Europe

The secondary Schuldschein market, typically something of a backwater, has become a torrent of activity and is now busier than the product’s primary market, according to several sources, as banks rush to buy assets ahead of an ECB deadline for cheap funding on March 31. However, there are fewer banks deleveraging from their risk-weighted assets, and many more buyers than sellers.

The rise in US Treasury yields in reaction to the government's $1.9tr stimulus package has prompted a shift in equity markets away from highly valued tech stocks that may do less well if interest rates rise as a result of higher inflation. But if the switch means investor portfolios reflect the wider economy, that is a positive development.

Gilt-Edged Market Makers (GEMMs) and investors expressed their support for the UK Debt Management Office to issue a new 30 year Gilt as the first syndication of its new 2021/22 financial year.

The European Union completed another chunk from its Support to mitigate Unemployment Risks in an Emergency (SURE) funding programme on Tuesday, leaving the issuer with up to €13bn more to raise before the end of March.

Trading levels given are bid-side spreads versus mid-swaps and/or an underlying benchmark and bid-yields from the close of business on Monday, March 8. The source for secondary trading levels is ICE Data Services.

Davy, the Irish brokerage firm, has shut its bond desk with immediate effect following a damning investigation by the Central Bank of Ireland which found a group of employees breached markets regulation for personal financial again over a period of two years.

European equity deals linked to renewable energy have continued to come to market despite sustained turbulence buffeting the sector.

Turkish lender Akbank is in the syndicated loan market with its debut ESG deal, according to sources. The bank has been able to tighten pricing on the refinancing, meaning that it has enough competitively priced funding for it not to need to come to the bond market.

Oldenburgisch Landesbank priced its debut publicly distributed mortgage Pfandbrief on Tuesday, attracting enough demand to ensure the deal size was increased to the top end of the expected range, even as the spread was tightened. But a deterioration in market conditions was blamed for its low subscription ratio.

Intesa Sanpaolo saved a couple of basis points with the sale of a new senior bond from its green issuance framework on Tuesday, compared to fair value on a conventional deal. The new issue came as markets remained on edge ahead of the European Central Bank’s next meeting.

CaixaBank was well supported for the sale of a new €1bn tier two this week, becoming only the fourth European bank to issue a capital transaction in green format.

Rosatom, the Russian nuclear power company, is using a $300m sustainability-linked loan for part of the financing of Akkuyu, the first nuclear power plant to be built in Turkey — a sign of how fast and far the concept of sustainability-linked finance is spreading.