CEE Bonds

The Slovak Republic is exploring the possibility of issuing a rare 50 year euro-denominated bond as markets stabilise after a tough week.

EPP, a Polish real estate investor specialising in shopping malls, has mandated banks for a euro bond, joining Atrium European Real Estate in the rush to issue the first non-financial corporate bond from CEE since early May.

The recovery of Turkish asset prices this week is less the result of prudent monetary policy — though that certainly helped — and more a lesson in the benefits of the personal touch and that markets are, ultimately, populated by humans.

Turkish dollar bonds outperformed in a heavy market this week after the Central Bank of the Republic of Turkey (CBRT) moved to simplify rates in order to protect the lira. The recovery of the lira to below TL4.5 to the dollar has been taken by the market to indicate that last week’s rate hike was a success.

The Panda bond pipeline is bursting at the seams with red chip Chinese names and SSAs preparing for renminbi deals, prompting some in the market to predict a new era of growth for the asset class.

Turkish assets have performed this week after a long period of weakness with two emerging markets portfolio managers saying that the worst of the volatility in the lira exchange rate may have passed.

Turkish dollar bonds outperformed in a heavy market on Tuesday after the Central Bank of the Republic of Turkey (TCMB) moved to simplify rates in order to protect the lira.

The Ministry of Finance of Georgia has started laying the groundwork for issuing its debut Panda bond in China, multiple sources have told GlobalRMB.

Turkey’s central bank stepped in on Wednesday to stem the collapse of its currency, delivering an emergency 300bp increase, but market commentators deemed the move too little, too late, saying investors' confidence in the bank remained impaired.

Bank Gospodarstwa Krajowego (BGK), Poland's state development bank, printed its dual tranche euro bond on Wednesday in a tough market that allowed for no tightening from initial price guidance and book that was only just covered.

Polish financial institution mBank has returned to the Swiss franc bond market. Like many sold in the past few weeks, the bonds were priced at the wider end of guidance — a sign that the market is returning to more conventional spread levels, and investors are expecting higher returns.

Conviction levels are low among emerging market investors with many waiting on the sidelines this week as geopolitical risk and local currency weakness persist in wreaking havoc on EM bonds.