DZ Bank

The State of Brandenburg will keep the primary euro public sector bond market ticking on Tuesday after mandating banks for a new 20 year bond for which it hopes to achieve a better outcome than Berlin's deal at the tenor last week.

Erste Abwicklungsanstalt (EAA) is considering a return to the euro market in the fourth quarter to complete its funding programme.

Niedersachsen Invest GmbH, the financing vehicle 100% guaranteed by the State of Lower Saxony with a policy mission for the recapitalisation and long-term restructuring of NordLB, received a strong reception from investors for its debut bond on Monday.

NRW.Bank’s inaugural social bond sparked a flurry of 15 year trades this week as a flattening French curve and the positive yields on offer helped spur on demand, with three issuers opting to follow the German agency’s successful trip to the maturity on Wednesday.

Syndicate bankers are scrambling to make sense of the covered bond market, where sentiment has been changeable in recent weeks. Amid volatility and small issuance windows, sustainable bonds have proven a safe strategy to ensure successful deals.

The 15 year tenor is the flavour of the week in the SSA market. Three issuers have mandated for deals at the tenor so far, following on from NRW.Bank’s successful trip to the maturity on Tuesday.

Berlin Hyp left ‘a little bit on the table’ with its new green covered bond on Tuesday. The trade was followed by deal announcements from Kookmin Bank and Sparebank Vest Boligkreditt, both looking to issue in sustainable format.

NN Bank unveiled plans on Monday to issue its first covered bond from its newly published soft-bullet programme. At the same time, Berlin Hyp has mandated lead managers for the sale of a new green covered bond.

Gunvor, the Swiss commodity trader, has signed a €450m sustainability-linked facility, pushing its environmental, social and governance-linked bank lines signed this year up to almost €1.1bn-equivalent.

DZ Hyp managed to attract a healthy order book for a €1bn eight year deal issued on Wednesday, a day before a more narrowly subscribed €1bn 10 year from UniCredit’s German subsidiary, HVB.

Green bonds made up the majority of the supply in the euro bank bond market on Thursday, with Hypo Noe and Santander capitalising on strong demand for the asset class.

DZ Hyp managed to raise €1bn of eight year Pfandbrief funding flat to its curve on Wednesday. The deal contrasted with one from Axa Banque SFH, which paid a much larger premium for a €500m 15 year, possibly due to far higher French supply this year and confusion with Axa Banque Europe SCF, which has already entered the market four times this year.