JP Morgan

Bank of China broke new ground for Asia this week with the region’s first floating rate bond linked to the secured overnight financing rate (Sofr). But a host of challenges around payment calculations and liquidity mean other issuers will be slower to embrace this new benchmark. Addison Gong reports.

Two supranationals are on screens for ESG firsts. The European Bank for Reconstruction and Development (EBRD) has announced its first green transition bond, while the Asian Development Bank (ADB) is preparing its first foray into the green bond market in sterling, capitalising on strong appetite from UK pension funds.

Italy delighted investors with its first dollar bond in almost a decade on Wednesday, as it raised $7bn across three tranches. However, bankers away from the deal said the sovereign paid up over its domestic cost of funding — something it had originally planned to avoid.

The International Development Association (IDA) priced its debut euro benchmark around 5bp wider than its sister issuer, the World Bank, according to the leads.

Enel, the Italian electricity and gas company, held investor calls today for its first trial of its new sustainability-linked bond structure in euros, likely to be launched tomorrow. The deal has a more complex structure than the $1.5bn bond with which Enel introduced this technique to the bond market for the first time in early September, in that it contains tranches with different triggers.

The European Financial Stability Facility (EFSF) is preparing its first benchmark of the fourth quarter and Ireland has picked the banks to lead the first tap of its sovereign green bond.

Raiffeisenlandesbank Niederösterreich-Wien (RLB Noe Wien) found the euro primary market to be quiet but bullish this week, allowing it to launch a new senior unsecured bond at what lead managers saw as a fair pricing level.

Indian telecommunications company Bharti Airtel’s efforts this year to deleverage were capped with the issuance of a subordinated perpetual $750m bond on Tuesday. The deal, alongside further stake sales planned for the rest of 2019, puts the company on track for a more stable debt profile. Morgan Davis reports.

The Inter-American Development Bank and the State of North Rhine-Westphalia only managed to raise small sizes in the sterling market on Tuesday, with the leads on the latter declining to comment on whether the deal was fully subscribed.

Greece and the Province of Québec won strong books in the euro public sector bond market on Tuesday, with the latter returning to the currency for the first time since June 2018. An attractive basis swap for dollar funders to issue in euros has tempted the International Development Association (IDA) out on screens for its first euro benchmark.

Public sector borrowers enjoyed healthy subscription levels and minimal new issue concessions in the five year part of the curve as they returned to the dollar bond market following the Golden Week break in China.

LBBW and JP Morgan have claimed first execution of an electronically negotiated euro short-term rate (€STR) swap transaction, on Bloomberg’s UK multilateral trading facility (BMTF).