Deutsche bank has set up a €35bn conditional pass-through structured covered bond programme that will enable the bank to tap the ECB for cheap funding at a time when its senior unsecured spreads have come under pressure. The new programme will allow the bank to utilise assets it would not be able to use under the more stringent German covered bond law. DBRS said there were up to four series expected to be issued under the programme for a total nominal amount of €8.5bn. "The upside is easy collection of nearly €8.5bn of cheap ECB cash, which it can't easily collect in the market with its Pfandbrief programme," said a covered bond expert.
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