Italy
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Portugal’s bond yields fell to levels last seen in early September, as investor worries eased over a vital ratings review of the sovereign by DBRS this Friday. -
Snam’s zero coupon was the standout trade in the euro corporate bond market this week and while the borrower showed investors’ continued appetite for new issues, it also demonstrated conducive conditions for liability management.
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There is no shortage of factors that have troubled market participants this year: Brexit; US monetary policy direction; fragility in European banks; oil prices. All of these issues, and others, have caused credit spreads to widen at various intervals in 2016.
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Banca Monte dei Paschi di Siena’s tier two bonds received a boost this week, after it confirmed it was pressing on with its rescue plan but would not rule out Italian banker Corrado Passera’s new proposal for a way to raise €5bn of capital without involving bondholders.
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Italy’s corporate sector extended its run of new bonds intended to fund buy-backs on Wednesday, with multiutility Acea the latest borrower to use the manoeuvre.
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Snam visited the euro corporate bond market for the second week in a row on Tuesday, issuing a €500m four year bond and clinching a 0% coupon for the offering.
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UniCredit looked to push its senior curve out to 10 years this week, finding a supportive backdrop amid confirmation of Banca Popolare di Milano’s merger with Banco Popolare.
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A flurry of follow-on equity sales this week, mostly block trades, showed that investors still want stock, sometimes at tight discounts, even while three IPOs had to be abandoned.
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Italy showed that not every investor’s fingers were burned by the sudden sell-off of its debut 50 year benchmark last week, as it printed its largest private placement in over 18 months on Monday.
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UniCredit has tonight launched another block trade of shares in FinecoBank, the Italian retail online brokerage, bank and asset manager of which it owns 55.5%. The 20% stake is worth €580m before any discount.
