Bankers always say that — like estate agents, they rely on keeping transactions flowing.
But this time, it turns out they were right.
Before they were right, they were wrong, of course. Conditions for issuers just kept getting easier. Deals were getting done on Fridays with no discernible drop in book sizes. Multi-tranche deals got larger and the market digested them faster.
Lazy issuers got books as big and spreads as tight as those who had worked hard to make sure they only had to dot the I’s and cross the T’s on their deals when their debt capital markets bankers called.
The banks kept warning. Volatility was on the horizon. The end of quantitative easing would not be a time for wise issuers to play catch-up on their funding plans. They should be getting all their documentation and sign-offs ready, so they could issue before summer 2018 and not risk a taper tantrum in the fourth quarter.
Issuers had heard it all before. They’d been hearing it for two years. They had been rushed into deals before, then seen rivals save an extra 5bp by waiting another fortnight. So this time they would wait.
Only now, the wolf has leapt over the wall and into the sheep pen. Issuance windows are definitely back. Two days here, one day there. New issue premiums are fat — sometimes 20bp is not enough.
The early movers this week did well. The slower movers struggled and Bertelsmann failed. Eventually, the banker who cries wolf is worth listening to.