Santander

Greater clarity over Brexit is allowing UK banks to enjoy a warm reception in euros at the start of 2020, with Lloyds Bank Corporate Markets following two of its peers into the market this week.

Banca Monte dei Paschi di Siena was marketing a new senior bond in the euro market on Tuesday, a matter of days after it completed its capital raising plan with a tier two sold at 8%.

Issuers of additional tier one (AT1) capital have been more than 10 times subscribed for new deals on average in 2020 so far. This week's euro trade from Erste Group was no exception, with the €500m bond attracting €6.25bn of orders and a 'phenomenally tight' coupon.

The Republic of Chile has mandated banks to arrange its second euro green bond offering, as well as launching a tender offer of outstanding euro debt.

Landesbank Baden-Württemberg (LBBW) is set to become the first issuer of green non-preferred senior paper in the sterling bond market, as well as the first financial institution to include sustainability ratings in a new deal mandate.

While every eurozone country that sold a new syndicated bond this year has received strong demand, Spain outshone them all this week by taking the biggest ever order book in the bloc.

Rating: Baa1/A/A-

The European socially responsible investment corporate bond market has made a rampant start this year, with issuance in the first two weeks already more than 10% of the total issued by companies in European currencies in 2019.

UK private placement advisers and agents are keen to speak to North American investors about their appetite for debt from UK local governments, seen by many as the next source of growth for PPs in Europe after the central government raised the rate at which it lends to them.

Demand for senior trades from Commerzbank and Raiffeisen Bank International this week reflected a softness in secondary performance, as well as a slowdown in the primary market as European banks enter blackout season.

Commerzbank was able to attract "very high quality books" for its issue of non-preferred senior euro and sterling bonds on Wednesday.

Banco Santander has followed through on its commitment to call an additional tier one (AT1) bond, after extending the life of the instrument a number of times in 2019. The decision comes as favourable market conditions increased the likelihood that issuers will choose to refinance their contingent capital securities this year.