Switzerland

It may be a quieter summer for bankers on Zurich syndicate desks than many had hoped or expected as the effects of renewed monetary easing in the eurozone knocks back Swiss franc swaps, strengthens the currency and lessens the demand for bonds, said bankers this week.

Financial institutions piled most of this week's debt supply into a busy Monday session, with BPCE, Crédit Agricole, Credit Suisse and KBC Group all launching senior deals for the minimum requirement for own funds and eligible liabilities (MREL) at the same time. All four lenders came close to fair value for their offerings.

Having been subdued early in the week by Monday’s public holiday and declining swap rates, the Swiss franc market burst into life on Thursday morning when Commerzbank and Credit Suisse opened the books on a new dual-tranche offering for Orange (Baa1/BBB+/BBB+).

Activity in the FIG sector in Swiss francs shifted from the international to the domestic market this week, with a little over Sfr850m ($857m) of new supply priced on Tuesday alone.

Credit Suisse Group made its debut in the Singapore dollar market on Wednesday, finding a significant price advantage for its perpetual tier one bond in the new currency.

It may have been a short week for Swiss franc investors, bookended by public holidays overseas and at home. But that did not stop them responding ravenously to Tuesday’s dual-tranche debut transaction from Kühne + Nagel, the borrower having presented to investors on Monday during a lunch in Zurich and a breakfast in Geneva the following morning.

The Swiss franc market for corporate borrowers sprang back to life this week, with more than Sfr1bn priced within a single session on Wednesday. Even against the backdrop of demonstrable pent-up demand for corporate exposure among investors, Zurich-based bankers said they were pleasantly surprised by how effortlessly the market absorbed this week’s new supply.

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Zuercher Kantonalbank added momentum in the Swiss franc market for sustainable bond issuance at the end of last week, when it launched its second green bond. The proceeds of this Sfr200m ($198m) trade are for refinancing existing and future facilities under its Umweltdarlehen (environmental loans) programme, which dates back to 1992.

Korea Railroad Corp turned west on Monday, marketing a six year bond to Swiss investors.

Vaduz-based Liechtensteinische Landesbank (LLB) kicked off Swiss franc bond issuance after an investor lunch in Zurich on Monday with its debut Sfr150m seven year senior preferred.

In a week shortened by a public holiday, the only borrower to put its head over the parapet in the Swiss franc bond market was Pfandbriefzentrale der Schweizerischen Kantonalbank, the issuance vehicle owned by Switzerland’s 24 Cantonal banks.