News

Mick YoungThe Australian dollar covered bond issued by the Canadian Imperial Bank of Commerce (CIBC) this month was oversubscribed by about A$250 million (US $247.6 million). Approximately 75 percent of the bonds were sold to onshore Australian investors — predominantly banks — with the remainder largely taken up by Europeans.

This is the first Australian dollar denominated covered bond issued in more than three years.

In an update on the FDIC's stance regarding potential U.S. covered bond legislation, Moody's Investors Service expressed a view that if the FDIC prevails, such legislation "would not put U.S. covered bonds on a level playing field with their European counterparts."

A hearing on covered bonds held by the U.S. Senate Committee on Banking, Housing & Urban Affairs (Sept. 15) highlighted some significant points of dispute between government officials and the financial industry.

The following was released by SIFMA (Sept. 15):

The following was released (Sept. 15) by the Congressional office of U.S. Rep. Scott Garrett:

Following in the footsteps of several Canadian banks plus Germany's LBBW and France's Compagnie de Financement Foncier (CFF), Barclay's Bank Plc launched a U.S. dollar-denominated covered bond (Sept. 14) in the amount of $1 billion.

The five-year bonds were priced at 90 basis points over mid-swaps — 109.5 basis points over comparable U.S. Treasuries — for a yield of 2.525%.

Frankly, news was light in the covered bond world during the second week of August, at summer's height.

Most items of covered bond news compiled below have not received longer treatment as individual articles in this publication, often because they relate to geographic areas outside our focus, North America.  But we also include links to some articles that we have published separately during the past week  — all organized by country.

A Cypress bank issues covered bonds for collateral . . . A professor writes about U.S. covered bonds in the 19th century . . . Eurhypo taps €250 million . . . Caja Madrid to continue repurchases . . . and more

The latest version of U.S. covered bond legislation (H.R. 5823) — which recently won a favorable vote from the House Financial Services Committee (HFSC) — offers both pluses and minuses, according to a comment published by Moody's Investor's Service (August 2).

An Australian lawyer reports on efforts to gain approval for covered bond issuance there . . .  a U.S. dollar tap in Canada  and a Euro CB tap in France . . . plans for more covered bonds in Korea . . . a step forward for CB legislation in the U.S. . . . and more