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ALLGEMEINE Hypothekenbank braved a sceptical market to launch a Eu5bn Pfandbrief issue this week, which bankers predict may be the forerunner of a new class of superjumbo bonds in the sector.
AHB's deal easily surpassed the previous record size for a Pfandbrief issue - a Eu3bn bond from DePfa. At an equivalent of about DM10bn, AHB's 10 year deal dwarfs the DM1bn-DM3bn issues which characterised the early stages of the jumbo Pfandbrief market. It also matches the liquidity of many Bunds.
The new generation of Pfandbriefe will be supplemented in the weeks to come with jumbo issues from DePfa and Rheinhyp.
Many banks not involved in AHB's deal had cast doubts over whether the Pfandbrief sector was ready for such a large deal, and also criticised AHB's timing in executing such a large bond issue during the August holiday season.
With lead managers ABN Amro, Deutsche Bank, DG Bank, Dresdner Kleinwort Benson and WestLB having sold about two thirds of the deal on the day of launch (Thursday), the jury was still out on whether AHB's deal had been a success.
Negative comments about the size and timing of the deal in the German press, in particular, had hit placement in AHB's domestic market. But Wolfgang Bledau, head of treasury at AHB, was pleased with the results.
"Our lead managers did a very good job," he said. "In the days ahead of launch we suffered from...