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Tightening absolute and relative valuations have raised some concerns, but FIG assets remain in vogue thanks to higher rates
◆ Simultaneous execution with Alphabet's record deal bodes well for others ◆ More FIG names likely to print in near future ◆ Other European banks diversify funding in Singaporean and Australian dollars
Diverse US senior FIG issuance jostles with perpetual and tier two capital from foreign and domestic banks
Data
Funding across all parts of the capital structure is available with issuers likely to prioritise unsecured borrowing
With masses to fund and spreads super-tight, banks will race to market, but central banks are expected to tighten
Banks could rush to issue as fast as possible, taking advantage of remarkably tight spreads
Growing pipeline and fiercer competition had threatened to shake the darling bonds of May
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The Eurogroup made no progress towards creating a common EU debt instrument on Tuesday night, but member states will be able to fund their responses to the coronavirus crisis through a new credit line with the European Stability Mechanism. -
Industrial and Commercial Bank of China (ICBC) has received the nod to head offshore for capital, at a time when most of its peers have been tapping the liquid domestic market for funds.
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The UK government’s offer on Friday to pay 80% of the wages of furloughed workers came in the nick of time to save thousands of jobs in manufacturing and services. But few of those affected realised they were benefiting from a German idea. The move highlights how the coronavirus crisis is causing a rapid dissemination of techniques around the world.
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BPCE took advantage of the improvement in credit sentiment to issue a €1bn five year covered bond on Tuesday. The deal attracted a granular order book and was priced close to where it would have been expected to come in light of recent Canadian deals — 20bp above theoretical fair value.
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Intrum’s share price dropped sharply this week after short seller Muddy Waters disclosed it was betting against the firm’s stock price. The debt purchasing sector has been a popular target for short sellers for years, but the impact of coronavirus and associated measures is a further heavy blow.
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Bank of America has become the first financial institution to launch a new deal in the European credit market for over a month. The US lender paid a huge premium for its €1.5bn senior bond on Tuesday, but it was able to move past its initial price thoughts on the back of a solid set of orders from investors.
Polls and awards
The winning institutions and individuals will be revealed at the awards dinner on June 17 in London
Don't miss your chance to choose this year's Bond Award winners
The covered bond market gathered in Seville to celebrate its standout deals, institutions and individuals
Last chance to vote for the best winning deals, individuals and organisations in the covered bond market
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