The volume of European covered bond issuance is on course to set a new record for 2004 and bankers believe this growth trend will continue next year, augmented by first-time issuers from countries with new covered-bond legislation. Both Sweden and Norway have recently established covered-bond laws and the first deals are expected early next year. Portugal and Italy are also likely to pass covered-bond laws and get their first deals done some time in 2005. But it is not only countries with specific covered-bond legislation that are seeing a boom in issuance. During 2004, the main focus on new issuers has once again involved UK structured bonds, which are not backed by any covered bond law. Since HBOS launched the groundbreaking first deal in summer 2003, it has been back with four subsequent offerings, and there have also been deals from Northern Rock and Bradford & Bingley.
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