Covered Bonds

Start Dates: TBC

Duration: 1 Day

Full Fee: €600

Network Members Fee: €350

https://www.ifsskillnet.ie Book Now

Programme overview

This one-day programme is designed to help those with experience of government bonds to gain an understanding of the risks and benefits of covered bonds. The programme is taught for a former bond trader and sales person with significant experience of the bond market. The programme can be tailored to the specific audience need.

Please contact info@ifsskillnet.ie for more information on course dates.

Learning outcomes:

  • Understand the price, yield, credit risk relationship
  • Know how asset swaps are created and priced
  • Understand how MTN’s differ from Gilts and Bills.
  • Understand how embedded options influence MTN pricing and yields
  • Understand the potential for credit and liquidity risk
  • Know the legal framework for the issuance of covered bonds.
  • Know how to interpret the monthly investor reports for covered bonds.
  • Understand the similarities and differences of the risk profiles of covered bonds compared to RMBS and straight debt
  • Know the basic structures of mortgage backed securities
  • Understands True sale and bankruptcy remoteness concepts
  • Understand tranches and the risk reward of each tranche

Who is the course for?

This 1 day programme is aimed at front, middle and operations staff at banks. It would also suit corporate treasury staff at building societies

Course Content:

Online Pre-work

  • Bonds – An Introduction
  • Bond Prices & Yields
  • Swaps – An Introduction

Introduction

  • Introduction and Bond maths recap

Swaps and Asset Swaps

  • Creation of Synthetic Floating Rate Instruments
  • Recap of Swaps
  • Creating Asset Swaps
  • Using the logic of Asset Swaps for Relative Value comparison

MTNs

  • Credit Ratings and Credit Risk
  • Credit Spreads, Fixed and Floating
  • Liquidity
  • Finding value in fixed rate instruments
  • Finding value in floating rate instruments
  • MTNs with embedded options (Callable, Capped Floating etc)
  • Liquidity and Credit Spread risks in MTNs
  • Case Studies from recent issues

Covered Bonds

  • Evaluating the risk profile of covered bonds
  • Brief recap of the legal framework used to issue covered bonds in England & Wales
  • What are the protections against issuer default
  • Reading the monthly investor reports (online, Harmonised Transparency Template))
  • How do the programme features impact ratings and liquidity
  • How do the risks and rewards of covered bonds compare to RMBS, and straight debt?
  • Liquidity and Spreads in the covered bonds market.
  • Case Studies from Santander, Lloyds and RBS

RMBS

  • Recap of Securitisation Structures
  • True Sale and Bankruptcy remoteness concepts
  • Credit Enhancement and Tranches
  • Securitising Mortgage Cashflows
  • How bullet classes are created
  • Yield, Spreads and Liquidity in RMBS
  • Case Studies of Triumph and Disaster, Granite, Holmes and others

Summary and Close

Trainer Profile

Please contact info@ifsskillnet.ie for further information on training providers.