Free content

The euro SSA market has grown used to investors flush with cash, itching to buy anything that comes on screens with a good enough rating. But with the EU preparing to issue more than €850bn over the next few years, the balance will shift against issuers, and they must be prepared.

The syndicated loan market is facing a schism in the way it deals with the transition away from Libor — and unless the famously ponderous market starts to co-ordinate fast, fissures will keep appearing as different regions stick by their favoured replacement benchmark rates.

Investors have got a fever, and the only cure is more pharma. Biotech equity issuance is surging, in line with rising stock prices in the secondary market, as stock pickers pan for the company that will cure Covid-19, among other maladies. But this is more speculating than investing and many are going to catch a cold chasing around a risky sector that is starting to look a lot like the dot-com bubble.

When the European Parliament voted to approve the EU Taxonomy Regulation on June 18 — the final step in the Regulation’s legislative journey to providing the foundation for sustainable finance in Europe — more than just a glass was raised at the European Investment Bank. The issuer took the opportunity to issue a new Climate Awareness Bond (CAB) and announce the extension of CABs to two new project areas that substantially contribute to climate change mitigation.

Chinese food and beverage company Bright Food’s ability to court investors and push for a tight price for its euro-denominated bond shows the benefits ─ and downsides ─ of an aggressive approach to the euro market.

In this round-up, Beijing eases the cap for equity investment in insurance companies, the China Securities Regulatory Commission mulls consolidation, and the top financial regulators in Hong Kong tell the finance industry not to fret over the security law.

In this round-up, China’s GDP growth for the second quarter beats expectations by a large margin, the banking and insurance regulator asks financial institutions to step up efforts to eliminate the shadow banking sector, and a green-dedicated national fund is up and running in Shanghai.

In this round-up, the UK bars Huawei Technologies from its 5G mobile network, the Chinese foreign ministry retaliates against recent US sanctions, and Donald Trump signs an executive order that ends Hong Kong’s preferential trade treatment.

The Wirecard scandal — like other recent debacles such as NMC Health — shows that financial reporting, oversight and governance, as they are currently practised, are woefully inadequate.

It’s time to get the toughest deals done as market conditions are likely to deteriorate in the autumn, when a second coronavirus wave and a more material deterioration in banks’ balance sheets could knock sentiment.

Short sellers who for years have complained that BaFin, the German financial markets regulator, ignored their criticisms of Wirecard, the collapsed payments company, and instead prosecuted the critics, have begun to be vindicated with the news that the European Securities and Markets Authority (ESMA) has opened a review into the organisation. By Silas Brown.

The European Stability Mechanism was set up in 2012 as a backstop for euro area member states that were unable to access the capital markets during the eurozone sovereign debt crisis. GlobalCapital spoke to Siegfried Ruhl, the ESM’s head of funding and investor relations to see how the institution is once again looking to play a crucial role to support the bloc through its Pandemic Crisis Support credit lines and how this will be financed.