German Sovereign

Read on to see how selected benchmarks are faring in secondary. Trading levels given are bid-side spreads versus mid-swaps and/or an underlying benchmark as of Thursday's close. The source for secondary trading levels is Interactive Data.

German pension funds have joined Japanese investors hunting for long dated paper from sub-sovereigns, according to medium term note dealers. German regions are beginning to tap the demand and push further out the curve — State of Brandenburg is set to print a seven to 12 year note this month.

Norway’s Kommunalbanken is set to print its first euro benchmark bond this week, after mandating a group of banks on Monday for a €1bn no-grow five year deal.

Strong Asian demand helped the North Rhine-Westphalia increase the size of its first benchmark of the year on Wednesday, despite the issuer pricing the bond at the tight end of guidance.

This week's scorecard focuses on the funding programmes of selected German states and agencies. Next week's scorecard will feature French agencies.

A remarkable start to the year for the eurozone periphery is in clear view in this month's sovereign funding scorecard. Just two months into the year, Portugal has completed more than half of its target, while Ireland is not far behind. At the other end of the volume spectrum, Spain is making good headway in tackling its €133.3bn target with 26% completed, while Italy — which has yet to sell a syndication this year — is behind on 18%.

Several cities in Land Nordrhein-Westfalen banded together to sell one of the first joint deals from German cities on Thursday. The deal appealed to domestic and international investors and could inspire other cities in the country to access the public debt markets.

A pair of French regional issuers could soon join a German sub-sovereign in selling long dated private placements in yen. Japanese investors are keen to push along the curve in search of yield and look beyond their usual fodder of European agencies to large sub sovereign and regional issuers, SSA Markets understands.

The rampant start to 2014 by peripheral eurozone sovereigns is clear to see in this week's funding scorecard, with the region's comeback kids Ireland and Portugal halfway and a quarter way through their funding programmes already. Spain has also made promising progress in its attempt to hit what is its largest ever funding target, with nearly a fifth of its total already in the bag. Italy will look to move into double figures from its 4% status in the coming weeks with a widely expected syndication.

International appetite boosted a benchmark trade from the Joint Laender (44) on Wednesday, with interest from several new investors helping to buoy the deal.

The Federal State of North Rhine-Westphalia sold a debut New Zealand dollar trade on Tuesday, a short dated floater. Kommuninvest sold a similar trade on the same day and bankers expect to see more New Zealand dollar deals out in the near future.

German sub-sovereigns kept new issue markets ticking over this week, taking advantage of a quiet market to get deals in before the burst of benchmarks in January. State of Lower Saxony, State of North-Rhine Westphalia and State of Berlin all tapped existing lines this week.