Iccrea Banca attracted over €2bn of demand to a €500m seven year OBG debut today (Thursday), while LF Hypotek priced only the second Swedish euro benchmark of the year. Sparebanken Sør is set to add supply as soon as tomorrow, with Møre Boligkreditt mandating a green sub-benchmark.

Iccrea’s plan to launch a debut benchmark covered bond were announced on Monday, and leads Barclays, Commerzbank, IMI-Intesa Sanpaolo, Santander and Natixis this morning went out with initial guidance of the mid-swaps plus 17bp area for the €500m no-grow seven year OBG, expected rating Aa3. Following revised guidance of the 13bp area, the deal was ultimately priced at 12bp, with demand peaking above €2bn, including joint lead manager interest.

“Everything went very smoothly,” said a syndicate banker at one of the leads. “We ended up more than four times oversubscribed, and the new issue premium was maximum 1bp, which is very much in line for an inaugural trade.”

He put fair value for the seven year OBG at 11bp based on secondary paper for similar names such as BPER trading at 8bp-9bp in the five year part of the curve – with only higher rated Italian names having outstandings in the seven year part of the curve – and said feedback from some investors concurred.

Iccrea’s OBG debut was launched after three days of marketing, including virtual meetings with domestic and non-domestic investors, noted the lead banker.

“The book was very diverse in terms of jurisdiction,” he added, “more than usual for this type of name.”

Only a handful of peripheral euro benchmarks have hit the market this year – all Italian, except for a Eurocaja Rural €700m 10 year sustainable cédulas yesterday (Wednesday) – and the lead banker said this – against the backdrop of overall negative net supply in 2021 – contributed to the interest in the new issue.

“The presence of the Eurosystem has meanwhile allowed Italian covered bond spreads to tighten since the beginning of this year,” he added, “making this market much more favourable for Italian issuers.”

A €750m seven year OBG for Credito Emiliano at the end of June, which was the last Italian benchmark, was priced at 14bp over mid-swaps and this week trading at 4bp over, according to the lead banker.

The mandate for Länsförsäkringar Hypotek (LF Hypotek) was announced yesterday morning, and this morning leads ABN Amro, Credit Suisse, LBBW, SEB and SG went out with initial guidance of the mid-swaps plus 8bp area for the €500m no-grow September 2028 issue, with expected triple-A ratings. After an hour and 25 minutes, they reported books above €1bn, including €80m of joint lead manager interest, and after two and a half hours they set the spread at 4bp on the back of books above €1.35bn, including the €80m of JLM interest. The final book good at re-offer was ultimately some €1.2bn.

A syndicate banker away from the leads remarked that the transaction had gone relatively swiftly.

“It’s not in the same league as the big Swedish banks in terms of following,” he said, “but they managed to get a €1.2bn book, which is a bit larger than in the past, and the execution was relatively textbook, moving from 8bp to 4bp.”

The new issue was priced roughly flat to LF’s January 2026s, which he said were indicated at 4bp, but he put fair value at around 2bp-3bp, based on SCBC’s curve, arguing that this made more sense, with LF paper quite illiquid.

The deal is only the second Swedish euro benchmark of the year, following a €1bn long eight year in June. The banker estimated LF paid 1bp-2bp over what it could have achieved in the domestic market, but noted that Swedish issuers are in general content to pay up slightly to achieve the size, longer tenors and investor diversification more readily available in the euro market.

Norway’s Sparebanken Sør Boligkreditt is expected to launch a €500m no-grow seven year as early as tomorrow (Friday), after having mandated Commerzbank, Crédit Agricole, Danske, Natixis and Swedbank. The new issue will be its second euro benchmark of the year, after a €500m seven year in January.

According to a syndicate banker at one of the leads, that January 2028 issue was trading at 2.25bp, mid, and its green October 2026s at 2bp, while DNB May 2028s were at 2bp and other Norwegian 2028 paper in the area of 2.25bp.

Møre Boligkreditt is planning a debut green covered bond, to be launched after investor calls starting tomorrow. LBBW, Santander and Swedbank have the mandate for the €250m no-grow five year deal.