UBS

UBS and Credit Suisse tackled the damage to their profitability from the Swiss National Bank’s abandonment of the Swiss franc-euro peg in their full year results this week.

Covered bond issuer PS Hypo sold the first syndicated Swiss franc bond with a negative yield on Wednesday as part of a Sfr965m ($1.0bn) four-tranche deal.

With up to $50bn of additional tier one deals expected to hit the bond markets this year, bank funding teams are praying that this evolving but crucial asset class can settle down and help them meet their capital needs.

An incredible streak of record breaking low yields skipped through the covered bond market this week as issuers from Germany and France set new records, while another outside the Eurozone issued the first deal longer than 10 years with a coupon below 1%. Despite the low level of return, investors piled into all three euro transactions.

UBS has won a High Court fight with the hedge fund which formerly backed its structured products business, with the judge agreeing that deep cuts in UBS’s fixed income division did not breach the terms of the agreement.

Rating: Ba2/-/BB

Metro Pacific Investments Corp (MPIC) raised Ps8.9bn ($200m) on February 9 through a top-up placement dominated by demand from long-only funds, as investors took advantage of growth opportunities available in the Philippine stock market. But the action behind the scenes in the run up to the deal was far more exciting, with UBS stealing the show from some of its rivals.

RAG Stiftung, the German state-backed foundation set up in 2007 to support the environmental transition of the country’s coal mines, issued a €500m exchangeable bond on Wednesday at a negative yield.

UBS scooped another block trade in Hugo Boss shares on Monday night, for €918m, following the €500m underwritten trade it had conducted in December. Private equity firm Permira has been selling down its stake – and there is probably now just one block trade left to do in the stock.

UBS announced its fourth quarter results on Tuesday, reporting growing investment banking profits as a strong advisory and equities business helped to combat a torrid quarter for fixed income. However, it also warned that the increased value of the Swiss franc, along with negative interest rates in Switzerland and the eurozone, would likely damage its profitability in the future.

BBVA is looking to cut the cost of raising additional tier one capital on its third such transaction in two years, announcing initial price thoughts of high-6% area for a perpetual non-call five year trade in euros, compared to the 7% it paid to sell a euro perp non-call five year in February 2014.

Metro Pacific Investments Corp (MPIC) raised Ps8.9bn ($200m) on the evening of February 9 through a top-up placement dominated by demand from long-only funds, as investors took advantage of growth opportunities available in the Philippine stock market.