Europe

The huge swathe of dividend cuts UK companies have made because of lockdown has created an opportunity, to issue equity capital, for those that have not stopped returning money to their owners.

HSBC Holdings has launched a tender offer for nine short-dated senior securities in dollars as it looks to optimise its liability structure for the total loss-absorbing capacity (TLAC) requirements. The announcement followed a dual-tranche senior deal in the same currency.

Institutional investors holding Hammerson’s £689m ($900.27m) of private placements (PPs) are to be offered a pre-payment option first after the UK property company’s intended rights issue, according to a prospectus on the upcoming trade. Unlike the UK property company’s bondholders and bank lenders, during their coronavirus amendment process, PP investors negotiated an offer of pre-payment at par of 30% of any proceeds of capital raises or disposals.

European banks will be subject to some of the Federal Reserve’s highest capital targets, after the US regulator switched to using stress test results as the main input for its requirements.

Barclays is building up sustainability coverage in its investment bank with new positions announced globally on Monday and effective immediately.

Governments around the world face heavier than usual borrowing requirements and, with the market for syndications all but shut for summer, they have leaned more heavily than usual on the auction calendar.

French banks have been among the most active issuers of covered bonds so far this year but, with the pace of mortgage origination expected to slow and deposit inflows rising, further supply is less certain with pre-funding for next year becoming an option with doubts over the longevity of the prevailing strong market conditions.

Local lenders in central and eastern Europe have stepped up for local clients during the coronavirus pandemic. Structural factors will help them fortify their position against international banks should infections rise again.

Energias de Portugal, Portugal’s largest utility, closed its cash call in Lisbon on Friday with 93.8% of shareholders taking up their rights. However, the company attracted demand worth 256% of the €1bn offering. Market watchers hope the result augurs well for Spanish telecoms operator Cellnex's rights issue on Thursday.

FIG deal arrangers say the euro market could reopen for business as early as next week, with more investors set to return from their holidays.

The outlook for bank credit ratings deteriorated more sharply in Europe than in any other region over the first six months of 2020, according to Fitch.

Carnival Cruises has completed a partial buy-back of the $2bn three-year convertible bond it issued in April, to give it extra liquidity during the Covid-19 pandemic.