TD Securities
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It was a week of firsts for the socially responsible investment sector, with several issuers bringing innovations or printing record sized deals.
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Bank Nederlandse Gemeenten sold its largest ever sustainability bond and the European Investment Bank added a new currency to its climate bonds on Tuesday, as a draft standard was launched for the market.
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Socially responsible investors received a fresh menu of bonds on Monday, with a borrower announcing an inaugural climate bond, a regular SRI issuer entering a new currency and an agency returning to its sustainability format.
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Royal Bank of Canada issued the first dollar denominated Canadian deal in three months at the widest spread this year, while Münchener Hypothekenbank supplied the only euro deal of the week.
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A supranational issuer fell just short of full subscription with a four year dollar deal on Wednesday, as SSAs looked for favourable pricing opportunities with unconventional maturities and short dated floaters.
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Size is still coming at a price for SSA borrowers, with European Investment Bank paying a slightly elevated new issue premium for a $4bn five year on Tuesday. Despite this, bankers said a second trade from Erste Abwicklungsanstalt confirmed the market is in robust health.
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The higher level of new issue premium SSAs have to pay in dollars is set to be showcased this week, after a pair of European borrowers hit screens on Monday with benchmarks in the currency.
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Several public sector borrowers are tipped to come into a reopened dollar market next week — but some SSA bankers warned that conditions are still not at full strength.
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Conditions across both euros and dollars are as healthy for public sector borrowers as they have been for several weeks and, while issuance was low this week, bankers are confident that volumes will grow.
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A German agency is set to bring the second dollar benchmark from an SSA this week — quadrupling the number of such deals in September so far.