Kommunalkredit Austria is preparing to return to the covered bond market after a three year absence with a social public sector covered bond, announcing its move the same day Social Bond Principles were unveiled by ICMA as the sector reaches what one banker said is a tipping point.
Berlin Hyp sold a higher share of a Eu500m long six year green Pfandbrief to foreign accounts than on any of its previous benchmark covered bonds, according to head of investor relations and sales Bodo Winkler, while adding accounts new to the credit and achieving tight pricing.
The green and social covered bond markets have considerable potential for growth, according to panellists at an ICMA CBIC/The CBR conference, with a leading investor highlighting his appetite for more paper and “sticky green money” available, but the impact of QE and a lack of data is holding issuers back.
Garanti Bank has placed a TL530m (Eu134m, $150m) five year covered bond with International Finance Corporation with a commitment to use half the proceeds to offer green mortgages, making it the first such green-orientated transaction in Turkey, according to the issuer.
The European Covered Bond Council hopes to ultimately introduce a green covered bond label alongside its Energy Efficient Mortgages initiative, the ECBC’s Jennifer Johnson yesterday (Monday) told a climate bonds conference, where appropriate pricing and collateral were under scrutiny.
Energy efficient mortgages being advanced by the EMF-ECBC can be a key element in boosting green covered bonds and helping the EU meet energy targets, according to an industry survey and participants at a stakeholder meeting today (Thursday), where a Commission official welcomed the initiative.
Caja Rural de Navarra sold a Eu500m seven year debut sustainable cédulas today (Wednesday) that, although priced in the middle of guidance with a book below Eu600m, was deemed a relative success in navigating difficult conditions at the same time as reaching specialist investors.
Bank of China is printing the first deal out of China to be dubbed a covered bond today (Thursday), a three year green issue backed by domestic climate bonds, although bankers noted the deal is being priced in line with the issuer’s senior debt.
The EMF-ECBC launched a project to create an energy efficient mortgage today (Tuesday) that it said could pave the way for broader take-up of green covered bonds, after Berlin Hyp yesterday inaugurated a combined Pfandbrief and senior green programme with a Eu500m seven year unsecured deal.
Kutxabank successfully sold a Eu1bn 10 year social cédulas hipotecarias yesterday (Monday), the first SRI covered bond from Spain, but an official at the issuer said that it had to take into account investor feedback and offer a substantial premium to ensure it could meet its goals.
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