Euro

Six of the nine investment grade corporate new issues in the last week of February were announced with a three letter acronym that, while providing clarity, served to frustrate investors keen to see greater volumes of issuance. WNG stands for “will not grow” and this week told investors that the meagre sized deals would not be increased, irrespective of demand.

The European Central Bank may find that when it stops its government bond buying programme, investors that left the sector to find higher yields may not return, according to a credit analyst on an SSA treasury team.

When the equity markets had a severe wobble in the first half of February, corporate bonds spreads widened, but only marginally compared the wild swings seen in the equity markets. Spreads are still at some of the lowest levels ever seen. Issuers would do well to remember that in coming months.

Finnish residential property developer Kojamo and French care home operator Orpea added to the geographical diversity of the property company corporate bonds sold this week with a €500m seven year deal, while frequent issuer RCI Banque sold a dual tranche offering

Slovenia printed €1.25bn by way of a triple tranche euro bond tap on Wednesday from a book of €4bn, paying small new issue premiums. Marjan Divjak, director general in Slovenia’s Ministry of Finance, said that the country is “more or less done” in the international bond markets for the year.

French commercial property company Carmila returned to the investment grade bond market after two years away and received a positive response from investors for its longest maturity to date.

Before 2017, US crowd services provider Equinix had not issued a bond in euros. But it has now visited the European high yield market three times, having completed its latest deal on Wednesday.

Books for the Republic of Slovenia’s triple tranche euro bond tap were in excess of €3.6bn by lunchtime on Wednesday, with final spreads having been set for each clip. The deal is part of a liability management exercise that swaps out short dated dollar debt for longer euro denominated paper.

Seven investment grade corporate deals in the first three days of this week kept investors busy doing their credit work, but the lack of new issue volume has left investors still hungry for more.

Three public sector borrowers hit screens in euros on Tuesday, taking advantage of a hot market to offer zero or limited new issue premiums.

Five new investment grade corporate bond deals were priced on Tuesday and, while pricing was competitive, none of the issuers allowed for any growth in the size of the deals as all five used a no-grow strategy.

Bank of China, Industrial and Commercial Bank of China and Industrial Bank Co have raised close to $3.7bn from eight fixed and floating rate tranches in three currencies. But most of the portions had to offer a new issue premium, which ranged from a few basis points to as much as 15bp.