The Royal Bank of Canada (RBC) looks set to enter the U.S. covered bond market following the green light given by the Securities and Exchange Commission (SEC) last Friday.

The SEC published a “no action” letter on Friday that means that RBC can now sell covered bonds into the U.S. market as a normal public offering of securities.

According to several market reports, the no action letter is the first step toward allowing covered bonds to be registered in the U.S.

Foreign banks have previously sold these bonds, but deals have been in the 144A market, a Financial Times report indicated.  

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