UK

The UK’s new insolvency law came into force on Friday, and lawyers have been spending the weekend picking through its 250 pages to understand the implications. While some have welcomed it, others pointed out that in its haste to push it through Parliament, the government has introduced several changes that skew the balance between various kinds of lenders which hitherto had been treated equally.

Hannover Re gave away a bit of premium for a new tier two this week, after it touched on the lower bound of the spreads available in the market for insurance capital.

Aston Martin, the UK car maker returned to equity markets on Friday morning to raise yet more equity capital after completing a rights issue in April. The company has sold a stake worth 19.9% of its share capital to allow a new management team to rebuild the company.

A worsening in credit conditions has squeezed some borrowers across EMEA out of syndicated loans and into the bilateral market. As syndicated loans bankers face another year of disappointing figures, market players are split over whether this trend will leave a more permanent dent in volumes. Mariam Meskin and Jon Hay report.

Speaking at a Treasury Committee hearing on Wednesday, Sir Robert Stheeman, chief executive of the UK’s Debt Management Office, said that he was not concerned about the Bank of England’s decision last week to slow down the pace of Gilt purchases until the end of the year.

Private debt blossomed after the last financial crisis, as European companies grew more sophisticated and sought to diversify their funding strategies away from bank loans and bond markets. But the coronavirus has highlighted its shortcomings, particularly around speed of execution. It may be hard to regain the momentum.

Wednesday evening proved a busy night for equity bock trades, despite wider sell-offs in secondary markets over fears of a second wave of Covid-19.

The UK government showed this week that it plans to differ from the EU in its approach to banking regulation after Brexit. Divergence will begin with the minimum requirements for own funds and eligible liabilities (MREL), but a new consultation opens the way for further changes.

UK airline EasyJet has raised £418m of fresh capital to bolster its balance sheet after reporting a significant half year loss because of the impact of the Covid-19 global pandemic on its business.

Skipton Building Society announced on Wednesday that it was looking to buy back one of its senior bonds. The tender offer will give investors a premium over secondary market and help the issuer optimise its liability base.

Royal Bank of Scotland and ING were set on Wednesday to add to a recent run of dollar bond issuance from European banks, with some issuers having clocked up huge savings in the currency versus what their home markets can offer.

The repeated presence of European issuers in the bond market of late is testament to the prudence with which they are building up capital for what could be tough times ahead.