HSH Nordbank has placed a mortgage Pfandbrief of EUR 500 mln, in its first Pfandbrief issue this year. The Pfandbrief has a 3.5 year term and a coupon of 2.5%. The issue price was set at 99.62%, which equates to a re-offer spread of 25 basis points above the mid-market swap rate.

HSH Nordbank has placed a mortgage Pfandbrief of EUR 500 mln, in its first Pfandbrief issue this year. The Pfandbrief has a 3.5 year term and a coupon of 2.5%. The issue price was set at 99.62%, which equates to a re-offer spread of 25 basis points above the mid-market swap rate.

‘We don’t have a target in terms of how many other Pfandbriefe we may place this year but I think there will be others. Both this one and our last one were oversubscribed,’ an HSH Nordbank spokesman told PropertyEU. In June last year, the bank returned to the public capital markets with the placement of a Pfandbrief with a volume of EUR500 mln.

Around EUR8.75bn in Pfandbriefe have been issued in total in Germany this year, according to Germany’s Association of Pfandbriefe, Verband deutscher Pfandbriefbanken. This comprises nine transactions, of which two were sub-Jumbo - less than EUR 1 bn in volume - including HSH Nordbank’s latest placement. The total issuance of benchmark formats in 2010 was about EUR 26 bn in Pfandbrief, a spokesman for the Verband deutscher Pfandbriefbanken told PropertyEU.

And this year, that volume is likely to grow, said Frank Teuber, head of funding and syndication affairs at HSH Nordbank. ‘I expect the total issuance this year to be higher than last year. There is a growing trend to buy more secured assets and the Pfandbrief market is still seen as a reliable way to refinance,’ Teuber told PropertyEU.

HSH Nordbank is the only German bank to have three rated Pfandbrief cover pools. It issued the mortgage Pfandbrief as joint lead with BNP Paribas, Commerzbank, Deutsche Bank and Société Générale.

In December, HSH Nordbank’s mortgage cover pool received the highest rating - Aaa - from Moody’s rating agency. The cover pool is around EUR 6 bn, largely comprising commercial real estate but also some residential properties.