Nordics

Investors have begun to push back against ever tighter levels in the public sector dollar market, with a deeply sub-Libor trade this week failing to find full subscription. But there was not much concern ahead of next week’s Easter holidays, with some strong funding already raised in the first quarter and the new Federal Reserve chair’s first Federal Open Market Committee meeting passing this week without any great surprises.

A sharp move wider in short end swap spreads has allowed public sector borrowers to offer substantial pick-ups to US Treasuries at deeply sub-Libor levels, but investors are beginning to rebel.

Finnish telecoms company DNA braved choppy conditions this week with a new €250m seven year bond to fund its tender offer for bonds due in 2018 and 2021 following a roadshow.

The Nordic Investment Bank has announced that it will become the second borrower of the week to access the two year dollar market. The first, Kommunalbanken, scooped up $1.25bn on Tuesday.

The sole investment grade corporate new issue on Tuesday was a sub-benchmark seven year deal as weak secondary markets finally pulled the handbrake on new issuance. Some recent deals had struggled to tighten from initial price thoughts and issuers paused to take stock.

Covered bond investors have “had enough of tight spreads" said a lead manager. as demonstrated on Tuesday by the contrasting fortunes of deals from Lansforsakringar Hypotek AB (LF Hyp) and Aareal Bank. At the same time, the European Central Bank continued to scale back its order.

Kommunalbanken announced a two year dollar benchmark on Monday, coming on the heels of a strong week for dollar issuance.

The IPO of Elkem, the Norwegian silicon producer and supplier being floated by ChemChina, priced on Wednesday at Nkr29 ($6.74) a share, the bottom of the expected range.

The sterling SSA market snapped back into life with a flurry of new deals after a quiet few weeks — although bankers lamented that the issuance door may have closed just as quickly as it opened.

Solidium, the Finnish national wealth fund, attracted a large book of over 120 investors when it sold €467m of shares in Sampo, the Helsinki-based financial services group, in a block trade on Tuesday night.

Iceland's Arion Bank was looking to add another year onto its senior unsecured bond curve on Tuesday, a week before its comeback euro deal was set to mature.

Elkem, the Norwegian silicon producer and supplier being floated by ChemChina, has had a good start to bookbuilding after launching its Nkr7.7bn (€805m) flotation on the Oslo Børs on Monday.