UniCredit

Yapı ve Kredi Bankası is planning an additional tier one dollar benchmark that looks likely to be the first issue of non-sovereign international bonds from the country since April.

The European Financial Stability Facility rebooted the euro public sector market on Monday with an intraday execution ahead of what SSA bankers expect to be a busy week for supply. Belgium and KfW are already on screens for benchmark trades in the 10 year part of the curve.

Bank of Nova Scotia and BayernLB found good demand for their covered bonds issued in the belly of the curve on Friday, but UniCredit AG (HVB) experienced a more challenging sales process for its 10 year Pfandbrief. Crédit Agricole will be hoping for a better reception when it issues a 10 year next week.

As is becoming traditional in the European corporate bond market, car finance issuers sold the first new issues of the year. The fact the market had to wait just one day was a positive, considering that the backdrop was largely unchanged from the end of 2018, when the market had been difficult to access. However, there were some warning signs other issuers will do well to heed.

The covered bond market is likely to remain equally busy on Friday as it was on Thursday with a further three deals mandated. Bankers say next week could become even more frenetic.

The European corporate bond market had to wait just one day for the first new issue of 2019. Some participants had expected volatility in the global financial markets to result in a blank first week for corporates, but finance subsidiaries of Renault and Toyota opted to start their financing for the year on Thursday.

Russian shipping firm Sovcomflot has closed a $264m club facility with five international lenders, although the outlook for Russian companies in the syndicated loan market remains questionable going into the new year.

Austria’s Verbund has joined the ESG-linked revolving credit facility fray, with the electricity company signing what leads say is the first such deal in the country.

Russian Copper Co (RCC) has closed a $250m five year credit facility, marking the second refinancing that RCC has secured this year. The tight margin sparked a sliver of optimism in the market.

Rising interest rates in the US have created a roaring market for convertible bonds. Europe’s barren market has been put to shame — it risks being the driest year for two decades. Going into 2019, Europe is likely to remain in the shade of the US, but there are hopes of an issuance rebound — that is if interest rates ever start to rise. Aidan Gregory reports.

Capital instruments issued by financial institutions under previous regulatory regimes was a topic of contention in several instances this year. With regulators set to lay down further positions, legacy capital will remain on the agenda in 2019.

Caius Capital and UniCredit have settled a dispute over a hybrid capital instrument issued by the latter. Caius will pay the bank an undisclosed sum, after UniCredit sought around €90m of compensation for damages back in August.