Nordea Markets

Italy returned to the private placement market to print one of the year’s largest MTNs on Thursday. The deal stood out this week, since issuance in the market has started to wind down ahead of Christmas.

Sub-benchmark deals are not so much of a novelty anymore: a trio of rare names filled their boots with diminutive deals this week, with each attracting bumper demand.

Luminor Bank was more than 3-1/2 times subscribed on its return to the euro market on Wednesday, allowing it to demonstrate a year-on-year improvement in its senior funding costs.

As benchmark issuance remains on the side-lines, smaller issuers have come out to play, with rare borrowers Cassa Centrale Raiffeisen dell’Alto Adige and Luminor Bank on the hunt for deals Lilliputian in size on Tuesday. A handful of larger issuers are keeping a close eye, and could come to the market with small deals of their own in the coming weeks.

Metso Outotec, the Finnish mining equipment maker, and UK warehouse Reit Tritax Big Box have mandated for corporate bond issues, as the euphoria in the high grade market shows little sign of waning.

Citycon Group, the Nordic shopping centre company, has signed €500m of revolving credit facilities. It wants to shore up its balance sheet as it teeters on the edge of a junk rating.

The clamour for green bonds was on display in the corporate market on Thursday when UPM-Kymmene, the Finnish pulp and paper company, had its debut green issue more than six times oversubscribed, while a conventional bond for Swedish truck maker Scania found more modest demand.

The Kingdom of Sweden will come to market on Wednesday for a new 25 year Swedish krona benchmark, coming on the heels of a green bond from the City of Gothenburg.

Rising coronavirus cases and circling uncertainty around the upcoming US election is driving the Swedish krona market towards higher rated, domestic names.

Euronav, the Belgium based crude oil tanker company, has signed a $713m loan package, as the sector outlook turns bleak after a strong start to the year because of an overproduction of oil.

Nordic banks are likely to focus on smaller private placements for the rest of the year, with many already having enough liquidity that they do not need to print new benchmarks.

Argenta Spaarbank, Belfius Bank and Jyske Bank took differing approaches to sell €500m no-grow senior bonds this week — Argenta offered a substantial new issue premium, while the latter pair pushed their pricing close to fair value.