Dexia MA, Landesbank Rheinland-Pfalz play on strengths to overcome Pfandbrief pains

Headnote

Dexia Municipal Agency (Dexia MA) and Landesbank RheinlandPfalz (LRP) benefited from the recent lack of confidence in the German Pfandbrief market when they launched their respective covered bonds this week.

Dexia MA launched its Eulbn 10 year obligations foncieres issue via ABN Amro, Credit Agricole Indosuez and JP Morgan on Tuesday at 23.4bp over the 5% April 2012 OAT, equivalent to 31.8bp over the 5% January 2012 Bund. LRP followed on Wednesday with a Eul.Sbn five year Offentlicher Pfandbrief, via Citigroup/SSSB, Merrill Lynch and WestLB, which was priced at 23bp over the 4% February 2007 Bobl.

Both borrowers are triple-A rated, but they were acutely aware of the problems the recent downgrade of Allgemeine HypothekenBank Rheinboden has caused...