Greece

After two weeks without benchmark issuance market participants are looking past the UK royal wedding and May Day holiday to a resumption of primary market activity on Tuesday. Syndicate officials were modest in their expectations however as, with peripheral markets effectively closed and some core names in blackout, prospective issuance from for core jurisdictions appears sparse.

Fitch yesterday (Tuesday) downgraded covered bonds issued by the National Bank of Greece to BBB+ and removed them from negative review.

Moody’s expects negative rating actions on covered bonds to substantially outnumber any positive actions in the year ahead, due principally to weakness in the sovereign and banking sectors.

Fitch yesterday (Monday) downgraded the issuer ratings of five Greek banks from BBB- to BB+ and removed them from negative review, though the outlook on the long term ratings is negative.

Moody’s has placed on review for possible downgrade the covered bonds issued by six Greek banks, highlighting that timely payment indicators of the various programmes are “very improbable”.

Standard & Poor’s placed three Greek covered bond issuers and one Greek bank that is setting up a covered bond programme on negative review on Friday, following its placement of the Greek sovereign on CreditWatch negative the day before.

In brief: Greece’s ATEbank is in the process of establishing a Eu5bn covered bond programme, an official at the bank has confirmed.

Greece’s Piraeus Bank is setting up a covered bond programme that will provide for direct issuance if a group of bondholders agrees to amend negative pledge conditions, according to an official at the bank.

Fitch downgraded covered bonds issued by Greece’s Alpha Bank off a direct issuance programme from A to A- yesterday (Thursday), and today withdrew ratings of Alpha covered bonds launched off an indirect issuance programme.

A draft Cypriot covered bond law is close to being presented to parliament, after the European Central Bank gave a conditional positive appraisal of the legislation last week.

Standard & Poor’s is assessing the possible impact on Greek covered bonds of a Greek personal bankruptcy law that will enter into effect at the beginning of September, the rating agency said on Friday.

Fitch downgraded mortgage-backed covered bonds issued by Greece’s Marfin Egnatia Bank from A+ to A- yesterday (Wednesday).