Europe

Financial institutions are set to spend the summer months monitoring conditions for issuance in order to continue funding this year or to frontload funding needs for next year, according to deal arrangers.

Krylyo Shevchenko, the chairman of state-run Ukrgasbank, has been selected as the new governor of the National Bank of Ukraine (NBU) after weeks of deliberation. The choice has elicited a mixed reaction from market spectators, some of whom hope that Ukraine can salvage its international debt market access and IMF funding. Mariam Meskin and Ross Lancaster report.

The European Commission’s best practice guidelines for the financial sector in handling the coronavirus crisis may challenge the safety mechanisms embedded in covered bonds, which have become fundamentally overvalued — especially in countries like Italy where payment holidays have been widely taken up — thereby instigating a sell recommendation from analysts at Barclays.

BMW Finance braved huge volatility in China’s bond market to sell a Rmb2.5bn ($357m) Panda bond this week, achieving a record coupon despite ballooning yields on domestic bonds. Rebecca Feng reports.

Sir Martin Sorrell’s S4 Capital has completed a £116m growth capital raising to fund further M&A opportunities.

The UK Debt Management Office outlined its borrowing plan for the period of September through to the end of November on Thursday, announcing that it plans to issue a minimum of two syndicated Gilts and 38 auctions during the period as its funding needs soar to unprecedented levels as a result of the coronavirus pandemic.

Energias de Portugal (EDP), Portugal’s largest utility company, is raising €1bn through a rights issue to acquire Spain’s Viesgo. Bankers expect it to be the first of a number of acquisition-related cash calls to be launched in Europe.

The Covid-19 pandemic is forcing many governments to expand their borrowing programmes. The table below details the impact of the outbreak on the funding requirements of major sovereign bond issuers.

Italy’s €178bn covered bond market comprises a wide variety of structural nuances that are likely to prove critical to understanding underlying risks, especially when it comes to the way swaps are used and the methodology for asset coverage (ACT) and amortisation tests (AMT), said Moody’s this week.

HSBC’s global head of ECM is under no illusions about the challenges the bank faces but says HSBC’s restructuring is not one of them. David Rothnie reports.

Nationwide Building Society put an end to a two year absence from the euro senior market this week, taking advantage of solid issuance conditions to bring in €1bn of new funding.

The European Union could use green bonds to finance a chunk of its proposed €750bn recovery fund in a move that would make it easily the largest supranational provider of green safe assets, said S&P on Wednesday.