Spain

The Euromoney Smaller European Companies Index Series currently comprises 1350 companies across 16 European countries.

The Spanish Cédulas outlook is set to improve, not just because the economy is experiencing one of the strongest growth rates in Europe, but also because legislative proposals will bring the market into line with best practice. However, there is still no consensus on how the proposals will be implemented, said panellists at the European Covered Bond Council’s plenary session in Barcelona on Wednesday.

Kutxabank has mandated leads for Spain’s first social covered bond which is expected to be priced next week. This will be the third covered bond with assets that have an environmental or social remit and the second year.

Caja Rural De Castilla-La Mancha, UniCredit Italy and Banca Popolare di Milano named leads for prospective euro covered bond benchmarks. The two Italian deals are likely to emerge next week but the Spanish deal will not follow until after a roadshow.

Shares in Abengoa, the troubled Spanish renewable energy company, plunged again on Thursday and its credit default swap spread widened sharply, on unconfirmed reports in the Spanish press that banks including Bank of America Merrill Lynch, Citigroup and Société Générale had declined to underwrite its rights issue.

UniCredit Bank Austria (Baca) returned to the covered bond market on Tuesday to issue the first Austrian Pfandbrief since the country’s Financial Markets Authority (FMA) announced a debt moratorium on bonds issued by Heta Asset Resolution AG (HAR).

Spain’s 10 year borrowing costs rose at an auction on Thursday to more than double their low for the year so far.

A resurgent Spanish corporate finance market is putting the expansion plans of Spain’s national champions to the test, at home and abroad, writes David Rothnie.

Ardian, the French investment firm formerly known as Axa Private Equity, has opened a new office in Madrid to reinforce its relationships with corporations and clients in Spain.

Traders this week reversed the recently growing dispersion among some of Europe’s widest iTraxx Crossover credits, with Abengoa rallying sharply as three banks backed the company’s rights issue. But the reprieve was brief and against the tide, say some participants.

Was it all a dream? At the start of the week the markets were in the throes of a full-blown panic, with talk of “Black Monday” and plentiful comparisons with the Lehman collapse. Yet barely three days later, the iTraxx Europe was back trading at 70.5bp, exactly the same level it was quoted at a week ago.

Levfin specialist firm DebtXplained on Thursday said covenants on Abengoa’s €375m unsecured bond leave investors less protected than on competitors’ notes.