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Sub-sovereigns

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◆ No book update for €500m no-grow deal ◆ Surprising lack of demand for defensive trade ◆ Investors continue to cherry pick in big week for supply
◆ Spread to Land Hessen key to pricing ◆ Leads thought long and hard on whether to tighten ◆ 1bp move the right amount as book grew
◆ Three German states brought a new Joint Länder bond ◆ No book update, KfW curve guides pricing ◆ Flemish Community prints new 15 year
Second digital project won’t be the issuer’s last, Länder peers may be ‘interested and willing’ to join in
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  • Swiss franc investors made the most of a rare opportunity to buy Austrian sub-sovereign paper on Thursday when Land Niederoesterreich (Lower Austria) tapped its April 2021 and September 2023 bonds.
  • A difficult start to 2016 has led public markets looking subdued at best. Issuers and investors alike are turning to the private placement market to get deals done.
  • The Province of Ontario last Friday took advantage of a calm end to a volatile week, pricing its second green bond in Canadian dollars at the very tight end of guidance.
  • British Columbia became the first issuer to sell a Panda with a sub-3% coupon on Thursday as its triple-A rating assured investors who were largely unfamiliar with the credit. The Canadian province is parking the proceeds offshore after failing to get tax waiver from China regulators, picking a new bank as the home for its deposit.
  • The Chinese Panda bond market has gone from strength to strength since its revival last September with the Province of British Columbia (BC) becoming the latest to issue, raising Rmb3bn ($456m) on Thursday. While plenty more sovereign and financial deals are being lined up, the future does not look bright for red chip companies. Carrie Hong and Rev Hui report.
  • The Province of Manitoba has returned to euros early in 2016, printing €45m of 25 year paper through Scotia Capital.