'ABC’s of U.S. Covered Bonds'

This 13 page special report not only provides clear explanations about covered bonds and their potential place in the U.S. financial market—but does so from the perspective of one of the world’s major rating agencies.   This is especially important given that ratings agencies’ decisions are a critical ingredient in establishing the price and value of a bond issuance.

The report is organized in a Q&A format.  Some of the questions:

•    “What Are Covered Bonds?”
•    “What Collateral May Back Covered Bonds?”
•    “How Do Covered Bonds Compare to RMBS?”
•    “What Are the Potential Benefits to the Issuer?”
•     “What Factors Should Investors Consider?”
•    “What Program Features Benefit Investors?”

Unfortunately, we cannot provide a direct link to download the PDF, because to access the FitchRatings website, FitchRatings requires a free user registration.  But it is well worth the couple of minutes it will take you to enter your personal contact information and arrange a password.

Once you are logged into the FitchRatings website, just look at the pull-down menu under “financial institutions” on the navigation bar and click on “covered bonds.”  There you will find “ABC’s of U.S Covered Bonds” (issued Sept. 3, 2008).  

While you’re on that part of the site, you also may want to review two other good articles: “The Impact  of Covered Bonds Issuance on Banks Rating” and “2007 Comparative Study of Covered Bonds.”

To create your free account at Fitch, click this link:  www.fitchratings.com