfolio will in June be the highest for any month this year, at EUR3.202bn.

The ECB’s efforts to reinvest these maturities should be supported by an upturn in issuance, analysts have suggested, with EUR5.5bn of CBPP3-eligible supply to settle this week.