KfW

KfW hired a trio of banks to sell a short-dated dollar floater on Monday afternoon, as Rentenbank looked to price a $325m tap of three year floating rate notes.

Bank Nederlandse Gemeenten (BNG) may lead a small handful of issuers looking to print deals before investors pack their buckets and spades and head to the beach for the summer. The Dutch agency joins its compatriot Nederlandse Waterschapsbank (NWB) among the names that may well access public markets before August.

KfW took advantage of a clear issuance window on Tuesday to bring a long-awaited euro benchmark, shrugging off uncertainty over how fast rates will rise in the run up to the Federal Open Market Committee’s meeting on Wednesday. The result was hailed as “encouraging” by market participants who also had the spectacle of a €1bn tap of the EIB’s recent 10 year EARN to take comfort from.

This week's funding scorecard focuses on some of Europe's key supranational and agency borrowers. Forthcoming editions will bring updates from other French, German, Spanish and Scandinavian names.

With sentiment turning against new issues this week after a prolonged rates sell-off, the benefit of front-loading issuance programmes is there for all to see. There has been nothing as drastic as markets shutting down to contend with, but a spate of weak deals this week has proven that the relentless bid that had sustained the new issue market for over six months was not indefatigable.

KfW accessed the Canadian dollar market for the first time this year on Wednesday, selling the largest ever Canadian dollar bond from an international SSA issuer. The deal signifies increased investor interest in the currency, with buyers treating it as a possible alternative to a weakening Australian dollar, and that could inspire further deals in the currency, said bankers.

KfW is expected to price its first Canadian dollar deal of the year on Wednesday afternoon, opting for a five year note. It will be the largest Canadian dollar deal from a non-Canadian issuer since before the crisis.

KfW could follow the EIB into the euro market within the next couple of weeks, bankers said on Wednesday, after the supranational’s €3bn 10 year was successfully absorbed this week, despite the volatile underlying market.

SSA syndicate bankers are predicting either a seven year benchmark from the European Financial Stability Facility (EFSF) next week, or a deal at the far end of the curve, after they made their recommendations to the borrower this week. The European Investment Bank and KfW are also expected to issue either next week or the week after.

The Council of Europe Development Bank (COE) will add to a rush of short-end dollar supply on Thursday, having mandated banks for a five year global deal. The trade follows a five year dollar global from KfW on Wednesday afternoon and deals from Swedish Export Credit and Österreichische Kontrollbank on Tuesday.

KfW and Unédic have both announced new benchmark mandates in what is expected to be a week of heavy supply in the SSA market.

Australian investors have a deserved reputation for being fussier about what they buy than their European counterparts — there’s a reason that the Kangaroo market has traditionally been dominated by the cream of the SSA crop. However, things are starting to change.