Europe

Sir Jon Cunliffe, deputy governor for financial stability at the Bank of England, this week outlined the risks the UK will face once it breaks from the European Union. Foremost is the uncertainty of the relationship after the divorce.

Three new high yield issues were launched into marketing in Europe on Tuesday, including a pay-if-you-can bond, even though the market was a bit weaker after President Donald Trump’s sabre-rattling about raising trade tariffs on China.

Turkey’s national election board has cancelled the results of the Istanbul mayoral race that president Recep Tayyip Erdoğan’s ruling party lost in March and ordered a rerun. This is widely thought of internationally as a blow to democracy, and in Istanbul citizens have taken to the streets in protest. But Erdoğan’s behaviour has been so unpredictable in the past year that there is hope the rerun in June will be free and fair enough for investors to breathe easy. It seems a bet made more in hope than expectation.

The formal separation of FinecoBank, the Italian online brokerage, from UniCredit has begun with Italy’s biggest bank selling almost half stake to institutional investors via an equity block trade – a strategy UniCredit has used numerous times in the past to shed non-core assets under its CEO Jean-Pierre Mustier.

Equity investors are too complacent about the prospects of the wheels coming off of trade talks between China and the US. Such optimism could wreck equity capital markets for the year if negotiations sour,

Ireland appointed banks on Tuesday for its second syndicated bond of the year, which will extend its euro benchmark curve to 2050 (31 years).

The City of Hanover is returning to the Schuldschein market with a dual tranche, long dated deal, around a year after it became the first city to issue a green Schuldschein.

The UK Debt Management Office has chosen the tenor for the first syndication of its 2019/20 financial year, which is expected to come in the week commencing May 13.

Caisse des Dépôts et Consignations (CDC) is planning to print its sustainable bond debut later this year, with a second benchmark of 2019 likely to follow shortly.

Abanca Corporación Bancaria will add its name to the growing list of debut covered bond issuers after mandating leads on Tuesday for a roadshow.

Santander UK, Sparebank 1 Boligkreditt (Spabol) and Erste Group were able to price flat or through their covered bond curves on Tuesday after stoking up hefty demand for their new issues.

Equity capital markets bankers are pitching aggressively for any new business they can get, often disregarding issuer region or the size of the deal, to make up for the dearth of supply so far in 2019.