ABN Amro

The Reserve Bank of New Zealand will prevent its financial institutions from redeeming subordinated bonds during the coronavirus pandemic, putting itself in contrast with other parts of the world, where banks remain free to manage their debt capital as they see fit.

The primary corporate bond market in Europe threw up another blistering day on Wednesday, with seven issuers on screens by mid-morning, bringing the number of deals so far this week to 18, though bond syndicate desks are hesitant to compare this crisis market with the record-breaking issuance in 2009.

Market participants are debating whether the risks to additional tier one coupons have risen or fallen after the European Central Bank urged banks not to pay equity dividends for at least six months.

Another derivatives strategy has fallen foul of volatile trading conditions, as ABN Amro on Thursday declared a $200m net loss as a result of the blow-out of a client’s positions.

European banks are steering well clear of new issue markets during the coronavirus pandemic, avoiding having to call on investors for funding by taking advantage of attractive central bank funding schemes.

Aareal Bank has become the latest European financial institution to extend the life of an additional tier one instrument, as turbulent market conditions make it harder for banks to decide how to manage their capital structures.

Banks are delaying their plans to raise funding in the euro market, as credit spreads drifted wider on news about the spread of the Covid-19 coronavirus.

Marel, the Icelandic company that makes food processing equipment, has signed a €700m revolving credit facility, becoming the latest investment grade borrower to switch its bank debt to a sustainability-linked structure.

Conditions for issuance in the additional tier one market may be more attractive than ever, but there’s still good reason for some bank treasury teams to bide their time.

Argenta Spaarbank returned to the euro market on Wednesday to seal a deal that it had pulled in last October. This time around the issuer was able to bring in the funding it wanted, even though the final spread only moved 5bp from initial price thoughts.

Denmark's Torm has signed $496m of bank loans, as new regulations affecting the global shipping industry take hold.

Indian companies Birla Carbon and Tata Steel have mandated banks for loans and both borrowers have signed up large groups of lenders at the top level.