Germany

Deutsche Börse’s CEO, Theodor Weimer, on Wednesday committed to greatly reducing the exchange group's structural costs by 2020 while doubling down on growth, technology and acquisitions.

Bond market havoc following the Italian president’s decision to appoint a technocratic government has shut the euro market for most public sector borrowers. Volatile swap spreads are making issuance near impossible, while an “enormous” flattening in Italy’s curve is of particular concern for that sovereign, said one head of SSA syndicate.

Helaba and VC Trade launched a digital platform with the hope of transforming the market, but the big test was whether other arranging banks would be convinced to join up. Two months later BayernLB is co-arranging a transaction with Helaba — which could be the first sign of broader acceptance of the platform.

The political manoeuvrings in Italy’s path to being governed — as well as poor eurozone economic data — played havoc with rates this week, leading to SSA deals either paying higher new issue concessions, or falling short of subscription. More volatility could come, after the country’s president approved the likely coalition partners’ choice of prime minister but held back from appointing a eurosceptic economist to take charge of the country’s economy. Craig McGlashan reports.

Frozen bakery supplier Aryzta’s shares fell by as much as 30% on Thursday as it issued a profit warning that full year Ebitda was expected to be 9%-12% lower than guidance released in January. This is a cause for concern for Schuldschein lenders endeavouring to rid the market of the stench left by Carillion and Steinhoff.

Rating: Baa2/BBB/BBB+

After the Whit Monday holiday in Europe, Deutsche Telekom boldly re-opened the corporate bond market. Having seen compatriot Bertelsmann pull a deal on Thursday, Europe’s largest telecoms provider showed no fear when it sold a four-tranche offering.

German energy supplier Innogy found the corporate bond market tough going for its latest new issue, despite marketing its deal for two days. However, it did execute the deal in a week that saw two corporate bond deals pulled, and despite an M&A shadow hanging over the company.

Dexia Crédit Local scored what leads said was a good result on Thursday as it brought a trade at the upper end of its size plans and tightened pricing during another volatile day for eurozone rates. KfW was also out in euros, with a tap, although it appeared to be more of a slow burner.

The Schuldschein market has been left with more questions than answers after a Moody’s report claimed IFRS 9 rules, which force liable assets to be marked-to-market, could implicate "liquid" Schuldschein loans.

Covered bond deals issued in the five to seven year part of the curve on Wednesday by ING Belgium, Berlin Hyp (BHH) and The Fédération des caisses Desjardins du Québec (FCDQ) were all well received and stood in stark contrast to a 10 year from Nationwide.

On Wednesday, US electrical appliance manufacturer Whirlpool became the second investment grade corporate borrower to pull a deal in a week. German energy company Innogy and Whirlpool both found the corporate bond market tough going on Wednesday, despite having employed two-day marketing strategies. Whirlpool, however, took the hardest hit.