EIB

The European Investment Bank and KfW added to the glut of dollar benchmark supply on Tuesday with new benchmark trades.

The European Investment Bank and Republic of Austria are considering dollars deals this week, SSA Markets understands. The deals will test demand for more expensive names in dollars, after blow-outs from a pair of European agencies and a Canadian province last week, as ultra low swap levels squeeze spreads over Treasuries.

The European Investment Bank (EIB) and the World Bank both jumped into the Russian rouble market on Wednesday to capitalise on the recent strong flows of non-domestic demand for high quality SSA names in the high yielding currency.

The European Investment Bank (EIB) attracted €4.5bn of orders to a 10 year deal on Tuesday afternoon, having announced guidance at a wider level than it had sounded investors at the day before.

The European Investment Bank became the first issuer to stick its head above the parapet this week, mandating banks for a 10 year euro benchmark. The deal will be a key test of demand in the 10 year part of the curve, where several deals in the last month have underwhelmed.

Several borrowers are working on dollar deals for as early as next week, SSA Markets understands. Dollars is set to be the go-to currency for benchmark issues in coming weeks. Tight swap spreads are putting investors off across the board but the central bank bid will support dollar deals.

The European Investment Bank (EIB) capitalised on additional investor demand to increase its Russian rouble 7.5% July 2019 line to Rb2.5bn ($75.4m) on Friday last week ― the second increase in two days.

The European Investment Bank (EIB) on Thursday seized the opportunity to increase its Russian rouble 7.5% 2019s to Rb1.75bn ($54m) based on strong international demand for one of the few emerging market currencies still providing yields high enough to entice investors.

The EIB rounded off a busy week in the SSA euro market on Friday with a €250m tap of its FRN January 2019s. Bankers expect further dollar and euro issuance next week despite potentially volatile markets.

Nordic Investment Bank (NIB) issued a new 20 year Swedish Krona bond on Tuesday, answering cash rich investors desperate to invest. However, bankers do not expect many SSA borrowers to answer the plea for new bonds.

Next week the issuance calendar looks less like a pipeline and more like a bunfight. The pressure’s on to get funded ahead of a messy September, and borrowers will be tempted to cram deals in. But they must be cautious.

Several borrowers are lining up benchmarks despite a decline in investor sentiment this week. Issuers face a choice between risking potentially tough conditions and overcrowding to get funding done ahead of September — a month they fear could be a disaster — or waiting.