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Latest News
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PMM: Investors more selective in crowded market
The primary market was lively last week ahead of last Thursday’s European Central Bank meeting. Total issuance across the four markets that PMM reports on — SSA, covered bonds, FIG and corporate bonds — was double the previous week's total at almost $60bn-equivalent. The glut of supply afforded investors the ability to be picky and widening spreads in GlobalCapital’s data suggests that they are drawn to higher yields and green labels.
15 Jun 2021 -
Rates confidence improves as EU clears hurdle
Confidence in the rates and covered bond secondary markets improved on Tuesday in the wake of a strong performance in the EU’s debut Next Gen deal, despite an initial wobble when the deal weighed in at €20bn, which was larger than expected.
15 Jun 2021 -
TSB extends with Sonia covered bond as CIBC lines up
TSB Bank attracted good demand for its Sonia-linked covered bond on Tuesday, pushing out along the curve with a rare seven year that sufficiently differentiates from central bank liquidity. The extraordinarily strong sterling market conditions encouraged Canadian Imperial Bank of Commerce to follow Bank of Nova Scotia and mandate leads for another five year Sonia offering.
15 Jun 2021 -
BNS issues largest Sonia covered bond as TSB mandates
Bank of Nova Scotia (BNS) priced the first Sonia-linked Canadian covered bond in well over a year and the largest ever issued by any bank since 2014 on Monday, as TSB mandated leads to roadshow another Sonia linked covered bond.
14 Jun 2021 -
Spread stability in secondary rates market ahead of EU test
An ECB meeting on Thursday that delivered what traders had predicted meant there was little volatility in the rates market that afternoon. With a glut of supply about to come from the EU, one trader predicted spread tightening may follow the bellwether trade.
11 Jun 2021 -
UK must avoid the EU’s Taxonomy gaffes
Does the world need another taxonomy of what is green?
10 Jun 2021 -
UK to be torn between harmony and leadership on green regulation
The UK has begun the process of creating its own versions of the European Union’s sustainable finance regulations, by picking a Green Technical Advisory Group to help it draft a green taxonomy. It will face two conflicting priorities: to maximise harmonisation by staying close to EU rules; and to depart from them, for a variety of reasons including the possibility of improving on the EU’s approach.
10 Jun 2021 -
First GBP update since 2018 calls for holistic disclosure
The Green and Social Bond Principles organisation published the first new version of the Green Bond Principles since 2018 on Thursday. It strengthens the recommendations that issuers publish a bond framework and obtain an external review, and encourages issuers to communicate about their organisation-wide sustainability efforts, not just the assets linked to the labelled bond.
10 Jun 2021 -
Covereds wobble as sensitivity on display
Covered bonds issued this week by SCBC and Bank of New Zealand were thinly oversubscribed and illustrated that investors are still sensitive to price, albeit that demand was good for a small green debut from Eika Boligkreditt and a tap from Oma Savings Bank.
10 Jun 2021 -
Moody’s covered bond RFC bodes well for Swiss structures
Moody’s has published a request for comment regarding a proposed change in its rating methodology that could improve the rating stability of Swiss structured covered bonds. This could in turn give regulators another reason to consider updating the country’s legal framework.
10 Jun 2021 -
Promise of ‘greenium’ pushes FIG ESG supply to record pace
Banks have already printed more green bonds this year than they sold in the whole of 2020 and the momentum in issuance is showing no sign of slowing. Borrowers are increasingly interested in labelling subordinated debt, amid growing evidence that such products can offer even more pricing power.
10 Jun 2021 -
Renewed ECB buying and supply drip to keep squeeze on covered bond spreads
The European Central Bank bought fewer covered bonds in May than it did in any month this year so far but its portfolio still grow and may do so by even more in June. With supply still likely to be limited, this should keep prospective spread widening contained ahead of a supply glut in the sovereign, supranational and agency sector.
09 Jun 2021 -
BMO follows others with covered bond Sonia conversion
Bank of Montreal is seeking investor consent to switch from referencing Libor to Sonia on its sterling covered bond, following similar moves from other borrowers. Different calculation methods are emerging for the transition.
08 Jun 2021 -
PMM: Challenging conditions advance green revolution
Issuance seized up across most markets last week with lower rated FIG and corporate deals staying clear of the primary market as many participants struggled with a combination of low subscriptions and tight spreads. Subscriptions remain deflated but concessions fell across the board as increased selectivity led to more focus on green/sustainable labels.
08 Jun 2021 -
BNZ mimics Westpac with thinly subscribed covered bond
Bank of New Zealand (BNZ) priced an €850m seven year covered bond on Tuesday in line with the bid side of Westpac New Zealand’s deal in the same size and tenor issued last week. Although the order book was thinly subscribed, lead managers deemed the quality of orders high.
08 Jun 2021
