Santander

Environmentally minded investors piled into green and sustainable corporate bond issues in Europe on Monday, with deals for Energias de Portugal, South Korean steel company Posco and National Grid garnering around €10.3bn of demand.

The European Financial Stability Facility took the spotlight in the euro public sector bond market on Monday with an intraday execution ahead of a busy week. The European Investment Bank, Council of Europe Development Bank, Spain and Cyprus have all announced new deals.

Issuers this week have steered clear of negative yielding covered bonds, choosing longer maturities for their securities. Crédit Agricole Italia went as far as 25 years, while on the other end was Santander UK marketing a seven year tenor.

Yankee banks set a scorching pace for issuance in the first week of 2020 as they took advantage of red-hot funding conditions.

Foreign and domestic banks flocked to the UK this week as they sought to take advantage of stellar funding conditions in the sterling market. Bankers said this was the first chance issuers had to benefit from opportunities in the currency following December’s general election, which removed a lot of short-term uncertainty around Brexit.

Crossover credit Cellnex, the Spanish mobile phone mast owner, offered investment grade bond investors the chance to pick up some spread on Thursday, while unrated Air France-KLM waits in the wings.

Green corporate bond investors had plenty to sink their teeth into on Thursday, with electric utlities E.On bringing three tranches and Red Electrica making its debut in the format.

ABN Amro and Deutsche Bank opened books on new senior deals in the sterling bond market, with bankers recognising that the currency is 'working very well' for international names.

Danske Mortgage Bank, Santander UK, Raiffeisenlandesbank Hypothekenpfandbrief and UniCredit Bank AG were marketing covered bonds on Wednesday, steering well clear of negative yields by tapping into healthy demand for long dated assets.

Santander’s Chilean arm on Tuesday joined the early wave of dollar issuers from the country, pricing a $750m five senior unsecured bond 2bp inside where state-owned Banco del Estado de Chile sold an identical trade a day earlier.

Air France KLM has mandated banks for a five year euro bond. The appearance of an unrated issuer so early in the year is being seen as a sign of the market’s strength.

Nationwide Building Society issued the first sterling covered bond of the year on Friday, without needing to pay any premium over the tight trading levels of its existing bonds.