Europe

The Swedish Financial Supervisory Authority (FSA) said on Wednesday that it would be "reasonable" for some profitable banks to go back to paying dividends from next year, so long as the economy recovers from pandemic restrictions.

Canal+ Polska, the Polish satellite TV network, has pulled its IPO on the Warsaw Stock Exchange, despite the strong momentum behind emerging market equities.

Finnish financial services group Sampo has begun cutting its stake in Nordea, one of the Nordic region’s biggest banks, following pressure from Elliott International, the activist hedge fund, to simplify its business.

The ease with which banks have been able to deploy retained covered bonds for repo funding with central banks has aggravated liquidity risks and undermined regulations that were designed to shore up liquidity management practices exposed as inadequate during the 2008 financial crisis.

The Bank of Japan has said that it will pay extra on reserves deposited by banks that become more cost efficient or that merge. A similar policy could well be introduced in Europe too, although perhaps with different aims.

US fast food chain Chick-fil-A has issued a $1.7bn US private placement, according to market sources, in what is widely regarded as one of the tightest deals sold since the outbreak of coronavirus. Arrangers in London are looking for similar companies in Europe that could be tempted to issue.

The European Union achieved an impressive result once again on Tuesday, raising €14bn for its Support to Mitigate Unemployment Risks in an Emergency (SURE) funding programme on Tuesday.

De Volksbank mandated joint leads on Tuesday for a 20 year soft bullet covered bond, building on the earlier successes of two other issuers that recently responded to investor demand for yield with deals in this same maturity.

Schroders, the global investment manager, is seeking to float a new investment trust on the London Stock Exchange, which will provide equity financing for UK mid and small-cap companies.

Apart from the UK, very few covered bond issuers have provided details on the proportion of loans in their cover pools that have been affected by payment holidays. Though covered bonds offer strong investor protection these safeguards risk being eroded.

Deutsche Lufthansa, the German flag carrier, has exploited the huge rally in equity markets in recent days by issuing a €600m convertible bond, which attracted orders from over 200 investors.

Crédit Agricole benefitted from brisk capital markets activity in the third quarter, its results on Tuesday showed, while it has also set up a private investment banking division for wealthy individuals and families.