Santander

Banco Santander broke new ground in the additional tier one market on Tuesday, when it said that it would not be calling its €1.5bn 6.25% bonds. Many investors were stunned and even angry about the bank’s actions, which could have major implications for the way in which call decisions are viewed across the sector.

Blackstone Property Partners Europe on Friday made its third visit to the corporate bond market in eight months and opted for a maturity between its two outstanding bonds. The property fund has now printed €1.75bn of bonds since it sold its Logicor logistics business to China Investment Corp in June 2017.

Many of the assumptions that surrounded older iterations of perpetual bank capital instruments are still there in the new class of additional tier one securities.

Rating: Baa1/BBB+/BBB

The theme in the euro public sector market this week was large book sizes despite issuers paying very little concession, with Finland, the European Investment Bank (EIB), Madrid and the Joint Länder all keeping close to their curves.

A last minute additional tier one deal from Banco Santander this week had investors crossing their fingers in the hope that they can survive 2019 without seeing a bond being extended past its first call date.

On Thursday, Imperial Brands bucked the recent trend of ethical and sustainable corporate bond issuance, but found plenty of demand for its latest deal. The UK tobacco group had not accessed the bond market for more than two years.

Banco Santander opened books on a new additional tier one deal in dollars on Wednesday, surprising market participants who thought the Spanish bank would not refinance an older series of euro notes before their call date on March 12.

All three public sector borrowers in the euro market on Tuesday received record order books, despite the spreads tightening by up to 5bp during pricing — which left little to no concessions for investors.

Latam Airlines returned to the bond market for the first time in almost two years, printing $600m of seven year paper.

Demand for corporate bonds is strong but it is at its strongest for green and hybrid debt, especially for deals that combine both qualities. On Tuesday, Spanish utility Iberdrola found similar demand for green hybrids to that which Engie and EDP had benefited from in January, and market participants are starting to revise their issuance forecasts for the asset class.

Finland and Madrid hit screens on Monday to capitalise on the red hot appetite for euro sovereign supply in the 10 year part of the curve.