Citi
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US corporate bond issuers had the whip hand this week, as US Treasury rates fell, issuance was in short supply and redemptions filled investors’ pockets with cash.
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Public sector issuers that ventured into dollars this week were inundated with demand, allowing them to bring a series of oversubscribed deals in the short to medium part of the curve. Others are tipped to follow if conditions are stable next week — after a stormy afternoon of trading across credit markets on Thursday.
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The Province of British Columbia will make its Kangaroo debut on Friday, drawing strong demand from investors. The deal will round off a hot week for issuance for Kangaroos, during which the Asian Development Bank sold the largest such deal from a sovereign, supranational or agency in almost three years.
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Syndicate bankers hailed a return to form for senior debt this week, following a string of blowout deals. Given a week with no holidays to disrupt the market, financials reacted with gusto and printed around €12bn of senior debt, with investors stepping up to absorb the tide of issuance. -
Sovereigns stole the limelight in the euro market this week with Italy and Spain printing blowouts, but the focus will shift to the European Financial Stability Facility next week. The rescue agency sent out requests for proposals on Wednesday ahead of a benchmark deal for which it has the whole length of the curve open to it, according to syndicate bankers.
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The long end looked to be the sweet spot for a trio of FIG issuers this week, as BNP Paribas, Crédit Agricole and Citi all sold blowout 10 year deals. BNP Paribas and Crédit Agricole were the first to market and Citi followed suit with a bumper book on Thursday, despite the French duo’s deals widening in trading.
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Some swap execution facilities could face closure as they struggle to attract liquidity and trading volumes. Market participants are beginning to question what needs to occur for SEFs to survive in the new and evolving derivatives market structure, report Beth Shah and Daniel O’Leary.
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Westpac has priced the first dollar-denominated benchmark covered bond of 2014. On Wednesday the issuer opened books for a five year deal and a three year senior unsecured after mandating Bank of America Merrill Lynch, Citigroup, HSBC and JP Morgan.
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Glasstank, a subsidiary of Yioula Glassworks, successfully issued €185m of five year secured notes on Tuesday, demonstrating that even triple-C rated Greek bonds can be sold in the high yield boom of recent months.
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Risk weighting, credit ratings and the Dubai government itself have all been cited as contributing factors after the emirate’s sovereign wealth fund cut the size of its conventional bond offering in favour of a shorter dated sukuk.
