Hypo Noe and Prima banka issued EUR500m no-grow seven year deals today (Tuesday), the Austrian paying a new issue premium of 1bp despite only modest oversubscription, while the Slovak’s “juice” proved attractive. Bawag PSK and Deutsche are set to launch EUR500m 10 years tomorrow.

Bawag PSK has mandated Barclays, Erste, HSBC, LBBW and UniCredit for its EUR500m no-grow 10 year, while Banca IMI, Deutsche, Rabobank, Swedbank and UniCredit will lead Deutsche Bank’s EUR500m no-grow 10 year.

After a mandate announcement for Hypo Noe yesterday (Monday), leads DekaBank, DZ, Erste, LBBW and UniCredit this morning went out with guidance of the mid-swaps plus 11bp area for the EUR500m no-grow seven year public sector Pfandbrief. After around 50 minutes, they reported books in excess of EUR500m, excluding joint lead manager interest, and after a little over an hour and a half guidance was revised to 9bp+/-1bp, will price in range, on the back of orders over EUR800m, including EUR90m JLM interest. The spread was ultimately set at plus 8bp on the back of a book of EUR830m, including EUR90m JLM interest.

A syndicate banker away from the leads said that although the deal began encouragingly, the deal then lacked momentum. However, he said that in today’s deeply negative-yielding environment, this was far from surprising – the new issue was priced to yield minus 0.25%.

“They ended up with a book of slightly over EUR800m, including some JLM interest, but 8bp is still a decent outcome,” he said, noting that this was equivalent to a new issue premium of 1bp.

Also placing fair value at 7bp, a syndicate banker at one of the leads said that 1bp of new issue premium was at the tighter end of recent trades.

“It was a decent success,” he said, “most definitely not a high-flyer, but it appealed to enough people to make it work.”

A syndicate banker at another of the leads said he had expected the initial to guidance to impact the book size more than it ultimately did.

“Four basis points of new issue premium at the start was a touch more ambitious in comparison to other recent trades,” he said, “but in the end the momentum was good, the book continued to grow and they managed to tighten by 3bp, which is in line with other trades.”

He said that despite a somewhat modest book size, the trade was a moderate success.

“They’ve achieved a new issue premium of 1bp and EUR800m plus a bit from the leads, meeting the issuer’s targets,” he added, “and in that context it went well.”

The issue was largely driven by bank treasury demand, according to the lead banker.

“We had more than 40 accounts involved,” he said, “but this a reflection of the market as a lot of accounts are staying sidelined because of the negative re-offer yields, and that is making the investor base smaller and you have to take this into account.”

Prima banka Slovensko sold its first benchmark covered bond today, a EUR500m seven year issue, which was priced at plus 24bp and attracted over EUR700m of orders. The deal marks the first negative yielding covered bond from an issuer from central and eastern European, yielding minus 0.096%.

Following a roadshow last week, leads Commerzbank, DZ and LBBW went out this morning with initial price thoughts of mid-swaps plus high 20s for the Slovakian issuer’s EUR500m no-grow seven year covered bond. Around an hour and a half later, they reported books over EUR500m, excluding joint lead manager interest, and after around two hours and 15 minutes, guidance was set at 25bp+/-1bp, will price in range, on the back of orders over EUR700m. The spread was ultimately set at plus 24bp on the back of over EUR700m of orders, including EUR40m JLM interest.

“This was quite a juicy spend for investors compared to the very tight and negative-yield environment,” said a syndicate banker away from the leads. “Investors were happy to see this new name.”

A syndicate banker at one of the leads described it as a “solid first print”.

Prima banka Slovensko is the third and smallest euro benchmark covered bond issuer from the Slovak market, which was only opened in March.

The lead syndicate banker said it was difficult to find fair value on the trade due to the small size of the Slovak market.

“This one trades a bit separately as their balance sheet is fairly small,” he added.

A syndicate banker at another of the leads put the new issue premium at 3bp.

“The issue was carefully prepared by the issuer with a three day roadshow,” he said. “Many of those who were visited and looking at this from a strategic perspective found their way into the book, but I would not rule out that there was less conservative money in this as well.”