Floating rate notes seem to be the new issue instruments of choice for sovereigns and supranationals this week with Spain issuing a benchmark three year of between Eu1bn and Eu3bn and the European Investment Bank a Eu1bn 7.5 year at Euribor plus 27bp, which is designated a retail/co-operative bond. Guidance on Spain has been revised from Euribor flat to Euribor flat to less 5bp as books already exceeded Eu2.5bn by mid-morning and bankers expect the tight end of the range to be achieved.
On the sterling front, the UK linker will be priced tomorrow, and the lead managers hope it will reach £2bn-£3bn. No price guidance yet but market participants are still expecting it to come flat to the outstanding 2037 inflation-linked Gilt.
Read EuroWeek on Friday for coverage of all the week’s SSA new issue business
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