Berlin Hyp issues first jumbo mortgage pfandbrief of 2012

Berlin-Hannoversche Hypothekenbank (Berlin Hyp) has announced the placing of a EUR 1 bn mortgage pfandbrief on the capital market, the first jumbo bond secured with mortgages to be placed by a German issuer in 2012.

The issue was welcomed among German and international investors, with the order book reaching a volume of EUR 2.2 bn after only 45 minutes.

The reoffer-spread of 9 basis points compared to mid-swaps is the lowest a German bank has had to pay so far this year when placing a bond in benchmark format, Berlin Hyp said in a statement. The new bond carries a coupon rate of 1.375% and has a five-year maturity.

Banks were the largest group of investors, filling 37% of the order book; of this figure, a major part related to savings banks. Fund managers took 34% of the bond, central banks and agencies 17%, and insurance companies 10%. The most sizeable proportion of orders came from Germany with 68%, followed by Austria and Switzerland (8%), Scandinavia (8%) and Asia (5%).

'We’re delighted that investors have responded so positively and in such great numbers to our issue,' said Gero Bergmann, management board member of Berlin Hyp in charge of the Treasury division. 'In view of the ongoing very difficult situation on the international markets, there continues to be a substantial need among investors to make highly secure investments such as a Berlin Hyppfandbrief.'

The transaction was arranged by a consortium consisting of Barclays Capital, DZ Bank, HSBC, JP Morgan and Landesbank Berlin.