Germany

The European Investment Bank and FMS Wertmanagement sold well oversubscribed issues in the sterling SSA market on Tuesday before an expected quieter period for new issues in the currency next week as parliament votes on prime minister Theresa May’s revised Brexit deal.

L-Bank is set to bring the first ever Reg S only Sofr-linked bond on Tuesday. The German agency will be joined in the dollar SSA market by Japan Finance Organization for Municipalities, which has picked banks for its first benchmark of the calendar year.

Bausparkasse Schwäbisch Hall (BSH) could soon become the first German Building Society to issue a benchmark Pfandbrief. GlobalCapital speaks to Rainer Eichwede, head of finance controlling at BSH, at the 13th LBBW European Covered Bond Forum in Mainz.

Dollar swap spreads tightened dramatically in the middle of the week — with bankers at a loss to explain why — but the SSA sector was still “rock solid” in one syndicate head’s words, so the currency should be open for business next week. The only two dollar trades this week — a bond market return from CDP Financial and first deal of the year from Erste Abwicklungsanstalt — both went well.

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German industrial services company Bilfinger has launched a Schuldschein months after pulling a transaction in the public bond markets. The BB-rated company is offering a spread substantially higher than a typical Schuldschein borrower, in the hope that lenders will forego its failed bond market foray and be charitable with its chequered past.

Germany’s Merck has made an unsolicited $5.9bn enterprise value offer for Versum, the US maker of materials for the electronics industry, amid a spate of mergers and acquisitions announced this week, though financiers say that has yet to spark a rise in loan demand.

The German lower house has approved an amendment to Pfandbrief legislation that should ensure UK assets remain eligible in German Pfandbriefe. Had the amendment not been passed, overcollateralization ratios of some Pfandbriefe would have fallen sharply.

Trumpf, a family-owned mechanical engineering company headquartered near Stuttgart, has launched a triple-tranche Schuldschein.

Erste Abwicklungsanstalt (EAA)’s decision to forego the price discovery process on its first benchmark of 2019 paid off, as the issuer printed more than its original target for the dollar deal on Tuesday at a level that some SSA bankers away from the deal said may have been slightly through its secondary curve.

German industrial services company Bilfinger has launched a Schuldschein months after pulling a transaction in public markets. The BB-rated company is offering a spread substantially higher than the typical Schuldschein borrower, in the hope that lenders will forego its failed foray and be charitable with its chequered past.

Sterling issuance may be slowing down after its record start to the year, but investor demand shows no signs of cooling — as KfW proved with a tap on Monday that was nearly double its original target size. Any “bank treasury friendly” borrowers should find healthy demand if they follow in the currency, said bankers.