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Covered Bond & Agency Monitor - Austria's new covered-bond framework is in sight (English version)

  • Covered Bond market telegram: There has been low new issuance activity this week owing to the public holiday on Monday in many markets. Investors and issuers also need to digest the ongoing repricing of longer durations. Secondary market spreads showed softer trading, mainly driven by a widening of the long end of the curve.
  • SSA market telegram: Several issuers were active in the SSA primary market this week and the total bond supply amounted to EUR 3.5bn. In secondary markets, the iBoxx Sub-Sovereign index remained unchanged.
  • Canadian housing market: In May, the Bank of Canada published its 2021 Financial System Review. In this report, it was pointed out that, in general, many households have built up savings and paid down debt over the past year. Signs of financial stress, like personal bankruptcies, are low. This is mainly thanks to exceptional government support.
  • Austria’s path to a new covered-bond legislative framework: After 16 years in which covered bonds in Austria were issued under three different legal frameworks, the long-awaited and updated single framework is close to being introduced. The Austrian Ministry of Finance published a draft of the new covered bond legislation. Following a consultation period and the implementation of potential changes, the new law is scheduled to come into force on 8 July 2021.

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