BMO Capital Markets
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A slightly more hawkish than expected US Federal Open Market Committee meeting mid-week has nudged up US Treasury yields — bringing 10 year dollar issuance nearly within SSAs’ reach, said bankers. But in the meantime, SSA bankers are looking at the dollar pipeline with dismay. -
L-Bank has snuck in at the last possible moment before the end of a crucial US Federal Reserve meeting to raise $500m with a comfortably oversubscribed floater.
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Sibanye Gold, the South African gold miner, took the final step towards refinancing its acquisition of US platinum miner Stillwater on Tuesday, when it issued a $450m convertible bond.
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A hundred investors managing $1.8tr of assets have signed a letter calling on banks to say more about how they are managing the risk of climate change, and to publish a strategy saying how they support the goals of the Paris Agreement.
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US chicken processor Pilgrim’s Pride Corp plans to fund its £1bn buyout of UK peer Moy Park with cash in hand, an extension of its term loans, and a new debt issue to repay a JBS subordinated note.
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Public sector issuers navigated a choppy start to the week to print strong dollar trades, but some SSA bankers worry that the problems that brought that early volatility are far from resolved.
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Kommunalbanken made what bankers away from the trade described as an “excellent” choice of tenor with a dollar benchmark on Wednesday as it tightened pricing from guidance — something that not every issuer has been able to achieve in the currency over the last two weeks. Meanwhile, a Japanese issuer mandated for a trade that bankers expect to go well despite geopolitical tensions in Asia.
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Kommunalbanken will bring a dollar benchmark in a defensive tenor on Wednesday, which a banker on the deal said is the perfect product for investors amid rising geopolitical tensions. The trade also offers an attractive spread over US Treasuries, the banker added, despite a tightening in swap spreads — although other bankers said that tightening meant larger issuers should consider longer dated deals.
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Nederlandse Waterschapsbank on Thursday became the latest issuer to tap into a hot summer market for dollars, increasing a tap from its initial size while printing flat to its curve.
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Public sector issuers are taking advantage of strong summer conditions in the dollar market to bring green and arbitrage-style deals, with more issuance expected next week.
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The dollar market is grinding on throughout the summer, with public sector borrowers pushing out deals at the short end, although none have been in benchmark size this week. Two issuers launched transactions on Tuesday with a third slated to follow on Wednesday.
