CEE Bonds
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Sovereigns find exceptional issuance window but market still fragile -
CEE sovereign prints bring hope of better times ahead in primary market
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Books topped $6bn for latest bond
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Lowest new issue premium from a CEE borrower paid since Ukraine invasion
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Swathe of other emerging market credits to follow
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Hungary also wants to make its green bonds a darker shade of green
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Emerging market corporate bonds have rallied, but investors cannot find paper to buy in illiquid market
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Context and market conditions are always important when considering the merits of any new issue, but this was particularly the case in 2022, given how volatile markets were. Every CEEMEA issuer had to pay a high all-in price to get their deal away, and new issue premiums varied between issuers. EM issuers faced the toughest conditions in many years during 2022. The Russian invasion pushed investors to flee from riskier assets. The war had practical effects too: disruption to energy and food supplies sent inflation soaring and the resulting interest rate rises meant borrowing costs jumped sharply for CEEMEA issuers. New issue volumes dropped from 2021, particularly among CEEMEA corporates. By George Collard and Oliver West.
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More debut issuers are expected in 2023, but the Ukraine war could deter buyers
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After a calamitous year in EM bonds, market participants are wary of predicting how the next 12 months could play out. Few foresaw the war in Ukraine — and even fewer the Covid pandemic, which influenced volumes for the two previous years. But there is some hope of normalisation in 2023, as GlobalCapital’s poll of bankers and investors shows. By Francesca Young.
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After a year of war, rate rises, inflation and political pressures on the CEEMEA region, fixed income markets have been badly shaken. Citi and JP Morgan’s vice-like grip on the top of the primary market league tables remains, though others have been forced to question their commitment to the emerging market bond markets. Francesca Young reports.
