Europe

Turkey has joined the list of emerging market countries experimenting with quantitative easing programmes in the wake of the Covid-19 crisis engulfing conventional funding markets.

The loans market has been one part of the capital markets that has perhaps unsurprisingly taken to working from home easier than most. Some loans bankers even see a world after the pandemic where one or two days a week working out of the office becomes the norm.

London-listed Russian steel firm Evraz has raised a syndicated loan with lenders honouring the pricing terms agreed before the outbreak of coronavirus that has wreaked havoc in markets.

Italy’s borrowing is set to increase as it attempts to weather the economic impact of coronavirus. But Davide Iacovoni, director general of the Italian public debt office, told GlobalCapital that he did not expect investors to abandon the country’s debt. He also called for some form of European risk sharing.

Some of the largest financial institutions in the eurozone have yet to cancel or postpone their dividend distributions for this year, despite explicit guidance from the European Central Bank urging them to restrict payouts during the coronavirus crisis.

HSBC has promoted two bankers internally to head up its capital markets business in the Middle East, North Africa and Turkey.

The Finnish Treasury said on Tuesday that it plans to increase its short-term borrowing to fund the government’s emergency fiscal package for the coronavirus outbreak.

Central banks are turning on the money taps and slashing rates in an effort to combat the economic effects of the coronavirus pandemic. The below table details the response to the outbreak from many of the world's largest central banks.

Whitbread, the UK hotel and restaurant company behind Premier Inn, has amended a clause in its debt documentation which could have left it liable for technical default. One source said several companies may have to go through a similar amendment process.

A leading covered bond investor has reacted positively to a series of measures announced by Canada’s Office of the Superintendent of Financial Institutions’ (OSFI) which have effectively provided stable access to emergency funding, including a temporary increase in the amount of covered bonds the country's banks can issue. The move comes after a heavy spell of supply that had sparked concerns that Canadian banks were struggling for cash.

Public bond investors in Europe received on Monday their first new issue from the car industry since the coronavirus crisis went global. The paper was not from an industrial company but Volkswagen Financial Services, its leasing division, which does not rely on VW producing new cars to repay its debt, but rather on customers who are legally obliged to keep paying their leases. The price was wide, but VWFS showed it had market access.

The dollar bond market is gradually opening up, with two high quality public sector borrowers hitting screens on Monday for short dated deals. But with volatility still gripping the cross-currency basis swap market, European borrowers are still sticking to their home currency.