Europe

Co-operative Bank managed to raise £200m of tier two capital this week, in its first bond sale since coming close to failing in 2017. A healthy coupon of 9.5% helped the UK lender to find the demand it needed, even if one investor said that there was still “not much to like” about its credit profile.

The Financial Conduct Authority has set out plans to amend the UK’s regulated covered bond framework once European Union legislation comes into force.

A surge in shareholder activism is providing banks with a lucrative new source of revenue, but they have to tread carefully or risk losing treasured corporate relationships, writes David Rothnie.

The European Central Bank has indicated that it is looking into how to mitigate the direct costs that years of negative rates have put on banks, and analysts are growing concerned that a tiered interest rate system might be put in place.

The calls have started to emerge for Turkey to turn to the IMF. Turkish president Recep Tayyip Erdoğan has always been dead set against the idea — and perhaps that’s for the best.

FTSE Russell is reviewing China for a potential upgrade under its framework for index eligibility, opening the door for onshore bonds’ inclusion in the FTSE World Government Bond Index (WGBI).

Investors have resisted the temptation to pile into new subordinated bonds from lesser known banks in recent weeks, fuelling expectations that funds will remain prudent in the market, even as it becomes harder for them to find high yielding assets.

Neil Garrod, group treasury director at Vodafone and one of the best known figures in the European corporate bond market, is understood to be leaving the UK mobile phone group. He is in talks with another company about becoming its finance chief.

Equity markets have recovered much of their swagger in 2019, with the S&P 500 almost completely clawing back losses from the worst sell-off since the financial crisis.

CLO anchor investor Norinchukin Bank is said to be looking at a full calendar of deals in the next two months, leaving some managers not on the Japanese bank’s list planning to revive structures not seen since before the last crisis in a bid to drum up interest and improve the arbitrage function of their CLOs.

UBS has reorganised its debt capital markets business, following the decision of global head Amir Hoveyda to step down from his role. It will merge leveraged finance and DCM, with David Slade heading the combined group in EMEA.

Auchan, the French supermarket chain, issued its second bond of the year on Tuesday, but the first since Standard & Poor's downgraded it in March to BBB-, leaving it on a negative outlook, after a weaker than expected trading performance in 2018.