Canadian Imperial Bank of Commerce (CIBC) issued a $1.75bn three year covered bond yesterday (Wednesday), only the second US dollar-denominated benchmark covered bond of the year, achieving a price comparable to what was available in euros, according to CIBC’s Wojtek Niebrzydowski.

US dollar covered bonds have been in notably short supply over the last 12 months. Before today, only four benchmark deals had been launched since last June, totalling $3.525bn, almost half of which came in another $1.75bn issue for CIBC in July 2017.

The new issue is the second US dollar benchmark covered bond of the year, following a $650m issue for NordLB Luxembourg in February, and the first in 144A format.

Leads CIBC, Citi, HSBC, RBC and UBS launched the deal with guidance of the low to mid-30s over mid-swaps. Guidance was later revised to the 30bp area, before the spread was fixed at 30bp and the size at $1.75bn (EUR1.51bn, C$2.33bn). The final book stood at over $2.5bn.

“It went very well, as evidenced by the book size of over $2.5bn, post-drops, and final pricing of 30bp, which was substantially comparable to what could have been achieved in euros,” Niebrzydowski, vice president, treasury at CIBC, told The CBR.

Syndicate bankers said the deal offered a new issue premium of around 2bp, based on CIBC’s secondary curve.