Euro

The State of North Rhine-Westphalia on Thursday brought the first 20 year euro benchmark of the year from a core eurozone issuer, for which leads said the “stars aligned”. A sell-off in rates, core SSAs stability in the face of wider market volatility and a healthy spread over OATs all helped the deal, they said.

Beni Stabili printed a “gutsy” investment grade corporate trade at the start of the week. The BBB- rated Italian firm managed to attract investors despite plenty of background noise, though bankers said it may send other prospective issuers mixed messages.

German car rental and leasing company Sixt sold just the second corporate bond issue of the week when it copied the format of its four previous deals, which the company has sold at two year intervals.

Spanish regional issuers are in discussions with the Autonomous Community of Madrid in an effort to add their names to the list of Spanish public sector SRI bond issuers.

ANZ raised €750m this week from its first bond aligned with the UN sustainable development goals (SDGs), marking only the second such deal globally.

The bond markets have been muted in their response to last week’s equity market volatility. Corporate bond investors did not suffer the heavy losses or wild intraday swings their equity peers had endured, leaving them to focus back on fundamentals.

The European Central Bank’s corporate sector purchase programme maintained its rate of purchasing in the first six weeks of 2018, which helped support spreads through the recent period of volatility in global markets.

The Autonomous Community of Madrid on Tuesday printed its largest ever sustainable bond — and its biggest bond of any kind in three years — with a trade that was double the size of its SRI debut last year. Bankers away from the trade hailed the “excellent” result, with one saying it was “probably as good a result as the issuer could have hoped for”.

Greece’s return to capital markets last week drew nothing but praise on the day, but its subsequent performance in the secondary market has left something to be desired, said bankers.

The Autonomous Community of Madrid is prepping its second ever sustainable benchmark, after mandating banks on Monday.

Rating: Caa2/B/B-

The corporate bond market has stayed away from the eye of this week’s equity market correction storm, so far. Despite the enhanced volatility, €5.75bn of corporate bonds were priced. While none of the nine tranches have given investors much performance yet, equally, none have yet really underperformed.