BMO Capital Markets
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Investors piled into KfW’s first dollar benchmark in six months on Tuesday, allowing the issuer to break the order book record for SSA dollar benchmarks. -
KfW mandated banks on Monday for a highly anticipated return to the dollar market following its previous benchmark in the currency back in January. The German agency will be joined in dollars by the Asian Development Bank, which is preparing a three year trade.
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The European Bank for Reconstruction and Development raised some eyebrows with an aggressive spread for its three year dollar benchmark, but the issuer was able to pull in enough demand to print $500m more than anticipated.
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The European Bank for Reconstruction and Development (EBRD) hit screens with a $1bn three year on Monday.
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Three SSA borrowers hit the dollar market on Tuesday. The Inter-American Development Bank raised $4bn with a five year while Kommunalbanken tested the waters at 10 years. The World Bank joined them with a small but impressive bond linked to Sofr.
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Kommunalbanken is looking to take advantage of the hot demand in the long end of the dollar curve, while the Inter-American Development Bank has chosen a more common maturity in the belly of the curve.
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The European Investment Bank raised $5bn with a three year global benchmark on Tuesday, setting the stage for fellow SSA borrowers to tap the dollar market later in the week.
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The Asian Infrastructure Investment Bank returned to the primary market for its second ever benchmark this week, raising $3bn close to fair value and debuting its new sustainable development bond branding.
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The Asian Infrastructure Investment Bank grabbed $3bn of five year paper on Wednesday, selling its first sustainable development bond. It was joined in the market by a 10 year dollar trade from Nederlandse Waterschapsbank.
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Belgium took advantage of more attractive funding conditions in dollars versus euros and strong demand at the 10 year point of the curve to sell its first dollar bond since 2017 on Tuesday. SSA supply in dollars will continue on Wednesday with the Asian Infrastructure Investment Bank and Nederlandse Waterschapsbank bringing socially responsible deals.
