Europe

Generali agreed to take a large stake in fellow Italian insurance company Cattolica this week. The deal includes plans for a €500m capital increase, which takes the pressure off Cattolica to boost its solvency position and means the firm will no longer seek to access the market for restricted tier one debt.

With record borrowing programmes to complete as result of the pandemic, there will be no traditional major lull in issuance during the summer for public sector borrowers, according to bankers.

Bagshaw heads to HSBC, Deutsche replaces him — Citi's Kemp retires — Karolev moves to JP Morgan

The Covid-19 outbreak has spurred at least one change for the better. Five banks have established dedicated ESG teams since the start of the pandemic to meet demand from clients committed to being more conscientious, writes David Rothnie.

OP Corporate Bank sold a new four year deal this week that set a new low for euro senior bond spreads during the coronavirus pandemic.

Speaking at a Treasury Committee hearing on Wednesday, Sir Robert Stheeman, chief executive of the UK’s Debt Management Office, said that he was not concerned about the Bank of England’s decision last week to slow down the pace of Gilt purchases until the end of the year.

Private debt blossomed after the last financial crisis, as European companies grew more sophisticated and sought to diversify their funding strategies away from bank loans and bond markets. But the coronavirus has highlighted its shortcomings, particularly around speed of execution. It may be hard to regain the momentum.

Wednesday evening proved a busy night for equity bock trades, despite wider sell-offs in secondary markets over fears of a second wave of Covid-19.

Bank bond spreads widened further on Thursday amid growing numbers of infections in Europe and the US. Deal arrangers say that issuers will need to be more careful about choosing the right issuance window as markets remain choppy.

The UK government showed this week that it plans to differ from the EU in its approach to banking regulation after Brexit. Divergence will begin with the minimum requirements for own funds and eligible liabilities (MREL), but a new consultation opens the way for further changes.

UK airline EasyJet has raised £418m of fresh capital to bolster its balance sheet after reporting a significant half year loss because of the impact of the Covid-19 global pandemic on its business.

The Black Lives Matter protests have propelled discussions about ethnic diversity in the UK’s financial sector, and companies are likely to face more pressure from employees, investors and the government.