Pre-migration untagged articles

After weeks of staggering drunkenly like a City broker on Friday afternoon, the CDS market has recovered a degree of poise this week. But will the money pledged to save the banks be enough to save them from CDS exposure?

Although Tesco’s £100m tap last week was essentially a private placement to one investor, it showed at least that there is life in the corporate bond market yet. But as positive news flow turns negative once again, the mandates bankers had been working on Monday and Tuesday are less likely to materialise and we could go through yet another deal-less week.

KfW, the sole purveyor of euro denominated debt so far this week, is doing well with its two year euro with orders of over Eu2bn by lunchtime and the deal will likely price this afternoon at mid-swaps less 25bp. The dollar market is predictably busier with IADB announcing a three year benchmark at mid-swaps less 30bp via Citigroup, Morgan Stanley and UBS. The Kingdom of Spain is also poised to issue a three year trade with Barclays Capital, Deutsche Bank and Dresdner Kleinwort. Price guidance is mid-swaps less 30bp.

Moody’s yesterday (Tuesday) lowered Depfa ACS Bank’s public sector asset covered securities from Aaa to Aa1, and also cut HRE Bank International’s mortgage Pfandbriefe from Aa2 to Aa3. In addition, both ratings remain on review for further downgrade. The actions follow Moody’s recent downgrades of several HRE entities’ senior unsecured debt ratings. Read EuroWeek on Friday for a reaction to these rating actions.

The Swiss market continues to stand alone, making room for a deal a day since Friday while other bond markets remain shut. The European Investment Bank, the Federal State of Brandenberg and Norwegian power company Statnett have all issued so far but trades are more difficult to perform than ever. Lead managers are watching, waiting and hoping; soft sounding, pulling back and then darting in, as swap rates play havoc with the nerves. Read EuroWeek on Friday to see who launches next.

UK company Virgin Media (formerly NTL) this week asked lenders for a waiver to its £4.32bn leveraged loan. Virgin will pay a fee to creditors who agree to the amendment, which will defer amortization payments until June 2012. Virgin follows other borrowers such as Yell Group and Amadeus in seeking a waiver. The former succeeded, while the latter, which would not pay lenders an extra fee, failed.

Talk about dedication... Around 3:30 last Wednesday, an announcement was made inside the downtown Deutsche Bank building that there was a suspicious package found in the atrium next to 60 Wall Street.

An auction was held for loan-only credit default swaps and LCDX trades of Movie Gallery after the company filed for Chapter 11.

The following charts show the top five advancers and decliners in terms of % moves in the loan, bond and credit default swap markets for the previous week. Data provided by Markit Group.

--James Seery, former head of fixed-income loans at Lehman Brothers Holdings, in testimony during the Lehman Commercial Paper Inc. bankruptcy hearing last Monday.

Arguably the most contentious element of the £50bn capital facility that the UK government is offering is what it will want in return for taxpayers’ money.

Much of Royal Bank of Scotland’s capital markets business, which sits in the bank’s global banking and markets division, will be spared the knife after the UK government’s capital injection.