Performance pressured as new jurisdictions jam guaranteed market

Forget about gentlemen’s agreements, it’s every issuer for themselves now as far as banks using the government guarantees are concerned. Sweden is the latest jurisdiction to come live in Europe with Swedbank pricing a Eu2bn three year and Bank of Ireland is following in the steps of Allied Irish and has announced that it will price a September 2010 deal. However, the underperformance of the recent AIB issue means that pricing will be wider and guidance is between 60bp and 70bp over mid-swaps. Meanwhile Holland, Spain and Portugal are earmarked for the very near future. To find out whether it all turns into a bloodbath, read EuroWeek this week.