Covered bonds: ECBC puts a head on troubled shoulders

“The failing of the ACI decision was that it was made exclusively by traders” Richard Kemmish, Credit Suisse

The group will comprise representatives of the eight largest covered bond markets by outstanding jumbo issuance volume and the eight most committed market-making institutions. According to the ECBC, the 16-person committee will advise on measures to amend market-making agreements to “facilitate a return to orderly trading conditions”. If it succeeds, it will be none too soon. Some of the words being used to describe the present state of the covered bond market (“confused”, “sporadic”, “patchy”, “messy”) would have been laughed at had they been pitched six months ago.