Europe

The Trump administration’s decision not to announce new sanctions against Russia on Monday is unlikely to be the end of the sanctions saga, with designations having been proven to be the US's most effective weapon against Russia.

KommuneKredit took a novel approach to its sterling issuance on Tuesday, adding a switch operation to print its largest ever new issue in the currency. Bankers believe other issuers may use the tactic.

KfW is set to follow a trio of euro trades in the seven year part of the euro curve last week with an April 2025 benchmark of its own, after mandating banks on Tuesday. Strong conditions mean the deal should receive a warm welcome, said bankers.

The US Treasury’s targeting of Rusal in its latest round of sanctions was far from the random hit that investors are claiming. The US has demonstrated its power over the dollar-based financial system — and it has no need to do further damage.

Bain Capital has begun pre-marketing for the Paris IPO of Autodis Group, the French distributor of spare vehicle parts, which it bought in October 2015.

Virginia-based GTT Communications launched a €1.7bn-equivalent package of leveraged loans this week, the first leg of funding for the acquisition of UK peer Interoute. The credits are well known, bankers said, but European investors have become more circumspect after overcoming a recent bout of volatility.

A paper by the parliamentary group of the CDU/CSU, the leading bloc in Germany’s government, has said that fund distribution from a proposed European Monetary Fund should be controlled by the eurozone’s national parliaments. Such a measure would all but nullify the point of creating the EMF — and be a dire signal for hopes of further eurozone integration.

Japanese telecoms group Softbank opened the week in the European high yield market with a multi-billion refinancing deal to redeem its old 2013 bonds — and delete a covenant that could get in the way of its flotation.

Zurich Insurance Company was more than five times subscribed for a $500m subordinated bond on Tuesday, pricing the bonds at what a banker close to the deal estimated was a minimal new issue premium.

Caisse Francaise De Financement Local (Caffil) found good demand for a €1.5bn 10 year with a final spread close to what it could have achieved before the covered bond purchase programme begun. The deal followed a €1bn five year from Commonwealth Bank of Australia (CBA).

Turkish real estate developer Ronesans Gayrimenkul Yatirim has set the tenor on its benchmark dollar bond at five years, and is expecting to print the note “as early as tomorrow”.

The Republic of Turkey nipped into the market on Monday afternoon to raise $2bn with an SEC registered bond, just days before presidential and parliamentary elections were called. While one EM investor called the issuing strategy unusual, a rival banker said it was a classic case of Turkish opportunism, adding that the higher yield paid is the reality of the market now.