SFEF talked 20bp wide of Cades after Ireland pays up

Ireland kicked off the expected avalanche of sovereign debt this week with a Eu4bn three year bond priced at least 20bp over Ireland’s curve at plus 25bp. That is a necessary margin, say bankers, to generate demand in these tough markets but where does that leave the new French agency, Societe de Financement de l’Economie Francaise (SFEF), which is roadshowing its debut bond this week? Early price talk suggested a three year at mid-swaps flat to less 5bp, just a small premium to Cades, but the current thinking is that the Eu3bn deal will have to price at least 10bp to 15bp over and even then may have to depend heavily on French domestic buying. Launch is expected on November 12. Read Friday’s EuroWeek for coverage of the Irish deal and to get the market’s views on SFEF’s prospects.