ESM-EFSF
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A trio of public sector borrowers comfortably printed at the long end of the euro curve on Wednesday, but the deals suggested a slowdown in demand after a bumper April for the currency. -
A stream of SSA borrowers entered the primary bond market this week in both euros and dollars. Dual tranche deals were popular as borrowers sought to take size without paying heavy new issue premiums.
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A hungry euro market gorged on deals from France and the European Union on Tuesday, instilling confidence that a trio of trades on Wednesday’s menu will go well — despite two of them being in the same tenor.
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France is preparing its first dual tranche trade, targeting the 20 and 50 year parts of the curve, while bankers expect the European Stability Mechanism to aim for a shorter tenor this week.
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The European Investment Bank and the European Union kicked off April by printing impressive benchmark deals, yet despite this strong start to the quarter SSA bankers fear that a combination of the threat of a Brexit and the low yields on offer in the euro market will make conditions extremely challenging for issuers.
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European Investment Bank is expected to comfortably print a 10 year Earn on Tuesday, but bankers have expressed concern for the prospects of other issuers looking to sell deals in the currency as yields fall to near record lows.
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The City of Paris is set to follow deals from the European Stability Mechanism and SNCF Réseau last week by bringing a trade at the long end of the euro curve.
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Read on to discover the funding progress of European supranationals and agencies in 2016 so far.
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Will euros or dollars dominate SSA bond issuance in the second quarter? Debate over the direction of primary markets broke out this week with issuers scheming arbitrage trades in euros, while others believe the dollars will win out. Craig McGlashan reports.
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SNCF Réseau became the second SSA issuer of the week to target the long end of the euro curve, printing a €500m May 2037 on Wednesday.
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The European Stability Mechanism on Wednesday reduced its funding target for the second quarter of the year by €3bn, due to Cyprus’s imminent exit from its assistance programme and the issuance of Namensschuldverschreibungen (N-bonds).
