EIB

Transport for London (TfL) was set to print its first bond since 2006 on Thursday afternoon — a £500m 30 year print that the issuer was able to increase from the original minimum size of £300m.

The Kangaroo market is set to host a streak of deals from Washington supranationals as soon as next week. With these borrowers having just entered a new financial year, SSA supply having bounced back in the last two weeks and Kangaroo investors desperate to buy lower-yielding but safer assets detached from Europe, rumoured issuers including the International Financial Corp and the World Bank are primed for success if and when they decide to print Australian dollar paper.

The European Investment Bank (EIB) was the sole borrower to populate the Swiss franc market on Monday when it announced a Sfr25m ($26.3m) increase of a Sfr110m 1.5% 12 year line which it originally priced two weeks ago.

Spanish government bonds had widened 10-15bp across the curve on Friday afternoon, amid speculation that the sovereign will seek assistance for its banking sector from the European Union at the weekend. Meanwhile the European Investment Bank was the only issuer to provide primary supply with a long-dated tap.

Sovereign, supranational and agency issuance planning for 2012 lay in tatters after last week’s Eurogroup summit left issuers and their advisors riddled with uncertainty. Although funding volumes are known, plans of campaign are limited to taking a wait-and-see approach as issuers face up to increased scrutiny, wider spreads and smaller deal sizes.

Borrowers and their dealers are increasingly nervous about issuance in the first quarter of 2012 as faith in the ability of the European policymakers to reach an accord before the traditionally busy opening in January diminished ahead of the summit on Thursday.

Standard & Poor’s placed 15 eurozone sovereigns on CreditWatch with negative implications on Monday. Six of those countries, including Austria, Germany and the Netherlands, are rated triple-A.

Anything but euros worked for top-flight sovereign, supranational and agency issuers in the MTN market this week, as instability in both the banking and sovereign sectors rocked equity and CDS markets.

Sovereign supranational and agency Australian dollar supply and deal sizes suffered from unfavourable market conditions this week as worries over whether a second Greek bailout could be agreed helped to drive volatility and reduced domestic investor participation.

The EIB continued its run of Nordic currency-denominated supply with a tap of its 2017 Nkr bond yesterday. The deal is symptomatic of growing interest in high grade paper in those currencies, said bankers.

KfW printed a spate of large trades in dollars and sterling this week. Although the borrower is offering low levels at the short end, volatility surrounding the foreign exchange swap allowed investors to buy the borrower’s paper at more attractive levels.

Institutional investors focused on the long end of the Swiss franc curve this week ahead of upcoming sovereign, supranational and agency redemptions, which lead the European Investment Bank and Bank Nederlandse Gemeenten to tap well received outstanding deals.