ESM-EFSF

In the last year that sovereigns, supranationals and agencies could enjoy the effects of the European Central Bank’s quantitative easing programme — but still had to cope with the Fed pushing up rates — GlobalCapital’s SSA team used its editorial judgement, with inspiration from GC’s world-famous bond comments and patented BondMarker app, to pick what it felt were the top trades of the year. The team strove to find deals that were not just the biggest — it looked for trades that set pricing markers, were innovative and brave or that made an impression in other ways. GC presents the winners here. Congratulations to the issuers and banks involved.

This week's funding scorecard looks at the progress of Europe's supranationals and agencies as the year comes to a close. Some of the issuers have also set their funding targets for 2019.

The European Stability Mechanism has softened the eligibility criteria for its precautionary credit lines, under a eurozone reform package sealed by the European Union on Tuesday.

Portugal extended its duration with a bond exchange on Wednesday, exchanging two bonds maturing in 2020 and 2021 for taps of bonds maturing in 2023 and 2027.

The European Stability Mechanism has softened the eligibility criteria for its precautionary credit lines under a eurozone reform package sealed by the European Union on Tuesday.

The EU moved a step forward on its tortuous path towards completing its Banking Union on Monday night. Finance ministers agreed on some details relating to a backstop for the fund for resolving banks, but have not yet shown any sign of agreeing on a common deposit insurance scheme.

Public sector borrowers are gearing themselves for wider spreads and bigger new issue premiums in the euro market in 2019 following the expected end of the European Central Bank’s public sector purchase programme. The bigger and more liquid names will determine the environment for the rest of the market, according to SSA bankers.

Sister issuers the European Stability Mechanism and the European Financial Stability Facility will raise a combined volume that is €13.5bn less next year than their 2018 target.

A dollar benchmark from Rentenbank scored comfortably higher than a euro trade from the European Financial Stability Facility in the latest BondMarker results. That is in keeping with a few weeks where the dollar market has been far more resilient than a wobbly euro sector.

Secondary spreads in the euro public sector market have widened heavily across the curve with just over a month to go before the European Central Bank is expected to put an end to its Public Sector Purchase Programme. SSAs are also being affected by the political ructions from Italy, Brexit and the global trade war, said bankers.

Rating: Aa1/AA/AA

The European Financial Stability Facility finished off its 2018 issuance this week with what was likely the last jumbo euro benchmark of the year. The deal was solid, but SSA bankers warned the euro market feels “tired”.