Europe

Stability of foreign currency funding is a priority for Sumitomo Mitsui Banking Corporation and covered bonds provide a new level of balance in this regard, according to the bank’s head of treasury. Since other borrowers in Japan are sure to be thinking along the same lines, the market for Japan's covered bond is likely to have tremendous scope for growth.

The Loan Market Association on Wednesday published a user guide for Schuldschein deals in a move that market participants said will make the market more approachable to international borrowers while maintaining its culture and standards.

Swedish Export Credit Corporation was set to price a $1bn no-grow three year global benchmark as GlobalCapital went to press on Wednesday, as the last bits of dollar supply came before an expected shutdown next week for the US mid-term elections.

Northern Gas Networks (NGN), the UK gas distribution company headquartered in Yorkshire, has sold £200m of US private placements notes, pricing at a tighter margin than what it could achieved from a sterling bond, said a US PP market participant.

The Netherlands plans to join the burgeoning list of sovereign green bond issuers and could become the first triple-A rated country in the group. Whether the bond will be via syndication or the country's preferred auction method has yet to be decided. Meanwhile, two of the country’s public sector SRI borrowers were busy in the format this week.

Australia and New Zealand Banking Group Limited has mandated leads for a roadshow with a view to issuing a covered bond, or senior unsecured transaction, or both. In the meantime, primary market activity is expected to slow this week and next allowing time for the recent slate of deals to be digested and for market sentiment to improve.

The privatisation of Kazatomprom, the Kazakh producer of natural uranium, moved ahead on Wednesday after bookrunners kicked off a marketing roadshow and set a price range for the listing.

On Wednesday, OP Corporate Bank announced tentative plans to issue a debut green bond, after a month of dire issuance volumes — the lowest October volume for euro-denominated bond sales from banks since the single currency was introduced.

Corporate debt investors have the jitters, with fears over a potential wave of defaults and low levels of recovery expected to materialise following a trend towards covenants that offer them ever less protection spreading from the leveraged finance world to the wider market.

The status of bonds used to meet banks’ minimum requirements for own funds and eligible liabilities (MREL) and issued under English law has become a hot topic in the face of Brexit uncertainty. But many in the market are sanguine about a solution being found and there are obstacles for investors seeking to speculate on the outcome.

A mix of political, economic and market forces is “shaping up to be a perfect storm” for the eurozone debt markets, investors have warned.

With the IPO market all but dead for the year, equity syndicate bankers will be looking to the blocks market for things to do, but large bouts of day-to-day volatility are making execution difficult.