Refinancing on the capital market is an important part of SaarLB’s refinancing strategy. As a permanent issuer, we offer classic private placements as public covered bonds (Pfandbriefe), mortgage-backed covered bonds and uncovered bearer bonds, both as fixed-interest and variable-interest issues. In addition to bearer securities, SaarLB issues both covered and uncovered registered bonds as well as promissory notes, which can be acquired by institutional investors starting at a volume of € 1 million or more.
In 2020 SaarLB placed a sub-benchmark issue of € 250 million for the first time as a public covered bond in a public placement.
In addition to the classic refinancing products, SaarLB also issues green bonds, thus underscoring the expansion of the Bank’s sustainability strategy. You can find more details here.
In addition to its own issues, SaarLB offers competitive pricing on all standard euro products on the capital market. Our main focus is on trading public, covered and uncovered securities and securities-like instruments, corporate bonds and equity surrogates of credit institutions.
Speak with our employees in the securities areas. They will support you in implementing a jointly developed concept within the agreed parameters.
We also publish current offers on our Bloomberg SAAR page.
The issuance of these securities is based on the strict provisions of the new German Pfandbrief Act (PfandBG). They are used to refinance loans secured by – mostly senior – real estate liens. SaarLB’s mortgage-backed covered bonds are listed on the regulated market of the Frankfurt Stock Exchange.
This type of security is very similar to the issuance of covered bonds, with loans to the public sector serving as collateral for these securities. Otherwise, they have the same characteristics as mortgage-backed covered bonds.
SaarLB’s public sector covered bonds are also listed on the regulated market of the Frankfurt Stock Exchange, are eligible as cover funds and are absolutely secure.
Both mortgage-backed and public sector covered bonds are only included in equity to a limited extent with a solvency factor of 10%; the large exposure limits are not affected.
The advantage of variable interest-rate bonds lies in the fact that the interest rate is close to the money market rate and the resulting moderate price fluctuations. Floaters are usually issued on the basis of the 3- or 6-month Euribor plus a premium customary on the market.
SaarLB is also one of the issuers of both covered and uncovered variable interest-rate bonds.
These securities are classified as uncovered bonds because they are not secured by mortgage loans or loans to the public sector. This requires the equity capital inclusion to be 20%, and these securities must also be taken into account in the large exposure limits in accordance with the German Banking Act (KWG). However, this is offset by a higher return.
SaarLB’s bearer bonds are listed on the regulated market of the Frankfurt Stock Exchange.
Both covered bonds and bearer bonds do not have to be included in equity within the savings bank organisation.
Mezzanine products are securitisations of debt with equity-like characteristics.
They are usually issued in the form of silent reserves, profit participation capital or subordinated loans.
These are interest-bearing promissory notes or bonds in which only creditor rights and no shareholder rights are securitised.
The main differences to a loan are the subordination to other creditors and the waiving of collateral. The terms of this generally long-term capital transfer are agreed individually and are higher than the interest rates for covered bonds and promissory notes due to the increased risk.
Our team mainly deals with the placement and issuance of mezzanines of German credit institutions with total assets exceeding EUR 1 billion.
These bonds, issued as securities or as securitised receivables, are placed by companies in order to raise funds on the capital market.
Most of these are fixed-interest securities with yields that are generally higher than those of bank bonds, although they are highly dependent on the rating.
Due to their advantages, the popularity of promissory notes has increased significantly. In part, this is because these securities-like products are to be accounted for by the investor as receivables in accordance with the German Commercial Code (HGB) and therefore do not have to be written down.
Furthermore, they can be structured entirely according to the investor’s wishes and, for non-banks, are also covered by the deposit insurance, provided that the issuer belongs to a deposit insurance system in Germany.
SaarLB is itself an issuer of promissory notes and, as your partner on the capital market, it acts as a broker for third-party securities issued by banks and savings banks as well as by companies.