BNP Paribas

Emmanuel Macron’s election as French president last weekend was the catalyst for a flood of revved up euro deals this week, with issuers and investors aiming at the long end of the curve as the biggest known political risk in Europe this year passed with a market-friendly outcome. Craig McGlashan reports.

Volatility late in the week failed to dampen a scorching few days of public sector dollar issuance, auguring well for more expected supply in the currency next week. Four issuers — some of which came this week to avoid other trades pencilled in for next week — were able to price deals at tight levels, with some coming through their curves.

Royal Bank of Scotland this week gave capital markets the clearest view yet of how banks are set to re-engage with the covered bond market as a staple source of financing, as the sector comes under pressure to wean itself off the special fundings schemes set up by the Bank of England and the European Central Bank.

Shares in Koninklijke VolkerWessels, the Dutch construction and engineering company, had risen 3.8% by lunchtime when they began trading in Amsterdam on Friday, after the company's €575m IPO had been priced at €23 a share.

European banks piled back into the bond market this week following Emmanuel Macron’s victory in the French election and as reporting season passed its busiest point. Borrowers were looking to issue capital amid attractive funding conditions for senior paper eligible for total loss-absorbing capacity (TLAC).

Public sector borrowers in the euro market on Thursday focused their attentions on the long end of the curve, but not every trade made it to full subscription.

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Rabobank has mandated leads to take its debut covered bond on the road. Covered bonds will improve Rabobank’s net interest margin and help diversify its investor base, the bank’s global head of long term funding, Sjaak-Jan Baars, told GlobalCapital.

South Korea’s Woori Bank sealed its third Basel III additional tier one deal on Monday, raising $500m just before the country held its long-awaited presidential election.

WuXi BioLogics, which is planning a $200m-$300m IPO in Hong Kong, is set to begin investor education next week if the stock exchange grants it approval at a listing hearing on May 15, said a banker close to the deal.

Bright Scholar Education Holdings had covered its $150m US IPO as of Monday, according to bankers arranging the deal.

Hong Kong developer Cheung Kong Property Holdings (CKP) and Chinese company Huachen Energy Co both opened books for new dollar deals on Thursday.