North America

Royal Bank of Canada, Toronto Dominion Bank and Canadian Imperial Bank of Commerce all attempted to access the covered bond market on Tuesday with euros clearly showing more depth than sterling. The fact the three issuers were in the market simultaneously, whilst a fourth was monitoring the market, is not coincidental and contrasts with European and UK issuers that already have a central bank liquidity life line.

Latin America bond issuers and investors were thrown deeper into the coronavirus crisis on Monday, with Friday’s spread tightening more than cancelled out as the US Federal Reserve’s surprise 100bp rate cut on Sunday failed to arrest a fall in risk assets.

An extraordinary demonstration of support from the US Federal Reserve over the weekend has done nothing to lift investors' spirits, with fears about the economic consequences of Covid-19 showing through in equities, credit and even the rates market on Monday morning.

In this round-up, the reserve requirement ratio cut in China went into effect on Monday, the country’s industrial output declined sharply in the first two months of the year, and the State Administration of Foreign Exchange lifted the cap on outstanding foreign debt of Chinese issuers.

JP Morgan appoints syndicate head for private markets — RBC loses M&A banker — Mizuho names sustainability head

As the coronavirus pandemic threatens every facet of capital markets activity, trading floors and back offices have emptied in recent days, leading to questions about how efficiently business can be done from home and alternative sites, write Paola Aurisicchio, Jasper Cox, Jennifer Kang and Ross Lancaster.

Governments and central banks failed to prevent fear from taking hold of the capital markets this week, as Covid-19 reached pandemic status. European equity indices faced record falls on Thursday, before the Federal Reserve Bank of New York announced a $500bn repo operation to combat "highly unusual disruptions" in the US Treasury market. But it is far from clear if such extraordinary intervention will be enough to stop the panic.

Bankers hope a massive liquidity injection by the Federal Reserve Bank of New York will help stabilise the dollar corporate bond new issue market after the Covid-19 crisis triggered a global market rout this week.

Global stock markets have succumbed to panic in a violent and historic sell-off that echoes the worst days of the 2008 financial crisis thanks to the spread of the Covid-19 coronavirus, and equity capital markets are shuttered in response. However, ECM bankers are focusing now on the "other side of the tunnel" and rights issues for cash-strapped clients.

The coronavirus will depress mergers and acquisitions activity, hurt advisory revenues and change the emphasis of deal-making in 2020, writes David Rothnie.

Bank of Nova Scotia (BNS) became the first bank outside Europe to issue a deeply negative yielding covered bond in a good size on Wednesday. The transaction provided a beacon for other issuers and was perfectly timed to benefit from a window of market stability between Monday’s and Thursday’s shocking volatility.

Spreads on financial institutions bonds are recovering from a brutal sell-off at the beginning of the week, as European governments and central banks weigh in to help economies deal with the Covid-19 coronavirus outbreak.