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Covered and senior unsecured bonds may not be the flavour of the day for Germany’s financial institutions, but a host of rival funding alternatives, including shrinking balance sheets, shedding bad assets, and shoring up tier one capital, are taking their place. Elliot Wilson reports on an industry that’s self-financing and self-reliant, but one that is exploring new forms of financing.

The three pillar system of German banking helped the sector ride out the financial crisis and disastrous experiments with securitization mostly unscathed. It’s the envy of Europe and the continent is scrambling to mimic it. So why, asks Andrew Griffin, are bankers in the country growing tired of it?

Germany’s document-light form of private debt placement, the Schuldschein, has been deeply rooted in the German market for years. The market opened up slowly to Austria and Switzerland — on both the investor and issuer sides. But recently a much more international audience has caught the bug. Stefanie Linhardt asks what attraction the product holds, and why issuance is not growing faster, when demand is so strong.

German agencies and regions enjoyed their status as safe haven borrowers during the eurozone debt crisis. But as investors start to buy eurozone periphery debt again, many of the German credits are looking expensive in comparison, while the sumptuous dollar arbitrage opportunities of the last few years have dwindled. Craig McGlashan reports.

It did not need an escalation of tensions between Russia and the EU to remind investors that there is no safer haven in the eurozone than Germany in general, and German public sector issuers in particular. Just when some analysts were starting to question how much lower German government bond yields could or should fall, the Crimean referendum pulled them down to a new seven month low. Looking to the longer term, however, with GDP growth gathering momentum in Germany, and with many economists expecting a tightening of US monetary policy, are German Bund yields at or near the bottom? This was one of the questions discussed by participants at this year’s German public sector issuers roundtable, which was hosted by the Finanzagentur in Frankfurt in March.

With redemptions set to exceed issuance for a year or two longer, Pfandbrief spreads are expected to remain tight. But as regulatory uncertainty dissipates, both mortgage and public sector backed supply should begin to take off again. Could this be the start of a new era for this, the most revered and established of all covered bond sectors? Bill Thornhill reports.

Five years on from the depths of the financial crisis, Germany’s Mittelstand has transformed the way it finances itself, embracing the bond markets and changing the way it works with its bank lenders. Nina Flitman reviews the evolution of the sector, and looks ahead to what its next steps may be.

Thanks to Basel III, bank treasuries have emerged as crucial investors in sovereign debt. But new moves down the yield curve in search of better returns and the freedom to hold almost unlimited quantities of the domestic sovereign’s paper — even if not zero risk-weighted — alarm some players, while second-tier SSA credits are suffering for their exclusion from the regulators’ top category. Julian Lewis reports.

Despite the improving economic environment in the US and Europe reducing the momentum of the flight to quality supranationals enjoyed during the eurozone sovereign debt crisis, the issuers are still meeting strong demand this year. The recovery brings a fresh set of opportunities — and some challenges — for this sector.

Deficit reduction is on many a sovereign issuer’s mind. After the crisis years and a spate of new regulations, the SSA market may be looking at a future of lower new issuance and possibly fewer dealers. But there should be no shortage of investors queuing up to buy what supply remains. Craig McGlashan reports.

A sensational start to the year for peripheral eurozone borrowers has given funding officials breathing space to think about life beyond the crisis. First up for sovereigns is extending maturity profiles scythed short by a flurry of crisis-induced short dated paper. Fortunately, issuers have plenty of tools at their disposal. Craig McGlashan reports.

Green bonds are the hot new product for SSA issuers to have in their repertoire. They make for a great press release — but what are they really doing for issuers’ funding programmes? As Jon Hay discovers, green bonds have been a great seller, but the big win is pricking many an investor out of apathy and getting them to think about environmental investing.