| Bank of Ireland readies second covered bond issue |
Back |
Bank of Ireland Mortgage Bank has mandated Barclays Capital, Dresdner Bank, IXIS CIB and Davy to lead manage its second Asset Covered Security (ACS) issue. Subject to board approvals, documentation and market conditions, the launch will follow investor meetings, which are intended to take place in early June 2005.
BoI launched its first deal in September of last year, a €2 billion issue that was over three times over-subscribed. The deal was the first tranche of a planned €10 billion programme. |
So far only three issuers have emerged in the covered bond market – BoI, Depfa ACS Bank, and WestLB Covered Bond Bank – but all three are frequent issuers, and it is hoped that other domestic mortgage banks will follow BoI’s example.
Depfa Bank has just issued a $1.25 billion five-year asset covered security, which is aimed at further expanding Depfa’s worldwide investor base, and Depfa expects the proportion of USD issues to grow in the years to come.
The 5-year issue has a volume of $1.25 billion and carries a coupon of 4.25 per cent. The re-offer price of 99.574 per cent gives a spread of 43bp over the UST 4 per cent due April 2010.
Goldman Sachs, HSBC and Morgan Stanley were joint book-runners on the transaction.
Fifty-three per cent of the issue went into Asia, 21 per cent into Europe and 26 per cent into the US. There was again a high participation from central banks and asset managers in the transaction with central banks taking 53 per cent of the transaction, fund managers 40 per cent, insurance companies 4 per cent and high net worth individuals 4 per cent.
This is the second issue of Depfa’s benchmark funding programme in 2005, and Depfa is planning in the region of €20 billion of long term funding in 2005, of which at least €8 billion will be in the form of benchmark covered bond issues. |
|
| Article appeared in the May 2005 issue.
|
|
