France

La Banque Postale (LBP) managed to find good demand for a 10 year covered bond on Monday even though the spread to OATs has tightened and could become problematic.

Private equity firm PAI's divestment of its majority stake in Kiloutou, the French equipment rental firm, is pumping supply into the term loan market this week through a secondary buyout. Meanwhile, PAI is itself funding its leveraged buyout of Albéa, a French beauty product packaging group, with a high yield pay-if-you-can (PIYC) bond.

Public sector borrowers this week set new landmarks in what has already been an exemplary year in dollars, as KfW sold the largest 10 year dollar benchmark in 2.5 years and the Nordic Investment Bank priced the tightest deal versus swaps of 2018 so far. SSA bankers are confident that conditions will hold at both ends of the curve — allowing the possibility of further long end supply and even lower short end spreads.

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Syndicate desks and investors have been quietly voicing concerns about the lack of a firm pipeline in the corporate bond market. Going into the final week of the month, January volumes of new issuance are likely to come in under that registered in 2017, although a trio of French issuers did alleviate some of the pent up demand this week.

SNCF Réseau has hit screens for a 30 year bond to be sold this Friday. The borrower announced the mandate just after the completion of the European Central Bank's governing council meeting press conference on Thursday.

French video game publisher Ubisoft Entertainment sold its first corporate bond on Thursday following a roadshow earlier in the week. The meetings in Paris, London and Germany helped the publisher of games including Assassin’s Creed and Just Dance build a whole new following.

Corporate bond investors were treated to a relative feast of issuance on Wednesday following a meagre €850m of supply in the first two days of the week. A trio of higher beta names offered a variety of tenors and spreads for investors to choose from.

Representatives of eight central banks including those of France, China, Mexico and the UK are meeting in Paris this week for the first time, as part of a new initiative to share best practice on how to make the financial system greener.

Public sector borrowers wrapped up a trio of short end dollar trades on Tuesday, with the tightest issuer able to grind in pricing to the lowest level from an SSA this year and the higher yielding names finding ample demand despite ending up at similar spreads. SSA bankers are confident that the strong conditions will also ring true at the long end for KfW, which has mandated for its first 10 year dollar benchmark in nearly three years.

The European Financial Stability Facility (EFSF) has announced a dual tranche for its second trip to market for the year. The trade will come on the heels of a €1.4bn Agence Française de Développement (AFD) 10 year, which managed to cut 4bp from its spread between guidance and launch.