Germany

Vodafone has planted its flag to lead the 2021 IPO calendar, with the listing of its European towers unit in Frankfurt.

Tight trading levels will make covered bonds an attractive asset class for statement trades and issuers outside of the euro area, but market participants say that this is unlikely to be enough to lift overall supply volumes out of the doldrums in the second half of 2020.

BioNTech, the German biopharmaceuticals company, is selling 5.5m American Depositary Receipts (ADRs) on the Nasdaq through a share sale and a rights issue. The company, which is working with Pfizer to develop a vaccine for Covid-19, is the latest issuer to hit the market in a wave of biotech ECM issuance — but buyers are being warned against being too eager, reports Sam Kerr.

Guarantor: Federal Republic of Germany

Deutsche Bank has taken advantage of the addition of more collateral to its Pfandbrief mortgage pool following the merger with the former Postbank entity to issue more than €2bn of retained covered bonds.

Investors turned out in force as KfW brought its first benchmark green bond of the year this week. The strong demand allowed the German agency to print its joint biggest ever green bond on the back of its largest ever order book for such a deal along with an attractive pricing advantage over a conventional bond.

Reports that the European Central Bank (ECB) could ask banks to suspend dividend payments until the end of 2020 sent subordinated debt higher and stocks lower this week.

Credit analysts hope that European banks will be able to report much stronger capital levels in the second quarter, amid early signs that risk-weighted asset (RWA) volumes could be lower than expected.

KfW made a strong return to the benchmark green bond market on Tuesday, taking advantage of a more attractive pricing dynamic for green bonds over conventional issuance compared to earlier in the year.

The German covered bond market is famed for its stability but S&P has drawn attention to the diversity of its borrowers' cover pools, suggesting that their performance will begin to differ. One major investor said he favours bonds secured on residential loans, rather than commercial ones, as a result of prevailing economic conditions.

ADO Properties, the German real estate developer, concluded its €450m rights issue on Monday, with a high take-up from its shareholders.

KfW will lead the charge in the euro public sector bond market on Tuesday with a €3bn green bond that will match its biggest ever deal in the format. Eurofima and the State of Berlin are also preparing to bring bonds to the euro market.