Bank Nederlandse Gemeenten

Dutch agency Bank Nederlandse Gemeenten (BNG), is taking advantage of its low funding needs to ratchet in the pricing of new debt. The agency is within spitting distance of its annual funding target, expects to have to raise even less next year and is looking for keenly priced reverse enquiries.

The European Investment Bank and Republic of Austria are considering dollars deals this week, SSA Markets understands. The deals will test demand for more expensive names in dollars, after blow-outs from a pair of European agencies and a Canadian province last week, as ultra low swap levels squeeze spreads over Treasuries.

Bank Nederlandse Gemeenten was set to price a $2.25bn five year at the tight end of guidance on Thursday afternoon, marking another blow-out for a European agency in a market where investors are falling over themselves to buy high quality credits that offer a spread over US Treasuries.

Norway’s Kommunalbanken (KBN) sold a $1.25bn five year note on Wednesday, having started out with a $1bn no grow trade. The issuer faced overwhelming demand from investors and said the deal has re-priced its dollar curve. That spurred two more borrowers into mandating deals.

Tight swap spreads ticked even tighter on Friday, a day after the Federal Reserve unveiled QE3. The swap will make it hard for sub-Libor issuers to offer an attractive spread over Treasuries.

Several borrowers are working on dollar deals for as early as next week, SSA Markets understands. Dollars is set to be the go-to currency for benchmark issues in coming weeks. Tight swap spreads are putting investors off across the board but the central bank bid will support dollar deals.

Next week the issuance calendar looks less like a pipeline and more like a bunfight. The pressure’s on to get funded ahead of a messy September, and borrowers will be tempted to cram deals in. But they must be cautious.

Bank Nederlandse Gemeenten (BNG) priced a 10 year benchmark on Tuesday morning at a wider level than it sounded investors at a day before. The deal fell short of subscription but bankers believe investors will still welcome new issues.

Bank Nederlandse Gemeenten (BNG) is following hot on the heels of a blowout from Nederlandse Waterschapsbank (NWB), mandating four banks on Monday to run a 10 year euro trade. The leads will launch BNG’s benchmark on Tuesday morning.

It has seemed crazy that so many issuers were prepared to sit the summer out given the benign market conditions in recent weeks.

Bank Nederlandse Gemeenten (BNG) tapped its 2.375% five year Canadian Eurobond on Tuesday. This marks the start of further loonie activity according to bankers.

Nordic Investment Bank (NIB) priced a Nkr1bn ($.13bn) five year on Tuesday. However, SSA issuance in the currency has depleted this year as investor have chased yields moving from supranational to corporate issuers.