Germany

The sustainability-linked debt structure, which has already spread from the loan market to corporate bonds, has made its first appearance in a convertible bond, with a deal by Dürr. CB specialists expect it will take root in that asset class too. Jon Hay and Aidan Gregory report.

Bank Nederlandse Gementeen kicked off a busy week for socially responsible bond issuance by public sector borrowers with a well-received 12 year sustainable bond, its longest ever deal in that format.

The City of Bremen was heavily undersubscribed as it came to the market with an eight year bond on Thursday, in what is the region’s second consecutive public deal that has failed to reach full subscription.

Schuldschein lenders are gearing up for a wave of borrowers to tap the market this month, looking to capitalise on mounting piles of investor cash.

Aareal Bank sold the first bank bond in euros for a week on Wednesday, offering encouragement to other issuers who have remained stuck in the pipeline.

Moody’s has changed its outlook for Commerzbank’s issuer rating to ‘negative’ over concerns about a reduction in the bank’s senior debt levels.

Three Asian lenders in the Schuldschein market have said they are struggling to lend into specific sectors that have fallen into difficulty during the coronavirus pandemic.

Trading levels given are bid-side spreads versus mid-swaps and/or an underlying benchmark and bid-yields from the close of business on Monday, September 28. The source for secondary trading levels is ICE Data Services

Germany’s national debt management agency, the Finanzgentur, has outlined its issuance plans for the fourth quarter, which includes the details of the sovereign’s second ever green bond following its debut deal in the format earlier this year.

Fédération des Caisses Desjardins du Québec (CCDJ) mandated leads for its first dollar covered bond in a year on Monday. The issuer joins Sumitomo Mitsui Trust Bank, which on Monday crystallised plans to press ahead with its debut deal following a period of soft marketing, while Swedish non-conforming lender Bluestep Bank commenced marketing on Monday.

Mizuho Financial Group will be looking to time the sale of a new senior deal very carefully this week, with euro market conditions still proving challenging for issuers.

After a week without deals, the primary euro public sector bond market will see a return of activity next week with Bank Nederlandse Gemeenten and the State of North Rhine-Westphalia preparing to bring sustainable deals in the currency.