Many private investors, who had to look into the long tube of zero and negative interest rates in recent years, can look forward to higher interest rates again.
It is quickly forgotten that the rise in yields on the bond markets is associated with price losses for these securities.
In addition, it must be taken into account that the real yield on ten-year federal bonds remains deeply negative even after the 1.0 percent mark has been exceeded, because the inflation rate of more than 7 percent has to be deducted.
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Nevertheless, the higher interest rates are having an impact on the financing conditions for new issues.
The difference can be seen in the increase in the green federal bond due in August 2031. EUR 1.5 billion was offered, which investors asked for EUR 2.4 billion.
The yield was 0.93 percent, which is more than one percentage point higher than in the previous auction.
In February, the yield on the green federal bond was still minus 0.2 percent.
Among the new issues of the past few days, the mortgage Pfandbriefe from Deutsche Kreditbank (DKB) and Berlin Hyp stand out.
Because both titles run under the still young category of social bonds.
Both DKB, a subsidiary of Bayern LB, and Berlin Hyp, which now belongs to Landesbank Baden-Württemberg (LBBW), finance residential real estate with the proceeds.
What was striking about both issues was the high level of interest shown by investors.
The DKB refers to its title as Social Housing Bond.
According to the institute, it serves to refinance municipal housing companies in Berlin.
"Demand from investors was extremely high and the bond was oversubscribed almost fivefold with a volume of EUR 500 million, a term of ten years and a coupon of 1.625 percent," said the real estate financier after the placement was completed.
Berlin Hyp's social mortgage Pfandbrief also has a term of ten years.
The Pfandbrief has a volume of EUR 750 million and an interest coupon of 1.75 percent.
Berlin Hyp recorded a demand of 3.0 billion euros on Tuesday, which represents the largest order book for a mortgage Pfandbrief.
The institute has already gained experience with sustainable titles.
In addition to green securities, Berlin Hyp issued a “sustainability-linked bond” last year.
Here, the interest on the bond is linked to the achievement of its CO2 reduction target.
According to Maria Teresa Dreo-Tempsch, who is responsible for capital market business on the Berlin Hyp board, sustainability should be integrated holistically into the core business.Keywords: