Canada

A green bond and a conventional bond both hit the euro market on Wednesday. While neither aimed for size, the pricing action showed much hotter demand for the green offering.

Covered bond issuers are monitoring the dollar market with recent deals from DNB Boligkreditt and CIBC suggesting a welcome reception for further issuance. However, Canadian banks, perhaps the most likely dollar issuers, could well be enticed to consider their home market following TD’s recent success.

Two euro borrowers launched benchmarks on Wednesday, sharing the SSA euro market. While both secured successful deals, one found the market tougher going, as investors pushed back.

Canadian Imperial bank of Commerce this week issued the first dollar covered bond in 144A format this year. The funding, which was much cheaper than the cost of raising a similar deal in dollar senior format, could well unleash a slew of supply, mostly from Canadian banks but also potentially from European names.

After an absence of more than two years, Royal Bank of Canada this week issued its first covered bond in euros, attracting a comfortably oversubscribed order book for a €1.5bn deal which was priced with a skinny new issue concession.

CPPIB Capital achieved a double whammy with its debut green bond this week, bringing the first international sale of a green bond by a pension fund that grew into the largest ever green bond in Canadian dollars.

Pete Osborne, a former director at Singapore Exchange (SGX), has resurfaced at Canadian exchange operator TMX Group in London as head of European equity trading sales.

CPPIB Capital will sell its first ever green bond this week, coming on the heels of a French region’s foray into green and sustainability bonds.

Royal Bank of Canada followed Toronto Dominion into the sterling covered bond market this week, pricing its first deal of the year at the same spread as its peer. Given a relatively high number of covered bond redemptions this year, RBC could well return.

Toronto Dominion Bank issued the only two covered bond benchmarks in what was otherwise a desolate week for the FIG sector. Despite exceptionally volatile market conditions, the euro and sterling transactions went well leading a syndicate banker to conclude that TD "owns" the covered bond market.

Toronto Dominion took advantage of a brief respite from volatility in the European government bond market to issue a €1bn seven year transaction on Wednesday.

Five year covered bonds issued this week from a trio of issuers got the best executions with the most generously priced Canadian deal from the Fédération des caisses Desjardins du Québec (CCDJ) earning the most praise.