Pre-migration untagged articles

Robert Bosch, the German machinery firm, is issuing its first bond deal since 2006 this week with a dual tranche four and eight year transaction, but as non-government guaranteed financial issuance makes its slow and steady return, the market’s focus has shifted slightly from corporate bonds. Still, with Bosch and a McDonald’s transaction out today, there is still plenty of supply to keep corporate investors happy. To find out how all the deals in the market this week fared, read EuroWeek this Friday.

The European Central Bank is considering making loan-by-loan disclosure a requirement for asset backed securities to be eligible in the Eurosystem collateral framework, said a senior official today, in a sign that policymakers are taking seriously criticism that they are holding back public market issuance.

If size matters, then the Hellenic Republic has achieved something extraordinary this week — a Eu21bn book for its 10 year tap, which was launched with guidance of mid-swaps plus 185bp area. It was the largest book this year for a syndicated sovereign bond. After tightening guidance to 178bp, which represented a new issue premium of just 3bp, orders continued to flood in, allowing the borrower to issue Eu8bn, the largest syndicated sovereign bond since 2004. Read EuroWeek on Friday for reactions to a week of firsts in the SSA market

HSBC is in the process of marketing a self-led bullet euro 10 year lower tier two at 245bp-250bp over mid-swaps. The transaction has attracted over Eu3.5bn of orders as investors show their support for the asset class.

Two new benchmark issues and one non-jumbo have been priced ahead of the tomorrow’s European Central Bank meeting at which it will release details of its Eu60bn covered bond purchase plan announced on 7 May. Deutsche Bank yesterday priced its debut Pfandbrief, a Eu1bn seven year deal, at 55bp over mid-swaps, the tightest level for a mortgage-backed benchmark this year. BNP Paribas hit a tight level on its first public sector obligations foncières, a Eu1bn five year that was priced at 77bp over. And Finnish issuer Aktia Real Estate Mortgage Bank will today price a five year non-jumbo. Read EuroWeek this Friday to find out more about this week’s deals, details of the ECB’s purchase plan and what these mean for the market.

Smaller, lesser known financial institutions are in focus this week, with Banco Santander Totta and Piraeus Bank successfully marketing their deals. Both deals are set to price today and both have got oversubscribed books suggesting that risk appetite remains intact and the market tone strong. Meanwhile, government guaranteed issuance is limited to only one public transaction this week, a three year from Caja de Ahorros del Mediteraneo. To find out more about the transactions, read EuroWeek on Friday.

The phenomenal performance of Rabobank’s $1.5bn perpetual non call 10 year hybrid tier one which came on top of the issuer’s bond exchange last week has given hope that the market could slowly reopen to other issuers. Even though the news flow around the asset class continues to be negative — with downgrades as well as Deutsche Bank not calling its bonds — the deal shows that investors are still willing to buy hybrid tier one. To find out more about what to make of the Rabo results, read EuroWeek on Friday.

The Saad Group has become the latest Saudi Arabian borrower to set alarm bells ringing among creditors after it was downgraded to default status on Tuesday. Privately-held Saad, one of the kingdom’s biggest conglomerates, says it is restructuring its debt, and is confident of a successful outcome. But its own woes will have repercussions for some of the banks and companies it holds across the Gulf, and concern is mounting about rising defaults in the region. Read EuroWeek on Friday for creditors’ reaction and the latest on Middle Eastern restructurings

The European Bank for Reconstruction and Development this week issued the first sub-Libor trade from an SSA borrower in dollars since October 2008 in a major milestone in the recovery of pricing levels for the sector. The $1.5bn two year global will be priced this afternoon at mid-swaps less 10bp, aggressively tighter than initial guidance of less 5bp. Also in dollars this week, a three year SFEF trade blew out at mid-swaps plus 25bp-30bp. After getting a $14bn book, the agency printed $6bn at plus 25bp

Sale of commercial paper to the Bank of England’s Asset Purchase Facility reached their highest weekly total to date this week. For the week ending May 28, the fund bought £701m of sterling-denominated corporate CP, up from £394m the previous week. The most the facility had ever bought since its launch in mid-February before this was £561m in the week ending March 12. It is likely that a lot of the issuance is due to rolling maturities — the total held by the facility only climbed from £2.24bn to £2.29bn. The fund passed the three month mark the week before last and it dropped the three month maturity requirement in late April to allow CP with a maturity of one week to three months. Market participants believe that the fund has recently become less attractive as spreads in the buyers market have tightened. “There’s not been a huge amount of interest in the APF, and it’s not as attractive as it was,” said one London-based CP head. Of those that appear to have used the facility since its launch, few are low-rated issuers or issuers that didn’t already have a CP programme. “The problem is that it hasn’t really helped the people that it was intended to,” said the CP head. “A lot of it was supposed to help the A3/P3 names, but the problem is that to set up an ECP programme you need backup lines, and banks won’t give those out at the moment.” Nonetheless, dealers report that some issuers have recently been approved to use the fund.

The proportion of corporate paper issued in the European commercial paper market increased this week as a greater diversity of corporate borrowers, buoyed by growing investor confidence and favourable rates, issued paper. But investor demand is still far from sated, say traders.

Dealers of private EMTNs: Non-syndicated deals for less than $250m excluding financial repackaged SPVs, GSE issuers, self-led deals and issues with a term of less than 365 days.