BBVA

BBVA priced a well oversubscribed €1.25bn seven year with barely any new issue concession and a long way through the Kingdom of Spain’s spread.

Cemex tightened its latest deal by over 50bp from initial price thoughts as the Mexican cement company was rewarded for a conservative starting strategy with a well-oversubscribed book.

Fomento Económico Mexicano (Femsa) has mandated three banks for its debut euro denominated bond, which it will roadshow next week around the European Central Bank policy meeting.

Not all emerging markets bond bankers may agree with the strategy — with certain deal-hungry New York dealers particularly vociferous in their opposition — but Latin American sovereigns are placing increasing faith in the euro market for their international funding, writes Oliver West.

The Republic of Peru could become the third Latin America sovereign to issue in euros in 2016 after holding an investor call at 10.30am UK time on Monday.

Concerns over the exodus of real money investors from the covered bond market were put to rest this week as a series of deals met exceptionally strong demand, with the sea change in sentiment being most conspicuous in the French sector.

Argentina’s government reopened negotiations with holdout creditors on Monday after securing a $5bn loan from seven global banks last week.

BBVA

A trio of Spanish issuers launched the first covered bonds of the year from southern Europe this week but, with peripheral spreads widening sharply, conditions are not conducive to further supply.

Financial institutions have taken an early plunge into additional tier one bonds this week, as European and US investors show willing to take on risk and put cash to work.

BBVA, BFCM and BPCE met with strong investor demand for euro senior unsecured deals on Monday, as peripheral and longer dated debt proved no deterrent to buyers.

After three consecutive years of record volumes, in 2015 Latin American bond market momentum was halted by crises in Brazil and plunging commodity prices. Though volatility will continue and issuers and investors often struggle to meet on price, the market looks mature enough for a modest recovery in 2016. Oliver West reports.