Spain

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The Basque Government this week gave one of the best signs that investor worries about Italy’s political situation are unlikely to spill over to other countries as it printed a three times subscribed debut sustainability bond.

Cajamar Caja Rural found good demand for a €500m five year Cédulas on Thursday, suggesting that investors are differentiating between Spanish and Italian bank risk, and with a further spread widening anticipated, peripheral issuers have every incentive to consider follow-on deals.

The Basque Government’s return to bond markets on Tuesday after a more than two year absence suggested that investors are not duly concerned about Spain being caught up in volatility last week, with orders ploughing into the debut sustainable bond issue.

The Basque Government will bring the first real test of investor appetite for Spanish public sector risk since a wave of Italy-led volatility hit the eurozone periphery last week, as it opened proceedings on an inaugural sustainable bond — its first issue of any kind in over two years.

The International Capital Market Association chose its 50th anniversary AGM to appoint its first ever female chair to lead its board and oversee how the association determines best practices for the capital markets.

An escalation of political risk in Italy has rattled investors, substantially increasing hedging activity this week as concerns ramped up about the future of the eurozone.

Talos Capital reduced the size of its stake in Aena, the Spanish state-owned aiport operator, through a €696m accelerated bookbuild led by UBS and Citigroup on Tuesday.

Caja Rural Navarra’s fruitful return to the covered bond market last week was underpinned by several important elements, not least its decision to update and improve its sustainability framework. In the context of the European Central Bank’s diminishing support, the bank’s efforts offer a salutary guide to other borrowers, who will soon be obliged to compete harder for investors’ attention.

Santander has hired a new covered bond trader who shares the same name as the trader it recently lost.

Caja Rural de Navarra (CRN) priced the first Spanish covered bond in almost three months flat to its curve and with the highest subscription ratio of any investment grade (IG) covered bond issued this year. The recently upgraded sustainable offering, which was rated six notches above the Kingdom of Spain, also offered a rare spread pick-up over the sovereign.

Caja Rural de Navarra (CRN) mandated leads on Tuesday for a €500m seven year sustainable covered bond which is likely be launched on Wednesday. At the same time, Landshypotek Bank AB mandated leads for a roadshow to present its green framework ahead of a five year Swedish krona covered bond benchmark.