Marfin Popular issues 1 bln eur covered bonds

Marfin Popular Bank <MRBr.AT>, Cyprus's second-largest lender, said on Thursday it issued a new series of covered bonds totalling 1.0 billion euros ($1.3 billion) to be used as collateral for funding from the ECB.

The bank, which is also present in Greece, said the one-year bonds are secured by a cover pool of residential mortgages and are part of a 3.0 billion euros covered bond programme established earlier.

With access to interbank wholesale funding closed because of the country's debt crisis, Greek banks have turned to the ECB to satisfy liquidity needs.

On July 30 Greece's biggest lender National Bank <NBGr.AT><NBG.N> issued covered bonds totalling 1.5 billion euros. 
"The bonds were listed on the Irish stock exchange and were acquired by the bank at the issue price with the purpose of redistributing them to institutional investors at any time before they mature," Marfin Popular said in a bourse filing.

Until such time they can be used as collateral to raise liquidity from the European Central Bank.

The bonds, rated A- by Fitch and A3 by Moody's, pay a coupon based on the 3-month Euribor plus 150 basis points.

Marfin Popular passed the European Union stress test last month, with a Tier 1 ratio of 7.1 percent under the simulation's worst scenario.