DZ Bank

The financial primary market paused on Wednesday. Despite euro borrowers enjoying oversubscribed order books this week, demand in the secondary market is lagging behind, as investors await further rises in yields.

The European Union completed another chunk from its Support to mitigate Unemployment Risks in an Emergency (SURE) funding programme on Tuesday, leaving the issuer with up to €13bn more to raise before the end of March.

Intesa Sanpaolo saved a couple of basis points with the sale of a new senior bond from its green issuance framework on Tuesday, compared to fair value on a conventional deal. The new issue came as markets remained on edge ahead of the European Central Bank’s next meeting.

The European Union on Monday finally mandated the banks to lead its second Support to Mitigate Unemployment Risks in an Emergency (SURE) transaction of the year.

FIG issuers are taking care to announce deals before opening order books this week, as they try and book their places in the market ahead of a tricky meeting for the European Central Bank on Thursday.

Bank of Ireland’s inaugural green bond attracted the largest financial senior book in euros this week, peaking at €2.5bn, as it offered investors a chance to pick up labelled paper at a shorter tenor and with plenty of spread.

Rating: A2/—

Münchener Hypothekenbank (MunHyp) and the Bank of Ireland sold their first euro green bonds on Wednesday, offering up 2bp-3bp of new issue premium to do so.

Sixt, the German car rental company, has refinanced a coronavirus pandemic crisis era loan, swapping out domestic state support for a fully commercial bank line as vaccinations provide growth hopes.

Hamburg Commercial Bank (HCB) returned to the senior preferred market for the first time in 21 months this week, extending its maturity curve as it works on finishing a multi-year transformation plan following its privatisation.

Belfius Bank and Santander found strong support among bank treasury investors in the euro market this week, helping them to print new preferred senior deals at very low yields.

CaixaBank and BayernLB were able to sail through fair value with green non-preferred senior deals this week, bucking a trend for rising new issue premiums in 2021. Bankers say a lack of supply is finally helping borrowers to exert more power over their pricing.