Fetching changes fails with SVNAuthenticationException due many svn:externals

We have projects, which make heavy use of svn:externals inside the same subversion repository. Before updating to a new buildserver we used hudson on ubuntu 12.04 and had no problems ever. Now switching to ubuntu 16.04.2 LTS and jenkins 2.60.2, we observe the following issue:

Whenever there is made a change to some library code, the first build after the change fails on jenkins, while jenkins tries to get the change history. The message is:
No changes for svn://localhost/projects/project1/mainproject/trunk since the previous build
No changes for svn://localhost/projects/project1/subproject1/trunk since the previous build
Using sole credentials <none> in realm ‘<svn://localhost:3690> 17f7f5c1-6bce-49a2-b114-55f687de97a3’
org.tmatesoft.svn.core.SVNAuthenticationException: svn: E170001: Authentication required for '17f7f5c1-6bce-49a2-b114-55f687de97a3'
at org.tmatesoft.svn.core.internal.wc.SVNErrorManager.error(SVNErrorManager.java:68)
at org.tmatesoft.svn.core.internal.wc.SVNErrorManager.error(SVNErrorManager.java:57)
at org.tmatesoft.svn.core.internal.io.svn.sasl.SVNSaslAuthenticator.createSaslClient(SVNSaslAuthenticator.java:318)
at org.tmatesoft.svn.core.internal.io.svn.sasl.SVNSaslAuthenticator.authenticate(SVNSaslAuthenticator.java:92)
at org.tmatesoft.svn.core.internal.io.svn.SVNConnection.authenticate(SVNConnection.java:198)
at org.tmatesoft.svn.core.internal.io.svn.SVNRepositoryImpl.authenticate(SVNRepositoryImpl.java:1296)
at org.tmatesoft.svn.core.internal.io.svn.SVNRepositoryImpl.openConnection(SVNRepositoryImpl.java:1274)
at org.tmatesoft.svn.core.internal.io.svn.SVNRepositoryImpl.getLatestRevision(SVNRepositoryImpl.java:172)
at org.tmatesoft.svn.core.internal.wc2.ng.SvnNgRepositoryAccess.getRevisionNumber(SvnNgRepositoryAccess.java:119)
at org.tmatesoft.svn.core.internal.wc2.SvnRepositoryAccess.getLocations(SvnRepositoryAccess.java:195)
at org.tmatesoft.svn.core.internal.wc2.ng.SvnNgRepositoryAccess.createRepositoryFor(SvnNgRepositoryAccess.java:46)
at org.tmatesoft.svn.core.internal.wc2.remote.SvnRemoteLog.run(SvnRemoteLog.java:160)
at org.tmatesoft.svn.core.internal.wc2.remote.SvnRemoteLog.run(SvnRemoteLog.java:35)
at org.tmatesoft.svn.core.internal.wc2.SvnOperationRunner.run(SvnOperationRunner.java:21)
at org.tmatesoft.svn.core.wc2.SvnOperationFactory.run(SvnOperationFactory.java:1235)
at org.tmatesoft.svn.core.wc2.SvnOperation.run(SvnOperation.java:294)
at org.tmatesoft.svn.core.wc.SVNLogClient.doLog(SVNLogClient.java:968)
at org.tmatesoft.svn.core.wc.SVNLogClient.doLog(SVNLogClient.java:873)
at hudson.scm.SubversionChangeLogBuilder.buildModule(SubversionChangeLogBuilder.java:194)
Caused: hudson.util.IOException2: revision check failed on svn://localhost/libraries/lib1/trunk
at hudson.scm.SubversionChangeLogBuilder.buildModule(SubversionChangeLogBuilder.java:208)
at hudson.scm.SubversionChangeLogBuilder.run(SubversionChangeLogBuilder.java:138)
at hudson.scm.SubversionSCM.calcChangeLog(SubversionSCM.java:730)
at hudson.scm.SubversionSCM.checkout(SubversionSCM.java:865)
at hudson.scm.SCM.checkout(SCM.java:495)
at hudson.model.AbstractProject.checkout(AbstractProject.java:1276)
at hudson.model.AbstractBuild$AbstractBuildExecution.defaultCheckout(AbstractBuild.java:560)
at jenkins.scm.SCMCheckoutStrategy.checkout(SCMCheckoutStrategy.java:86)
at hudson.model.AbstractBuild$AbstractBuildExecution.run(AbstractBuild.java:485)
at hudson.model.Run.execute(Run.java:1735)
at hudson.model.FreeStyleBuild.run(FreeStyleBuild.java:43)
at hudson.model.ResourceController.execute(ResourceController.java:97)
at hudson.model.Executor.run(Executor.java:405)
I managed to reproduce the error with a clean standalone repository in the hope, this gives a help to fix the problem. So here is, how to reproduce it (using the scripts attached):

• Step 1:
  Create an empty folder, change into that folder and run "build-svn-repo.sh"
  This will create a local svn repository and start an svnserve process on that repo.
• Step 2:
  Create a jenkins job. Important settings:
  Subversion url: svn://localhost/projects/project1/mainproject/trunk
  Credentials : user "jenkins" password "testit"
  Ignore externals must NOT be set
• Step 3:
  Manually run that job once (will pass)

• Step 4:
  Add some changes to the repository using script "touch-project.sh"

• Step 5:
  Manually run the job on jenkins again.
  It will fail with the exception

If you have any questions, please comment this issue...