The vdp member institutions perceive a positive mood on the market for covered bonds and unsecured bank bonds. This is the result of the seventh survey on the vdp emissions climate. For the first time since the start of the survey in December 2022, clearly positive values are determined for all three scores.
While the score for unsecured bank bonds has improved from +5 to +22 since the last survey in June 2025, the score for Pfandbriefe climbed into positive territory for the first time ever (+14 compared to -1 in June 2025). Both developments led to the fact that the overall score of +17 was also higher than ever before.
The vdp emissions climate is surveyed and published twice a year. The sentiment indicator is given in a range of -100 to +100 points.
Strong demand for Pfandbriefe in 2025
In the first eleven months, vdp member banks issued a volume of EUR 61.2 billion in new Pfandbriefe, which corresponds to an increase of 22% compared to the same period last year. In the case of Public Pfandbriefe, EUR 21.4 billion of newly issued Pfandbriefe have been recorded so far, an increase of 73%. New Mortgage Pfandbriefe with a volume of EUR 39.8 billion were issued from January to November 2025, an increase of 7%. Pfandbriefe in benchmark format (EUR >500 million) accounted for a volume of EUR 31.4 billion, compared with EUR 29.9 billion in the same period of the previous year.
Of key importance for the long-term residential real estate financing business is the fact that Pfandbriefe could be successfully placed over the full maturity spectrum throughout 2025. Around one third of all benchmark issues have maturities of at least seven years.
“The good demand for Pfandbriefe with longer maturities supports the refinancing of long-term residential real estate financing on time,” commented Sascha Kullig, member of the vdp Executive Board.
Determinants of demand in 2026
While the current investor demand for Pfandbriefe showed a score of 78 points in the survey, the experts from the member institutions were noticeably more cautious with regard to the next six months and awarded a score of 22 points. Among the determinants of the development of investor demand for Pfandbriefe over the next six months, the asset swap spread level (-20 points) and the premium to German government bonds (-19 points) were assessed as rather negative, as both factors weighed on the relative attractiveness of Pfandbriefe. Compared to asset swaps, German Pfandbriefe narrowed by around 20 basis points over the course of the year. On the other hand, the maturities (+27 points), the lending business to be refinanced (+38 points) and the expected level of oversubscription (+49 points) were cited as positive factors.
High demand for unsecured bank bonds
The mood for the unsecured bank bond segment was also positive: investor demand was currently rated at a score of +72 points, while the score for the past six months was +43 points. The experts surveyed were much more skeptical about the next six months: A score of 0 was determined here. “One reason for this assessment is likely to be the tightening of spreads associated with very strong demand, which could weaken the relative attractiveness for investors and thus demand. In principle, however, the strong demand for the unsecured bonds of our member institutions reflects investors’ confidence in the resilience of the institutions due to the good earnings situation and a good to very good capital base,” explained Kullig.
About the vdp emissions climate
Methodology
The survey includes assessments of the past six months, the current situation and the next six months, with the latter receiving the greatest weighting in the evaluation. This is used to determine a score for Pfandbriefe and unsecured bank bonds, as well as an overall score. A score of 0 corresponds to a stable capital market environment in which issuance plans can be implemented without any problems. Negative (maximum -100) and positive scores (maximum +100) indicate a below-average or above-average emissions environment.
Twice a year, the vdp Emissions Climate provides information on the mood among the member institutions of the Association of German Pfandbrief Banks (vdp) with regard to the placement of Pfandbriefe and unsecured bank bonds. To this end, capital market experts from vdp members will be asked about the influences that determine the sales of covered bonds and unsecured bank bonds. The survey covers the past six months, the current situation and the next six months, with the latter receiving the greatest weighting in the evaluation. The individual responses are summarised in thematic areas that provide an overview of the supply and demand constellation on the markets for covered bonds and unsecured bank bonds. Based on certain assumptions on the relative importance of the individual subject areas, three scores are determined from this, namely one score each for covered bonds and unsecured bonds and an overall score. A score of 0 corresponds to a stable capital market environment in which issuance plans can be implemented without any problems. Negative and positive scores indicate a below-average or above-average emissions environment.
The Pfandbrief banks that are members of the vdp represent a market share of 96% of the outstanding Pfandbriefe.
