France

Covered bonds issued this week by Compagnie de Financement Foncier (CFF), ABN Amro and ING Bank offered premiums well in excess of any other seen this year. The three deals repriced the secondary market and set a pattern that is likely to become more established over time.

France tapped its Green OAT on Thursday for the third time, raising €1.096bn.

FIG bankers said that Société Générale had started with ‘aggressive’ price thoughts for a new dollar-denominated additional tier one deal on Wednesday, as the French bank looked to raise capital ahead of an upcoming call date.

Despite a turbulent market backdrop on Tuesday, Compagnie de Financement Foncier (CFF) took advantage of the fresh money that is usually put to work at the start of each quarter to issue a defensive €1.5bn covered bond with a ‘very generous’ starting spread.

Caisse Française de Financement Local (Caffil) plans to issue its first social covered bond this year and, along with La Banque Postable (LBP), it is considering a debut green deal in 2019. Deutsche Pfandbriefbank (PBB) has green assets to fund but is biding its time. These issuers and other key market participants spoke of their sustainable finance plans in the Crédit Agricole CIB covered bond roundtable.

French consulting company Capgemini wasted no time after the Easter break in announcing a new dual-tranche corporate bond issue on Tuesday. The benchmark tranches had 6.5 year and 10 year tenors and were announced alongside a tender offer, but the issuer had to pay a significant premium to its secondary curve.

Rating: Aa2/AA/AA

Volatility from several sources has driven investors into core govvie products, causing curves to rally. Only one issuer was positioned to reap the benefits.

France’s inflation linked bond issue on Wednesday drew the nation's largest book ever for a linker bond, in spite of a curve squeezed tight by volatility.

France announced on Tuesday that it will come to market for an 18 year inflation linked benchmark, making the most of a pre-Easter lull in issuance.

Michelin, the French tyre maker, has got a £1.2bn bridge loan underwritten and arranged by Morgan Stanley to finance its purchase of UK industrial belting manufacturer Fenner.

Europe’s corporate bond new issue market is distinctly subdued as Easter Week begins. Investors, issuers and banks alike feel the market could do with a gap to digest the very heavy issuance earlier this month. This week brought two liability management deals, one with a new issue.