Latvia

Luminor’s Estonian cover pool will have Latvian mortgages, Bawag’s Austrian cover pool will include Dutch mortgages. And once merger plans are fully completed, Caixabank’s cover pool will include those from Bankia, making it Spain's biggest, with a share of almost a third of the Spanish covered bond market.

Luminor Bank is likely to issue the debut Estonian covered bond in the first quarter of 2020 according to the bank’s head of treasury, Max Ehrengren. Although the programme will have capacity to issue deals secured on Lithuanian and Latvian assets, the inaugural transaction will be exclusively secured on Estonian assets.

The European Central Bank said on Thursday that AS PNB Banka was "failing or likely to fail", marking the second time in as many years that a Latvian bank has been declared insolvent.

Air Baltic, an airline 80% owned by the Latvian government, printed its €200m five year non-call three debut bond on Tuesday from an order book of €300m.

Air Baltic, an airline owned by the Latvian government, has released initial price guidance for its €200m five year non-call three debut bond at 6.75%-7%.

A new name hit screens on Tuesday announcing a roadshow. Air Baltic, an airline owned by the Latvian government, will meet with investors to promote a euro deal.

Latvia re-opened its 2049 line on Monday, bringing the total to €1bn with a tap that came almost flat to its curve and completed its funding programme for the year.

Latvia was in market on Monday for a tap of a 30 year bond, returning to the line it opened three months ago. The deal enjoyed strong demand, allowing leads to slice 6bp from the spread.

Valdis Dombrovskis, vice president of the European Commission, joined a chorus of voices at a European Covered Bond Council plenary meeting in Riga this week in praising efforts to create a harmonised covered bond framework for the Baltic states. But market participants said the project still had some way to go, with those involved working hard to flesh out the final details.

The Energy-Efficient Mortgage (EEM) initiative took another important step towards its objective of delivering a standardised European framework on Wednesday, with an event in Latvia bringing together various sponsors to discuss plans for the market’s development.

The covered bond industry and the Capital Markets Union (CMU) hit a new milestone on Thursday after the European Parliament’s plenary in Strasbourg adopted the text of the Covered Bond Directive just after midday.

The Estonian parliament’s recent approval of covered bond legislation paves the way for the first Baltic deal, which could come from Luminor Bank, but whether it is initially secured on a pool of pan-Baltic mortgages remains to be seen.