Société Générale

Fewer investors than is normal bought Stadshypotek’s seven year covered bond on Tuesday. However, although the deal had virtually no new issue concession, it was nevertheless well subscribed.

French covered bond issuer BPCE attracted almost €1.4bn of demand for its seven year as the need to price over OATs conferred a generous new issue premium. But with French covered bonds trading much tighter than OATs in the 10 year tenor there is a growing sense that a new 10 year issue could soon price much tighter than France.

Rating: Aa3/AA/AA-

Equity-linked bond issuance, lagging behind demand in Europe, showed a burst of vigour on Thursday with the launch of three deals, including substantial convertibles for Vinci and Severstal that were both eagerly received.

Fears of a far-right win in the French presidential election have left the country’s banks in a tricky position. They need to raise large amounts of non-preferred senior bonds this year but, with spreads so volatile, any attempt to do so is likely to be fraught with risk and expensive.

France’s Klepierre printed a €500m 10 year trade on Thursday, with bankers still waiting for a euro issuing corporate to take the step and stretch maturities in the currency further.

Société Générale showed it was on a steady forward march on Thursday, posting a robust set of results that benefited from resilient performances across both its retail and investment banking arms.

Elis, the French bed linen and laundry company, has completed its oversubscribed €324m rights issue to finance the reduction of its leverage after buying competitors Indusal in Spain and Levebras in Brazil.

Severstal looks set to add to the growing surge of Russian supply with its plans, set out on Thursday, to meet investors ahead of a potential dollar bond.

Latvia is on course to become the first Baltic state to tap the 30 year maturity after emerging with pricing on a dual tranche euro deal.

The IPO market in EMEA is enjoying mixed fortunes, with the successful completion of the largest flotation in Russia since 2014 and the withdrawal of the first German IPO of the year late on Tuesday due to a lack of demand at an acceptable price.

AlzChem, the German niche chemicals producer, has postponed its €174m Frankfurt IPO, blaming difficult market conditions.