Germany

The Federal State of Saarland hit the market on Monday to raise €500m with its first seven year bond since 2016.

The prospect of switching out of Pfandbriefe exposed to a high proportion of foreign commercial real estate and into higher-yielding, and more liquid, Scandinavian covered bonds exposed to domestic loan portfolios that are less affected by the coronavirus, is a tempting choice. But the protection Pfandbriefe offer investors and the scarce supply outlook means spreads on the product will remain supported, said bankers on Monday.

Funding needs of regions across Europe are expected to rise this year as borrowers fund responses to the coronavirus pandemic. Spanish and German regions in particular will face heavier borrowing requirements.

The German state of North Rhine-Westphalia made its first visit to the offshore renminbi market earlier this week, continuing this year’s SSA dim sum shopping spree.

The Schuldschein market is expected to reopen in a matter of days, but arrangers will face a changed market and will have to adapt to the new corporate lending landscape created by the coronavirus pandemic.

Five years after issuing its first green Pfandbrief, Berlin Hyp (BHH) issued its first two green private placements, just before publishing it annual green bonds report on Monday. But Pfandbrief benchmark supply hopes seem distant as spreads to German Laender are prohibitively tight.

Deutsche Bank’s additional tier ones surged higher in value this week, after the German lender reassured the market with positive guidance on its first quarter earnings.

GlobalCapital's Silas Brown spoke to Mathieu Chabran, co-founder of European alternative asset manager Tikehau Capital. They discussed how the relatively new private debt market in Europe will navigate its way through the pandemic, who the winners and losers will be in the asset class, and what opportunities may emerge from the dust.

Helaba has been far more active than other arrangers in the Schuldschein market, launching at least three deals after the pandemic struck European capital markets in March. While others told clients to postpone deals until clarity emerged on price and investor appetite, the Frankfurt-based Landesbank has ploughed ahead.

Supervisors are encouraging financial institutions to use all of their capital and liquidity buffers as necessary during the coronavirus crisis, signalling that lenders will be given a "significant" amount of time to restore their regulatory ratios to adequate levels.

The Covid-19 global pandemic is not an unmitigated disaster for everyone, as several companies showed on Monday night by selling new shares to take advantage of the unexpected opportunities that the pandemic has created for them.

US entities of two of the Big Four accounting firms have entered the private placement market. KPMG sold US private placements in early April, according to market sources, while Deloitte is looking to follow suit.