PKO BP mortgage bank eyes first covered bond issuance for turn of 2015/16

The upstart mortgage bank of listed banking group PKO BP will likely issue its first pool of mortgage-backed covered bonds on the domestic market at the turn of the year, the CEO of the mortgage banking unit Rafał Kozłowski told PAP. 

“We plan to conduct our first covered bond issue on the domestic market at the turn of the year,” Kozlowski said. “The following issue will be directed to European markets.”

The size of the issue will depend on market appetite and what type of loan book the mortgage bank has available for the cover book at the time, he said.

Work is already underway to shift mortgage loans from the parent bank to the mortgage banking unit, he said. The first such transfer will likely take place at the turn of the year.

Kozlowski called his bank’s Aa3 Moody’s rating “testimony to very high level of security” behind the pending issuance.

Poland amended legislation governing covered bond issuance and mortgage bank operation in mid-2015 in a bid to breath new life into the rather moribund corner of the market. New rules take effect January 1, 2016.

seb/ gty

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