Euro

KfW announces ‘rather unusual’ euro dual trancher after revealing large programme last month

Sovereign cuts issuance by €60bn but market readies for another year of hefty SSA issuance

Dexia sets sights on largest volume in two years as Bpifrance weighs greater presence in niche currencies and PPs

The bank's plan to issue a seven year covered bond sets the stage for likely head to head execution with LBBW

Issuance could include heavier focus on public sterling, Norwegian krone, Australian dollar and Swiss franc markets

The seven year Pfandbrief will offer the longest covered bond for more than four months

SSAs weigh up more pre-funding next year

French, German and Dutch banks are forecasted to print a combined benchmark volume of around €75bn, with 2024 looking like another year of positive net supply

French agency aims to diversify currency mix via benchmarks and PPs, and execute euro taps

In a year dominated by the collapse and takeover of Credit Suisse, financial institutions were keen to re‑establish investor confidence in some of the riskier asset classes. Axa led the way just weeks after the CS rescue with a €1bn subordinated bond. In the autumn, UBS made a bold statement about the stability of Swiss bank capital as it returned to AT1 issuance with two $1.75bn tranches. Elsewhere, banks dealt with tricky conditions and pulled off some skilfully timed transactions, underlining the market’s faith in mainstream currencies and emphasising the appeal of ESG labels

Covered bond benchmark issuance in euros had reached €175bn by early November 2023, suggesting the market was on track to reach €185bn for the year — somewhat less than 2022’s record of a little over €200bn. Although gross volumes are expected to decline a little in 2024, they are likely to remain well above average and, in the absence of central bank support, further pressure on spreads is expected.

Financial institutions’ funding requirements point to a busy start to their bond sales in 2024. But, as Atanas Dinov reports, banks may need to compete for attention not only with other financial credits but with the broader fixed income universe, as we reveal the results of our FIG market survey