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The swathe of euro-denominated issuance that has started and is expected to continue in the emerging markets ought to boost the league table positions of some of the European banks that have been breaking into these regions. -
Conditions for issuing bonds and sukuk in Dubai look great, but mid-way through January there is still barely a glimmer of a deal. Those borrowers that need to come to market this year would do well not to miss their chance.
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The Luxembourg government’s introduction of a sukuk bill has raised the possibility that it might stump the United Kingdom’s bid to issue the first European sovereign Islamic paper. But rather than causing alarm among UK Islamic finance practitioners, this competition for the limelight should be celebrated as a win-win for the market.
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The United Kingdom is right to lean on Turkey for advice in placing its inaugural sukuk issue. Turkey’s experience in tapping the Islamic market was hard won and is valuable to new sovereign issuers. But the UK should prepare to pay the favour forward even if keeping its own counsel might allow it to command tighter pricing by keeping sovereign sukuk supply scarce.
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As an important step in its revival, the CMBS market should rightly celebrate Goldman Sachs’ sale of bonds backed by Italian shopping centres. But the market has not yet played to its strengths and engaged with the more highly levered parts of the property market.
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The post-crisis era, in which ABS investors have been highly rewarded for taking minimal risks, is coming to an end. Spreads in peripheral and non-core bonds have raced in, more accurately reflecting the underlying risks involved. It’s time for regulators to follow suit and ensure new rules do the same thing.
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The post-crisis era, in which ABS investors have been highly rewarded for taking minimal risks, is coming to an end. Spreads in peripheral and non-core bonds have raced in, more accurately reflecting the underlying risks involved. It’s time for regulators to follow suit and ensure new rules do the same thing.
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According to Barclays analysts, EM bonds are going to have a bumper year for issuance next year. But that flies in the face of every warning that syndicate and origination officials are giving about the likely fragility of the EM primary bond market in 2014.
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The high yield market has a new risk: long-dated bonds. Unitymedia's daring €475m 15 year deal opened a new frontier for the high yield market. Bankers say not every company could issue that long, but you can bet they will think about trying to repeat the deal. Investors, however, should be on their guard.
