Greece

Moody’s has downgraded Marfin Egnatia Bank’s covered bonds and placed the rating of those issued by National Bank of Greece on review for possible downgrade because of a cut in Greece’s sovereign rating from A1 to A2. These were the only negative rating actions on covered bonds since The Cover’s last bulletin on 18 December to the best of our knowledge; we will catch up on other covered bond rating developments and related issuer rating actions tomorrow (Tuesday).

Moody’s has confirmed the Aaa rating of mortgage-backed covered bonds issued by Alpha Bank Covered Bond plc because of two credit enhancements to the programme. Standard & Poor’s today (Friday) took rating actions on two Greek covered bond issuers because it downgraded the sovereign’s rating earlier this week.

Fitch has assigned an improved Discontinuity Factor to Alpha Covered Bond plc’s covered bonds because the issuer has lengthened the extendible maturity period from 12 months to 10 years. However, the covered bonds’ AAA rating remains on rating watch negative, the rating agency said yesterday (Tuesday).

Fitch placed the AAA ratings of covered bonds issued by National Bank of Greece, Alpha Covered Bonds plc, and Margin Egnatia Bank on rating watch negative yesterday (Wednesday) following the downgrade of Greece’s sovereign rating and the subsequent downgrade of Alpha Bank’s and NBG’s issuer ratings.

EFG Eurobank Ergasias is setting up a covered bond programme off which it hopes to be able to launch an inaugural issue in February 2010, a funding official at the bank told The Cover today (Monday).

Moody’s has put the deposit and debt ratings of National Bank of Greece on review for possible downgrade as part of several actions on Greek banks yesterday (Tuesday) after it put the Hellenic Republic’s A1 rating on review for downgrade.

Fitch on Friday revised the outlook on National Bank of Greece’s rating from negative to stable, citing the bank’s resilient operating profitability in the face of a challenging operating environment.

Alpha Bank is seeking to amend a negative pledge clause that would allow it to issue covered bonds directly instead of via a special purpose vehicle, according to Fitch.

Fitch today (Wednesday) affirmed the ratings of covered bonds issued under 17 programmes following implementation of the rating agency’s new refinancing cost assumptions. The AAA rating of Marfin Egnatia Bank’s covered bonds was affirmed separately yesterday (Tuesday) as the structure of the rating has changed.

A Eu1bn five year cédulas hipotecarias for Banco Bilbao Vizcaya Argentaria priced at the wide end of guidance could signal a welcome leveling of the balance of power between investors and issuers in the covered bond market, according to one banker this (Wednesday) morning. Meanwhile Danske is in the market with a new issue, National Bank of Greece has completed the first Greek benchmark, and we include here a wrap-up of some distribution statistics from earlier in the week. [Updated to correct BBVA pricing.]

National Bank of Greece will price the first Greek covered bond benchmark tomorrow (Wednesday) morning, a Eu1.5bn seven year issue at 90bp over mid-swaps.

Barclays Bank will tomorrow (Tuesday) launch the first benchmark UK covered bond since November 2007 and the first since the Regulated Covered Bond regime came into effect, a 10 year deal that is expected to be at least Eu2bn and at price talk tighter than that heard last week. The deal will hit another frenzied week for covered bonds, with at least two further issues likely in the coming days on top of three today (Monday), and more new names in the pipeline.