Banks enjoy tight pricing for capital in ‘momentum market’

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By Tyler Davies
28 May 2020

Commerzbank and Crédit Agricole this week showed that banks do not have to pay big premiums for subordinated paper, with investors regaining their appetite for risk during the coronavirus pandemic.

Investors have been piling back into bank credit across all asset classes, with sentiment improving as countries start to ease Covid-19 lockdown measures.

Senior spreads have on average moved 15bp tighter week on week, but tier two spreads have come in by as much as 29bp.

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