Berlin Hyp attracted over EUR1bn of orders to a EUR750m long four year Pfandbrief today (Monday), with demand supported by the deal’s maturity, which particularly appealed to asset managers. Sparebanken Vest Boligkreditt is set to follow with a short five year tomorrow.

Following a mandate announcement on Friday, leads BayernLB, Commerzbank, DekaBank, Erste and HSBC launched the October 2022 issue with guidance of the mid-swaps minus 8bp area this morning. The spread was later fixed at minus 10bp and the size at EUR750m with books over EUR1bn and more than 50 accounts involved, excluding joint lead manager interest.

The deal is Berlin Hyp’s first benchmark Pfandbrief larger than EUR500m since June 2014, when it issued a EUR750m five year.

Demand for the deal was supported by its rare and attractive maturity, said syndicate bankers. The deal is the shortest-dated euro benchmark covered bond of the year.

“The main difference here in comparison to other maturities and other recent prints is that there was a much stronger bid from asset managers, who were very interested in the short maturity,” said a syndicate banker at one of the leads.

Some bankers said the deal paid a new issue premium of around 1bp, based on its most recent issuance, while others said it was closer to 5bp, based on older points on the issuer’s curve. Berlin Hyp May 2023s – the issuer’s most recent benchmark Pfandbrief, priced on 23 May – were seen trading at around minus 11bp, mid, today. The issuer’s outstanding 2022-2023 benchmarks were seen trading tighter, however, at around minus 16bp.

Sparebanken Vest Boligkreditt announced this afternoon that it has mandated Commerzbank, Credit Suisse, Danske Bank, LBBW and Natixis to lead manage a EUR500m no-grow March 2023 covered bond. The deal is expected to be launched tomorrow (Tuesday).

Sparebanken Vest Boligkreditt March 2021s were seen today at minus 5.5bp, mid, April 2022s at minus 3.5bp, February 2024s at minus 2.5bp and February 2025s at minus 1bp.