Europe

Rating: Aa1/AA+

The UK government has filled one of the last gaps in its offer of financial help to companies struggling with effects of the coronavirus, by removing the cap of £500m revenue, which had barred many medium-sized companies from accessing government loans — raising the possibility that high yield bond issuers could tap loans for a variety of purposes.

The European Central Bank is creating a temporary forum to stimulate dialogue between the ECB, national central banks in the eurozone and the private sector on the proposed European Distribution of Debt Instruments (EDDI) project, which aims to create a one-stop synchronised platform for selling bonds across the bloc.

Swedish biotech company Getinge raised Skr1bn ($100m) of commercial paper off a new Covid-19 Financing Framework on Friday to it help meet increased demand for ventilators as a result of the coronavirus pandemic.

UBS has made Paul Mahony head of corporate debt capital markets and derivatives for Europe, the Middle East and Africa, following on from Barry Donlon’s appointment as head of DCM for the region.

Nexi, the Italian payments company, has sold a debut €500m convertible bond overnight with a simultaneous delta equity placement to circumvent the three month short-selling ban that has been imposed in Italy as a result of the Covid-19 pandemic, according to market sources.

This week's funding scorecard looks at the progress French agencies have made in their funding programmes by the middle of April.

Covered bond spreads have begun to stabilise with the help of European Central Bank secondary market purchases and a few bank investors. Although the market is still offered, secondary spreads are falling into line with where recent primary deals are trading. And, following the ECB’s decision to improve capital treatment of market risk, there are hopes bid side liquidity will improve.

The European Central Bank has been buying Italian government paper well above the pace indicated by the capital key, but has still struggled to keep the beleaguered sovereign’s spread to Bunds in check.

The European Central Bank is encouraging investment banks to keep up their market making activities during the coronavirus pandemic by offering them temporary relief on their capital requirements for market risk.

Having recently completed a series of investor meetings, and armed with an Aa1 rating from Moody's, Bluestep Bank will soon print the first Swedish covered bond secured on near-prime mortgages. The transaction emerges as aggressive quantitative easing by the Riksbank has resulted in a considerable tightening of covered bond spreads.

Governments in developed countries have rushed to introduce measures to support companies, large and small, battling with the effects of coronavirus lockdowns. But they are all doing it differently, throwing a spotlight on the relationships between public and private sectors in each country and inviting the question: which is the gold standard? Jon Hay, Silas Brown and Mariam Meskin report.