Greece

The prospect of Greek banks issuing tier two capital early next year was heightened this week after two more of the country's big four institutions successfully printed covered bonds, writes Bill Thornhill.

Korean Housing and Finance Corporation (KHFC) has opened order books in dollars, Muenchener Hypothekenbank (MuHyp) is set to price a small Swiss Franc deal and Piraeus Bank has finalised terms for its floating rate bond that was mainly placed with supranationals.

Eurobank Ergasias is set to issue its first covered bond some 80bp tight of the Greek sovereign, exactly mirroring the pricing differential that National Bank of Greece (NBG) achieved with its larger trade in the same tenor two weeks earlier.

Eurobank Ergasias has mandated leads for a roadshow, marketing a near replica transaction of National Bank of Greece’s (NBG) three year conditional pass-through that was issued last week.

National Bank of Greece showed this week that a covered bond does not need to have an investment grade rating to be a success. By implication the product has almost unlimited funding potential for a broad swathe of global issuers, particularly those from the emerging markets, writes Bill Thornhill.

Unrated jewellery company Folli Follie debuted in the Swiss franc bond market on Wednesday, having failed in a previous attempt — a sign that retail buyers are becoming more receptive, market participants said.

The National Bank of Greece’s €750m three year conditional pass through (CPT) covered bond does not include an investor put option. Although the programme allows for put options it was not used in this week’s deal and is unlikely to be used in future deals, according to the head of covered bond structuring at UBS which arranged the transaction.

National Bank of Greece’s ability to attract a high oversubscription for its three year covered bond on Tuesday showed it is on the road to recovery. But without sovereign debt relief, the precarious state of Greece’s government finances will continue to blight the economy and its fragile banks.

National Bank of Greece attracted a diverse and deep pool of demand for its €750m three year covered bond on Tuesday, illustrating its ability to overcome investor concerns over its high non-performing loan ratio and the sustainability of the Greek government’s debt reduction programme.

National Bank of Greece (NBG) has appointed leads to market its first covered bond since the Greek sovereign crisis, a transaction which rival bankers believe is assured of success.

With 65m people displaced worldwide, the refugee crisis can seem insurmountable. But despite this daunting scale, initiatives are being tried that could help some of those affected. Citigroup’s charitable foundation is giving $2m to a project to train refugees for the job market and entrepreneurship, in Greece, Jordan and Nigeria.

National Bank of Greece’s covered bond rating would be higher given the bank’s commitment to a 25% minimum overcollateralization ratio, but this is constrained by the sovereign and issuer rating.