UK

UK banks and building societies are struggling with difficult aspects of incorporating climate change into their risk management, as demanded by the regulator, a PwC survey has found. The answer to some of their problems could be a non-risk initiative: science-based targets.

Markets rejoiced this week after the Bank of England proposed policy changes that will make it harder for UK lenders to run into automatic restrictions on their additional tier one coupons and equity dividends. The move was seen as a way of addressing concern about ‘buffer usability’, which has come to the fore during the Covid-19 pandemic.

Prudential rules will become more supportive for UK banks after Brexit.

The secondary market in Schuldscheine is rudimentary, partly as the arranging banks have never wanted to encourage it. But a little known brokerage firm is quietly acting as a go-between, helped by its contacts with non-traditional investors, writes Silas Brown.

Shaftesbury, the UK real estate investment trust that owns swathes of London’s West End, is tapping its shareholders for almost £300m ($392m) amid a severe downturn in the theatre district because of the Covid-19 pandemic.

Coventry Building Society (CBS) has set up a second covered bond programme that is secured exclusively on the mortgages originated under its buy-to-let Godiva platform, which had previously been funded through its Mercia RMBS programme. Although the covered bonds require more collateral to reach the same rating, they offer greater funding flexibility as they can be pledged for repo and are eligible for the liquidity coverage ratio.

Bavarian dairy group Müller is marketing US private placements, according to market sources, alongside nutrition group Glanbia.

Metro Bank said on Wednesday that it had slipped below its loss-absorbing capacity targets. But before it commits to issuing more senior debt, it is waiting for the Bank of England to complete a review of the minimum requirements for own funds and eligible liabilities (MREL).

The Bank of England said this week that it would loosen some of the rules around the maximum distributable amount for UK banks after Brexit, making it harder for them to trigger restrictions on their additional tier one (AT1) coupons and equity dividends.

UnipolSai Assicurazioni was nearly three times subscribed for a restricted tier one (RT1) this week — the first of its kind in Italy. An attractive coupon helped to offset any concerns about Italian sovereign risk or a lack of liquidity in the RT1 market.

Getlink, the company that operates the Channel Tunnel, is preparing a €700m high yield green bond to refinance its 2023 bonds and raise cash for capex, including finishing off a landmark electricity connection between the UK and France. The refi comes after it negotiated waivers on the covenants in its term loan to deal with the impact of the pandemic.

Quadgas, a gas asset and infrastructure investment consortium that sits above UK utility Cadent Gas, has launched a US private placement, in the first whiff of a deal from the sector in the UK for more than six months.