Nordea Markets

Market participants expect European banks to take a large chunk of funding through the European Central Bank’s Targeted Longer-Term Refinancing Operations (TLTRO III) programme, hitting covered bond supply levels. But issuance in other asset classes should remain unaffected as banks follow through with their funding plans.

Nordea Bank took advantage of very attractive conditions in the dollar market this week to price a new senior deal at a spread that was well below the fair value implied by secondary trading levels.

Estonia returned to the capital markets on Wednesday after 18 years away, introducing itself to a new set of investors as an SSA borrower.

Banks are taking a greater share of issuance in the bond markets in the middle of the second quarter, with a spread rally opening the way to deals in all currencies and across the capital structure.

Nordea has made extensive use of Nordic currency covered bond markets through the coronavirus crisis and, as spreads have stabilised, has selectively issued senior preferred deals across a broad range of other FX. The bank says it has plenty of time to meet its regulatory funding needs and has no imminent plans to issue subordinated debt given the recent relaxation of capital requirements.

Alberta made its first foray into the Norwegian kroner market on Thursday — the same day that S&P placed the province’s credit outlook on negative.

Denmark has made public the mandate it had given earlier this year to three banks to help it prepare to issue the world’s most unusual green bond, as the work is getting to a more advanced stage. A political decision to issue might come towards the end of this year.

The Republic of Estonia has mandated for a 10 year benchmark bond, as it prepares for its first foray into bond markets since 2002.

Sweden’s Volvo Car, a car maker, has become the latest company under pressure from the coronavirus pandemic to sign a state-guaranteed loan, as bankers say that state support is essential to secure commercial bank loans for the worst affected sectors.

A supranational and a Nordic bank paid rare visits to the Swiss franc market this week. The North American Development Bank (NADB) printed its first deal in two years — its second green bond — while Nordea returned after a five year absence.

The recent maturity of a large Nokkie line released NOK9bn ($904.5m) into the market last week, with some foreign investors eager to reinvest in attractive short end paper.

Norway’s debut syndicated tap went off with a bang on Tuesday, attracting a bumper Nkr37bn ($3.7bn) order book. The deal’s success was driven in part by increased demand from foreign investors for Norwegian govvies.