Euro

Industrial and Commercial Bank of China is set to become the first Mainland bank to sell a green bond aligned with both international standards and China’s framework.

Both investment grade corporate bond new issues on Wednesday came from French issuers. Surprisingly, Total issued its first euro bond of 2017, while PSA Banque France sold its second.

Bpifrance Financement has tapped a November 2024 line for €700m, outstripping the size of the original issue and selling into what a banker at one of the leads described as an “amazingly strong market”.

One borrower took advantage of an excellent backdrop to scoop up its first green funding in euros at an attractive level on Tuesday, while a second issuer is lining up to follow suit in dollars.

Tuesday proved to be hybrid day in the European corporate bond markets with Aroundtown tapping its dollar hybrid bond for €200m while German electric utility, RWE, announced it was tendering for up to €550m equivalent of its own equity-like debt.

US machinery manufacturer, John Deere, returned to the euro corporate bond market on Tuesday, selling its second deal in September. The €500m five year deal was issued by the company’s John Deere Bank entity.

Australian pallet and container provider Brambles must think good things come in threes. Having made euro investors wait three years for its last deal, in 2014, it finally returned to the single currency market on Tuesday, printing a deal with virtually no new issue premium.

Volkswagen Leasing brought its second euro corporate bond deal of 2017 on Monday. The €2.25bn dual tranche offering took Volkswagen’s total issuance this year to €17.25bn. This is more than twice as much as General Electric, the next highest issuer by volume.

Heineken used the quieter end of the week in terms of issuance to price its second benchmark corporate bond issue of the year. The sixth benchmark issue of the year in Europe by a beer producer was the only deal in the market on Friday.

Industrial and Commercial Bank of China is jumping on the green bandwagon, hiring firms to work on its inaugural green deal denominated in dollars and euros, to be sold through its Luxembourg branch.

This week started very strongly in the investment grade euro corporate bond market with nine tranches issued in the first two days. However, the rest of the week yielded just the one. Syndicate managers are not worried though about a lack of supply next week.

In September, a number of issuers have returned to the European corporate bond markets after a number of years without issuing. On Wednesday, German chemicals distributor Brenntag, Australian property company Goodman and Austrian steel company Voestalpine were the latest to join that list.