Spain

The pace of government-guaranteed issuance picked up today (Wednesday), with an Austrian, a UK and possibly a German name joining in. Banks are said to be keen to complete deals ahead of the European Central Bank meeting tomorrow (Thursday).

Spanish and Dutch financial institutions are today (Tuesday) braving the government-guaranteed market after yesterday's turmoil. The two deals are coming wider than recent comparables, but are both understood to be going well.

Kommunalkredit Austria is in the market today (Friday) with a three year government guaranteed senior debt issue at a wider spread than was heard earlier this week, after Caixa Catalunya got its deal over the line yesterday (Thursday).

Caixa Catalunya today (Wednesday) announced that it has mandated Caja Madrid, Commerzbank, HSBC, LBBW, Natixis and Santander as joint leads for its first government guaranteed issue.

Moody's yesterday (Monday) downgraded Dexia Sabadell's cédulas territoriales from Aaa to Aa1. The rating remains on review for possible downgrade, where it was placed at the beginning of October.

Moody's today (Monday) cut the rating of Dexia Sabadell by three notches, from A2 to Baa2, and changed the outlook from stable to negative.

Banco Pastor is in the market today (Friday) with a three year Eu1bn no-grow government guaranteed issue that could put the latest Spanish deal 5bp inside where La Caixa opened issuance in late January.

Bankinter yesterday (Wednesday) printed its debut government guaranteed deal, soaking up investor demand left unsatisfied by preceding Spanish transactions in the guaranteed market. Its oversubscribed book bodes well for Banco Pastor, which today (Thursday) announced that it will follow with a government-backed benchmark.

Bankinter today (Wednesday) became the fourth Spanish bank to tap the government-guaranteed market. Elsewhere there has been little activity in the financial institutions market this week, although Standard Life Bank also launched a government-backed transaction today, in sterling.

Banco Popular yesterday (Monday) became the third Spanish issuer to price a government-guaranteed transaction, a Eu1.5bn three year bond that achieved the tightest level so far for the Spanish government-backed asset class. Supply of Spanish guaranteed debt looks set to continue, with a fourth Spanish bank today (Tuesday) announcing a mandate for its debut.

Ahorro Corporación Financiera (ACF), which runs the AyT Cédulas Cajas programme, and the Confederation of Spanish Savings Banks (Ceca) are setting up structures for pooled government guaranteed issuance by Spain's savings banks, which are eligible for up to around Eu50bn of guarantees under the Spanish scheme.

Banco Popular Español today (Monday) tapped the market with its debut government-guaranteed deal, the third from Spain, and will price the paper inside the levels achieved by La Caixa and Caja Madrid.