CEE Bonds

An overhaul of the Polish covered bond law will increase issuance, market participants say. The reforms should raise loan-to-value limits, allow soft bullets, and mandate minimum overcollateralisation, according to an English translation of the text obtained by GlobalCapital's sister publication The Cover.

Despite European commercial paper dealers' high hopes of issuance from Russian banks at the end of last year the market has been shut to the borrowers this year. But domestic investors are keeping a close eye on the market and the banks could begin to reappear, according to CP bankers.

Slovenia shaved another few basis points off its euro curve with a €2bn dual tranche bond issue this week. The sovereign’s well timed transactions in dollars and euros have helped some of its existing notes rally by almost 10 cash points in just two months, reflecting investors’ increasing confidence in Slovenia.

Czech investors are craving corporate privately placed bonds. Volkswagen Financial Services took advantage of the interest to reopen the market, selling the first MTN private placement from a corporate issuer in Czech koruna since 2012.

International Personal Finance issued a €300m senior unsecured high yield bond deal in an intraday sale on Tuesday, after a roadshow last week.

After finishing last year at the top of the CEEMEA bond bookrunner league tables, Deutsche Bank has slipped to eighth position in Dealogic’s ranking for the first quarter of this year.

Slovenia drew almost €10bn of orders for a long three year and seven year euro bond issue on Tuesday, which catered to investors comfortable with duration and those more concerned about rates.

Kazakhstan Temir Zholy, the national rail company of Kazakhstan, held a one day fixed income roadshow in Switzerland on Friday March 24. A bond issue from KTZ in Swiss francs would be the first in the currency from Kazakhstan.

The CEEMEA market on Friday was in the strongest shape it has been in for several weeks, with an IMF agreement for Ukraine helping calm concerns about market volatility. Some analysts are reporting rising inflows from global investors into the EM asset class, and with debt bankers predicting a busy April looming, the timing could not be better.

The European corporate bond market had already seen plenty of fireworks by Wednesday but there was no let-up on Thursday.

The international response to Crimea has been decided. All that remains is a few brief months of playfighting, with weak politics and even weaker sanctions.

mBank, Commerzbank's Polish unit, issued a €500m five year bond this week, in a deal that successfully struck a balance between emerging market and investment grade specialists. The issuer trades too tight for some emerging market accounts and is not a natural choice for investment grade buyers but drew enough demand from both groups to price an oversubscribed bond with only a minimal new issue premium.