Between 2000 and 2007 spreads on 3-5 year German covered bonds over German government securities have fluctuated around 20 basis points. In early 2009 spreads peaked at over 140. The announcement of the covered bond program led to a first drop in spreads (figure 7). With the implementation of the purchases, spreads have declined further.
Spreads between German covered bonds and covered bonds of other euro area countries, which have similarly increased over the course of the crisis, have equally come down recently. 9  12  See the monthly reports on the Eurosystem’s covered bond purchase program on the ECB’s website.