CFF and Westpac kicked off April issuance with a bang today, attracting strong demand to print EUR1.25bn eight and seven year deals, respectively, at levels well inside those available earlier this year, showing investors to be undeterred by the prevailing lower spreads and yields.

Compagnie de Financement Foncier (CFF) leads Helaba, Natixis, Santander, Swedbank, UBS and UniCredit went out with initial guidance of the 13bp over mid-swaps area for the French eight year deal and moved to final pricing of 8bp after having built a EUR2.9bn book with over 150 accounts involved, and sized the trade at EUR1.25bn.

The new issue was deemed to have come flat to even slightly through fair value. CFF’s last benchmark was a EUR1bn 10 year in September, also priced at 8bp over, and that was seen at around 11bp over today.

A syndicate banker away from the leads said the new issue was “a very strong statement”.

“Even at levels that are tighter than where everything came in February, for example, this is still getting done and very, very nicely so,” he said. “It just proves that everybody is happy to buy at these tighter levels, even when rates are also lower.”

The last French benchmark, and indeed last core benchmark, was a EUR750m 10 year for Crédit Agricole Public Sector SCF on 21 March priced at 13bp over mid-swaps.

Maureen Schuller, head of financials research at ING, noted that French covered bonds have retightened 12bp from a mid-January peak and are now quoted a touch though the Markit iBoxx Netherlands index again, at 8bp.

She also noted that CFF’s bonds have slightly outperformed sister issuer BPCE SFH’s covered bonds over the same period, to trade relatively closely aligned, noting that CFF’s issuance volumes are set to decline from around EUR6bn annually to EUR2.5bn-EUR3bn on the back of a reorganisation within the BPCE group.

Westpac priced its EUR1.25bn seven year deal on the back of some EUR1.9bn of demand. Leads Barclays, BNP Paribas, Credit Suisse, HSBC and Westpac had gone out with initial guidance of the mid-swaps plus 22bp area and tightened this to 19bp+/-1bp, WPIR, on the back of more than EUR1.75bn of orders before setting the final size and the spread at 18bp over.

“At times Australian trades can be a bit workmanlike,” said a banker at one of the leads, “but this has really flown.”

He put the new issue premium at 1bp-2bp and a banker away from the leads said the last Australian seven year – a EUR1.25bn National Australia Bank deal on 22 January – was trading at around 16bp today. The NAB trade was priced at 33bp over mid-swaps, meaning Westpac today came 15bp tighter.

“This was a great trade and a testament to the strength of the market,” said the lead banker. “The market is bulletproof at the moment.”

A syndicate banker echoed this, saying it is hard to foresee what could “change the game”.

“This is still an issuer’s market and it will remain so,” he said.

Although no mandates have been announced for imminent launch, another syndicate banker said issuers should be looking at tapping into the attractive conditions unless they are doing so with higher beta instruments – or expect spreads to tighten even further.

“That would mean potentially back into negative territory,” he added. “Are we really at that point?”

Berlin Hyp is offering to buy back its single outstanding benchmark public sector Pfandbrief, after having decided to discontinue the rating of issuance out of its public sector cover pool and Moody’s withdrawing the Aaa rating on Friday.