CCDJ found strong demand for the first euro benchmark in over a week today (Tuesday), pricing a €750m five year flat to inside where its compatriots tapped the market two weeks ago, while a Landesbank Saar €250m seven year Pfandbrief was four times covered.

Following a mandate announcement yesterday (Monday), Fédération des caisses Desjardins du Québec (CCDJ) leads Commerzbank, Natixis, NatWest, RBC and SG went out this morning with initial guidance of the mid-swaps plus 9bp area for the February 2027 five year issue, expected ratings triple-A. An update put books above €1.5bn, and the leads ultimately set the spread at plus 5bp and the size at €750m (C$1.07bn), with orders reaching some €2.1bn.

“They got it going convincingly” said a banker away from the leads, “and they started 1bp tighter than their Canadian predecessors did, but apparently, it didn’t cause them any major headache.”

The week before last, Royal Bank of Canada and Bank of Montreal priced €2bn 5.25 year and €2.75bn five year deals, respectively, at plus 6bp following initial guidance of the 10bp area, while National Bank of Canada (NBC) followed with a €1bn five year that was priced at plus 5bp from the 10bp area. The latter’s book peaked above €2bn, with €1.5bn good at re-offer.

The syndicate banker put fair value at 4bp-5bp, implying a marginal new issue premium. The outcome in line with to better than CCDJ’s compatriots was achieved despite the issuer coming to market after uncertainty had contributed to a lack of financial institutions issuance over the past week.

Landesbank Saar also hit the market this morning after a mandate announcement yesterday, with leads DekaBank, LBBW and UniCredit this morning opening books with initial guidance of the mid-swaps plus 6bp area for its February 2029 public sector Pfandbrief, expected rating triple-A. After 35 minutes, they reported books above €750m, excluding joint lead manager interest. After an hour and 20 minutes, they fixed the spread at plus 2bp on the back of books above €1bn, excluding JLM interest, and good at re-offer.

“Very successful,” said a syndicate banker away from the leads, noting the deal was four times covered.

He suggested the leads could have started with guidance 1bp tighter and ended up with a tighter outcome.

The lead banker acknowledged that the initial guidance was on the defensive side but put the new issue premium at 2bp and said such an outcome was in line with prevailing NIPs of 1bp-2bp for covered bonds.