Société Générale

The Grand Duchy of Luxembourg has become the first European country to publish a sustainability bond framework and has mandated banks to prepare a debut deal in the format.

Corporate bond investors had another chance to pick up some spread on Tuesday after August had closed with a flurry of hybrids, with crossover trades from French nuclear power company Orano and Italian electricity company Enel.

All eyes in the primary euro public sector bond market are fixed on the expected arrival of Germany's green Bund this week, but there were still some other deals announced on Tuesday. Greece is sticking to its plan for a syndicated bond issuance every quarter and Berlin hopes to match the success of its compatriot Land NRW in the 30 year part of the curve.

Norilsk Nickel, the Russian metal and mining company which has found itself under heightened scrutiny in recent months after a series of major oil spills, is set to raise a dollar denominated benchmark bond this week. Russian telecom major Veon was also in the market for its second rouble offering in recent months.

The offices of London’s top banks are unlikely to fill up in the coming weeks, as firms are adopting a gradualistic approach to returning staff to their pre-pandemic workplaces.

Companies piled into the bond market with hybrid capital issues this week to raise €4.95bn between them, as syndicate bankers say that they are encouraging as many borrowers as possible to consider pushing out higher risk trades before raising senior debt.

Supply and demand for senior financial institution bonds was lukewarm this week, as issuers and investors favoured higher yielding products amid healthy market conditions. FIG deal arrangers are predicting that the trend is set to continue and that issuers will favour capital trades.

Total, the French oil and gas major, continued the strong run of hybrid trades in the corporate market this week, launching a chunky €1bn note 37.5bp inside initial price thoughts on a yield basis.

Communauté Française de Belgique returned in mid-August after a seventh month absence to print a slew of deals for a combined €404m, according to Dealogic.

Masraf Al Rayan, one of the largest Islamic banks in Qatar, was out on Wednesday with its second international sukuk. The deal is also the second from CEEMEA to hit the market following the brief summer lull.

Activity in the financial institutions bond market has picked up this week after a long pause in euro supply. Danske Bank and Belfius Bank were among the names looking to capitalise on the improving market conditions on Wednesday.

Investors piled into European corporate hybrids again on Tuesday, with Belgian chemical firm Solvay and Austrian oil company OMV out with well received trades.