Commerzbank

ArcelorMittal is an archetypal crossover credit, having been downgraded from investment grade to Ba1/BB+/BB+. The steelmaker’s ratings from Moody’s and Standard & Poor’s are on negative outlook.

Corporate credit spreads in Europe are about as tight as they have been in this economic cycle, yet this week’s new issues — including a rare issue from Robert Bosch — suggested investors are exercising discrimination.

Intesa Sanpaolo has signed a €75m agreement with the European Investment Bank to support trade between Greece and Italy.

The covered bond market had one of its busiest weeks this year as six borrowers from five countries raised €5bn. With outright yields continuing to decline, and investors scrambling to hit return targets, supply was slanted to the long end, where more yield was on offer. Even so, several deals offered coupons that set new lows.

If Germany is known for one thing, it is efficiency. No wonder then, that the sun came out just in time to shine on Commerzbank’s rooftop soiree at the bank’s Gresham Street offices last week.

Mediobanca was the sole covered bond issuer to put its head above the transaction parapet on Tuesday morning — the first deal following Mario Draghi’s speech on June 5. Offering a €750m five-year single-A trade to a supply-hungry market, the deal was priced at least 3bp through fair value, according to a lead banker on the deal — a clear signal that the periphery tightening story is not over yet.

Covered bonds maintained primary market momentum this week, but issuers adopted very different pricing strategies and delivered contrasting outcomes. The degree of hesitancy that had been evident in the run up to last week’s European Central Bank meeting disappeared with a robust bid returning for higher yielding bonds. In contrast, low beta deals that offered a negligible spread were only just subscribed.

Sixt, the German car rental company, returned to the bond market on Wednesday, building on the success of its €250m deal in May 2012.

Indonesia Eximbank has finalised allocations for its loan, increasing the size of the deal with the inclusion of a short-dated tranche that brought some rare lenders into the syndication.

Sandvik and Sixt both launched sub-benchmark bonds today, after Sandvik had roadshowed on Monday and Tuesday and Sixt had held a conference call with investors on Tuesday morning.

Sixt, the German car rental company, is set to return to the bond market tomorrow for a €200m to €250m issue, building on the success of its €250m deal in May 2012.

Vakifbank has launched its €500m bond to yield 3.65% — the tight end of guidance and inside its own dollar curve.