Euro

Polish bank mBank is embarking on a roadshow to market the first euro denominated international public bond from the CEEMEA region in over a month, and the first since Turkey’s currency crisis triggered a wave of selling across emerging market debt.

Chinese bond issuers were the first out of the gate on Thursday, vying for investors’ attention after public holidays in many parts of Asia shut markets on Wednesday.

KommuneKredit took a careful approach to its first benchmark deal since losing its triple-A rating with S&P. It found a good reception after starting with a wider initial pricing level.

It’s been a turbulent summer in emerging markets, but borrowers in the Middle East in particular are already eyeing their return to the market.

European corporate bond market participants are enviously looking at their counterparts in the financial and SSA sectors as supply started to flow again in those areas this week. There is no sign yet of any corporate bond issuers returning from the summer hiatus, but investors have clear ideas about what they want.

KommuneKredit hit the screens on Tuesday for a new five year euro benchmark, hoping to emulate the success of the European Stability Mechanism’s deal in the same currency and maturity in July.

The Federal State of Berlin’s new 20 year bond on Tuesday was almost three times oversubscribed, as investors took advantage of the hefty pick up over Bunds.

Greece is expected to return to the bond market before the end of the year, after it exited its third bailout programme on Monday, August 20. But the sovereign needs the ‘perfect’ window amid emerging and peripheral market volatility, said bankers.

Bankers in the investment grade corporate bond market are already looking towards the last week of August for the next corporate bond deal after the market failed to deliver a single new issue last week. But that was no surprise for market participants.

Concerns over the upcoming budget from Italy’s populist government — as well as the months’ long economic crisis in Turkey — took its toll on government bond yields in the eurozone periphery this week. But a hunt for safe assets among investors did play into the hands of top tier credits.

World Bank is looking to issue more deals in euros in its fiscal year, ahead of large redemptions in the currency.

The collapse in the Turkish lira has stoked fears as to how the nation’s borrowers will repay their foreign currency debt just as the country's foreign exchange reserves are shrinking.