New jurisdictions are continually being added to the covered bond universe as governments pass laws to help their financial institutions gain access to a cheap and stable source of funding. Last year, the first deals took place under new laws from Portugal and Sweden. Already this year, Turkey has passed a covered bond law, and legislation is on the way in Italy and Norway.
Issuers from new jurisdictions generally get a good reception, because covered bond investors are seeking diversity in their portfolios. This was the case with the first deal out of Portugal last November, a €2bn 10-year offering from Caixa Geral de Depositos.
