Europe

Additional tier one bonds looked to be back in fashion this week when BBVA found success for its fifth euro deal ahead of a busy redemption calendar, and HSBC came to the end of its huge 2018 funding run in the format by entering its home market for the first time.

The highly anticipated IPO of Aston Martin has entered its final stages as bookrunners opened the books and a set a pricing range that values the carmaker at over £5bn at the top. Within a day, the deal was covered.

KfW was able to achieve a well oversubscribed book and tight pricing for its 10 year euro benchmark on Thursday, despite a steep sell-off in the issuer’s secondary curve.

The deal drought in French equity capital markets may soon be over after Neoen, one of the largest renewable energy companies in Europe, filed to go public on Thursday.

Experts in the derivatives clearing market have been debating numerous elements of the default management process of Nasdaq Clearing, after a clearing member blew a €114m hole in the institution following a bad trade last week. Costas Mourselas reports.

Since the return of the corporate bond market in late August after its summer break, weekly issuance volumes have been fairly consistent. Within that though there have been a number of days without issuance and some days have been busy. Thursday was the busiest yet with six new deals pricing.

Deutsche Pfandbriefbank (PBB) this week attracted greater demand than Aareal Bank for its December 2021 sterling Pfandbrief, even though it was priced at the same spread and had a lower credit rating. Both deals had a lot of German demand reflecting a sterling’s pick-up to euros.

US firm Global Infrastructure Partners (GIP) took on bank loans totaling around £1.65bn to part finance its acquisition of half a wind farm off the UK coast, with the rest of the debt raised coming from private placements.

ING Belgium's order book for a €1bn eight year issued on Thursday was larger than any for a covered bond of this size since January. The exceptionally strong bid is something that other issuers will look to take advantage of before Eurosystem purchases are scaled back again.

Having said that it would raise $5bn-$7bn of additional tier one paper this year, HSBC was set to hit this target by selling its first ever issue in its home market on Thursday.

Fédération des Caisses Desjardins du Quebec (CCDJ) was able to take €1bn of funding out of the euro market on Thursday. Meanwhile, Royal Bank of Canada is expected to bring the first senior bond under Canada’s next bail-in regime next week.

SpareBank 1 Østlandet is launching its second issue of euro senior debt in a matter of months, as the bank looks to rebalance more of its funding into the currency.