North America

Representatives from the Loan Syndication and Trading Association (LSTA) and the CLO manager community returned from Japan this week following meetings with the Japanese Financial Services Agency, where they made a case for exempting broadly syndicated loan (BSL) CLOs from proposed risk retention rules.

A strong start to the year for public sector dollar issuance is keeping up the pace so far this week, with last week’s slowdown during the Chinese New Year holidays only appearing to make investors hungrier. Both of Tuesday’s dollar deals were well oversubscribed — one spectacularly so — and there is a full card of issuers waiting to come on Wednesday.

US tobacco group Altria on Monday ended a blackout-blighted slow start to February for the euro corporate bond market when it brought a new deal that included four benchmark tranches. This came the day before the company sold $11.5bn in its home market.

In this round-up, China and the US will talk in Beijing at the end of the week, China’s interbank payment and settlement system survived the Lunar New Year red packet frenzy and a draft of the foreign investment law will be submitted in early March.

Pinduoduo, a Nasdaq-listed Chinese e-commerce company, has raised $1.38bn from a follow-on offering.

Bank of America Merrill Lynch has ramped up its Brexit preparations by establishing a new EU broker dealer and appointing Sanaz Zaimi as its CEO.

Bank of Nova Scotia this week became the third Canadian bank to have hit the dollar market with a debut bail-in bond, as spreads continued to rally.

Just six months after listing on the Nasdaq, Chinese start-up Pinduoduo is back in the equity market to raise around $1bn from a follow-on offering.

High yield bonds for auto parts manufacturer Adient slipped more than three points on Thursday as the company tweaked its loan covenants and produced disappointing numbers. The firm’s new management is taking aggressive action to turn the group around and says it needs the financial headroom to do so.

The dollar issuance calendar continued to smoulder with a handful of borrowers enjoying bulging order books and pricing leverage as investors continued to return in force to high-grade credit. With corporate earnings still acting as a handbrake and the Chinese New Year further dampening activity, supply was steady rather than spectacular.

Analysts at the research house CreditSights expect that Canadian banks could soon start issuing more senior bonds for their total loss-absorbing capacity requirements (TLAC), having held back from the market after taking care of their funding needs with older forms of senior debt.

Goldman Sachs has held off from rewarding some retired executives compensation until “more information is available” on the 1Malaysia Development Berhad scandal.