The International Finance Corporation has become the most recent supranational to print in Russian roubles, following close behind a trio of its peers that made rare appearances in the currency last week. High yields in the currency, despite Russia’s central bank cutting its key interest rate, have bankers expecting more supply to come.
KfW has made its first ever foray into Indian rupees and it is keen to do more in the currency. It joins a growing band of supranationals and agencies dabbling in the currency's offshore and onshore bond markets.
Medium term note investors could be forced to swallow negative yields on private placements following dramatic pricing moves, after the European Central Bank’s announcement of quantitative easing last week. The first ever such deals are thought to have been sold this week, as supranationals and agencies tightened levels after the ECB’s decision.
The Federal State of Saxony-Anhalt has sold its third ever sterling private MTN and is looking to print nearly half of its 2015 funding target through private placements, in any liquid currencies it can find.
Euro commercial paper issuance dropped to its lowest level in 11 years in 2014, and the market faces a further threat from proposed bank-style regulation for money market funds.
Sovereign, supranational and agency issuance volume of privately placed medium term notes hit a seven year low in 2014 and such declining figures could characterise MTN volumes this year as well, as tightening yields push investors down the credit curve toward banks and corporates issuing in the format.
FMS Wertmanagement tapped a 2018 sterling line on Monday, following a host of private placements in the currency from other euro funding issuers taking advantage of a favourable cross currency basis swap.
KfW has sold a rare, privately placed note with a step-up inverse floating rate structure, which dealers said could be a sign of other similar trades to come.
German insurance companies and pension funds are looking at longer and longer tenors as they hunt for return in Europe’s low yield environment. World Bank was able to satisfy some of this demand with a 50 year callable zero private placement and more such long dated callable zeros could be on the cards.