CEE Bonds

After a week of no new paper in CEEMEA, EM bankers are looking forward to a busier next week as four bonds are slated from the region and the market looks supportive enough to allow issuers to pull the trigger.

Turkey’s sovereign curve widened between 5bp–10bp on Thursday after expectations that Turkey’s prime minister Ahmet Davutoglu will step down, though bankers said the asset class was holding up versus equities at least.

It’s been a sour few days for European equities — the Euro Stoxx 50 has lost 5.4% in three and a half days of continuous falls. With a big cohort of IPOs having been priced last week, the new issue market now enters a new phase, and will be looking for signals as to how receptive investors are.

Slovenia is offering a $750m buy-back across its dollar 2022s, 2023s and 2024s and is looking to fund it with proceeds from a new euro-denominated bond.

Turkey this week chose to take its second chunk of funding this year via a tap to double the $1.5bn it raised with a 10 year in March.

Black Sea Trade and Development (BSTDB) made its dollar debut on Thursday, printing $500m in 144A/Reg S format.

Vakifbank’s debut euro Turkish covered bond is good for investors, good for emerging markets borrowers and good for the global economy. But the deal would probably never have happened without the intervention of the European Central Bank.

Türkiye Vakiflar Bankasi, or VakifBank, this week issued the first publicly syndicated Turkish covered bond, sending a powerful message to other Turkish banks and emerging market issuers that the investor base is wide open and eager for more EM names.

Evraz has bought back $184.4m of outstanding Eurobonds that were due in 2017 and 2018, joining a band of several Russian issuers which have been buying back dollar debt.

Peripheral banks led a charge for capital this week, resurrecting some long-awaited trades and putting risk appetite through its paces.

Bank Gospodarstwa Krajowego (BGK), Poland's state development bank, on Thursday printed a €500m 10 year bond — its debut foray into the international bond markets — with leads building a €800m book for the note.

With so much attention on whether the UK will vote to leave the EU on June 23, there is a distinct chance of underestimating political risks developing within Europe itself.