Europe

Covered bond investors wasted little time in placing big orders on Tuesday for the largest ever green deal issued in Swedish kronor — a five year floating rate transaction secured on energy efficient mortgages from Sparebank 1 Boligkreditt (Spabol). At the same time, Credit Mutuel Arkéa issued a long 10 year with blow-out demand, reflecting a material concern that covered bond supply, net of central bank purchases and redemptions, will be deeply negative this year.

The New Development Bank is looking to take advantage of the strong demand in dollars by bringing its long-awaited inaugural trade in the currency as part of its response to the coronavirus pandemic.

The Republic of Estonia has mandated for a 10 year benchmark bond, as it prepares for its first foray into bond markets since 2002.

The European Commission has ratified the €100bn Support to mitigate Unemployment Risks in an Emergency (SURE) fund and the European Union debt office has confirmed that it will be responsible for financing loans made under the new programme.

Banque Fédérative du Crédit Mutuel tested appetite on Tuesday for a 10 year non-preferred senior deal, with supply in the asset class having slowed to a near standstill during the coronavirus pandemic.

Investors have poured in orders on the first official day of book building for the Amsterdam IPO of coffee company JDE Peet’s. The company built early momentum with several big cornerstone orders and has continued to attract strong demand from investors because of the strength of its business despite the Covid-19 pandemic.

The European Banking Authority warned this week that lenders could struggle with asset quality problems for years as a result of Covid-19, publishing the findings in its first sensitivity analysis of the EU banking sector.

The head of the Cyprus public debt management office believes that the amount Cyprus can claim under the ESM pandemic support facility “is insufficient to justify any such action”.

Metals and mining company Vedanta Resources is seeking a bridge loan of $2bn to $2.5bn to take its India-listed subsidiary private.

A quartet of SSAs borrowed a combined A$940m ($613.4m) into the Kangaroo market this week, spurring the SSA Aussie dollar market on to its best monthly volume in over nine months.

Lloyds Banking Group has become the latest financial institution to extend the life of an additional tier one capital instrument (AT1), after arguing on Friday that it would be "uneconomic" for it to refinance its €750m 6.375% notes amid the stress of the coronavirus pandemic.

Cyprus may become the first country to access the ESM’s pandemic support line, borrowing 2% of its GDP for up to 10 years.