Germany

KfW began a new wave of 10 year supply this week, reopening the SSA market’s trickiest tenor for business. Issuers are so eager to access the maturity that they are having to jockey for position.

Guarantor: Federal Republic of Germany

A surge in repo-eligible issuance and deteriorating credit outlook for the retail and hotel commercial mortgage segments that secure some cover pools has pummelled the Pfandbrief market. This has been compounded by a lack of transparency leading to "an uneasy feeling" and ‘some uncertainty’ said bankers.

German electricity company RWE has sold €2bn of stock to fund its long term ambition to grow its renewable energy capacity, via one of the largest block trades this year.

German drug packaging manufacturer Gerresheimer launched a Schuldschein on Tuesday, according to market sources, ahead of €190m of debt maturing this November.

KfW opened up a window for 10 year dollar bonds in the public sector market on Tuesday amid a rise in long-dated US Treasury yields with two more borrowers hoping to find similar success in the tenor on Wednesday.

Two agencies were out with dollar mandates on Monday and more public sector borrowers could follow with deals this week as a rise in US Treasury yields boosts demand for SSA dollar bonds.

Germany’s CureVac has gone public on the Nasdaq, joining the army of biotech companies that have tapped the equity capital markets for cash during the pandemic, despite growing concern of a brewing dot-com style bubble.

VC Trade, a digital platform in the Schuldschein market, has begun promoting secondary trading on its system, with an eye of scaling up into Europe’s loan markets.

Overcollateralisation (OC) levels have increased on covered bond pools since last year for European issuers, Fitch Ratings said this week. But while issuers in some countries, like the UK, showed a rise above the average, borrowers that have participated in central bank funding, like those in Germany, have managed to keep OC levels down.

BMW Finance, a subsidiary of German carmaker BMW, sealed a Rmb500m ($72m) three year dim sum bond on Thursday. It was the first publicly sold offshore renminbi trade by a corporation since November last year.

A pair of German sub-sovereigns had the primary public sector bond market to themselves this week, with each taking €500m at tight levels to their secondary curves.