Brexit

While a handful of loans were put on hold following the UK’s vote to leave the EU, several deals already in the market are braving the choppy waters, with leveraged loans the first in line for external shocks.

The flames of Brexit-inspired volatility licking around the corporate bond market this week were spectacularly extinguished by the deep pools of investor cash as market conditions snapped back in favour of investment grade companies, writes Ross Lancaster.

Bankers and lawyers have been grappling with likely consequences of the end of euro clearing in the City of London — specifically, will their trading floors have to follow clearing into the eurozone? The UK chief executive of one major French bank said that the firm had received differing legal advice on this point, and that it was a "crucial" question.

Syndicated loan documentation has been in the spotlight since the UK voted to leave the European Union, with some market participants asking whether Brexit-related clauses might be invoked to block deals, and others questioning the continued use of English common law.

The land grab for financial supremacy in Europe is under way. After the UK voted to leave the EU last week, rival financial centres are lining up to snatch business form London, and one of the early battlegrounds is clearing euro-denominated business. Dan Alderson reports.

A procession of blue-chip corporate and Yankee names re-opened the dollar market with jumbo deals this week as investors displayed a strong appetite for US high-grade paper.

The SSA market got back to business swiftly, if somewhat cautiously, this week, with taps and private placements (PPs) across core currencies coming quickly after the UK’s vote to leave the European Union. Although none of the trades were especially ambitious, their success has set a positive tone for the weeks to come.

The Euro private placement business will be relatively immune from Brexit volatility, said many bankers this week, although some see a small rise in pricing ahead.

Lloyds reopened the dollar market for European borrowers for the first time since the UK’s vote to leave the European Union last week, surprising market participants who thought the country’s banks would need longer to recover from 'Brexit'.

Those of us who stayed up to watch the Brexit television coverage knew that in a few hours’ time the June 24 trading session would go down in history. The mainstream media were inevitably obsessing about the post-Brexit collapse in sterling, but the credit markets were focused on the Markit iTraxx indices. Big moves were expected by market participants, and they weren’t disappointed.

A stronger picture is emerging for the eurozone periphery late in the week, after the region’s governments suffered a spike in yields in the immediate aftermath of the UK’s vote to leave the European Union.

After a freeze brought about by the UK’s Brexit vote, the European capital markets are thawing. While only a tap, the German State of Hesse has reopened public sector bond markets. Perhaps it was no coincidence that Frankfurt, in Hesse, is eager to raise its profile as an alternative for financial firms wanting to leave London.