Barclays looks for buyers of covered bonds

Barclays Capital, one of the biggest global investment banks, has started to look for buyers of covered bonds in Romania, issued by the French company Compagnie de Financement Foncier, one of the biggest issuers of such instruments worldwide. Covered bonds are guaranteed either by means of a mortgage credit portfolio, or by a public debt portfolio, with holders collecting capital from the reimbursements of the final creditors. The bonds are issued by a vehicle-company, so that investors are not exposed to the risk of the company initiating the operation becoming bankrupt, in this case Compagnie de Financement Foncier (CFF). “The high liquidity of the financial markets in Romania and the increase in the number of institutional investors is prompting leading issuers such as CFF to look towards Romania for cash,” Ted Lord, managing director of Frankfurt-based Barclays Capital, told ZF. The French, advised by Barclays have already found buyers for the bonds in euros they issued at the beginning of this year.