UniCredit

Bank borrowers returned to a stronger euro bond market on Tuesday, but deal arrangers warned of lingering concern over rates and inflation as KBC Group struggled to draw a crowd for a long-dated offering.

Volatility subsided amid a series of public holidays in Europe on Monday, raising hopes for a busier week of bank bond supply.

UniCredit will skip a coupon on one of its legacy capital instruments this month, after stating that a net loss in 2020 means it no longer needs to make the payment. Investors were surprised by the decision, which many saw as a U-turn.

Mondadori Group, the Italian book and magazine publisher, has signed €450m of loans from four banks, with the borrower slashing 25bp off the margin as competition to lend to mid-caps soars in Europe.

Sustainable bond issuance from central and eastern Europe is set to rise as issuers face growing pressure from investors to show they are embarking on the transition to a lower carbon economy, even if governments in the region are still dragging their feet, writes Jon Hay.

The Polish oil refiner and petrol retailer PKN Orlen launched its debut green bond on Thursday. The trade is one of the very first of its kind from an oil company.

Ryanair, the Irish budget airline, landed a far more solid bond issue on Tuesday than shopping centre operator Unibail-Rodamco-Westfield had a day earlier, as both companies try to recover in sectors ravaged by the coronavirus pandemic.

Momentum is picking up among Russian borrowers seeking to raise green or ESG-linked loans. Sibur, the petrochemical company, is the latest borrower to enter the market, which bankers say is attracting companies from all over the spectrum.

CDP Financial, one of Canada's largest public pension asset managers, joined three other public sector borrowers in the dollar market on Tuesday to sell its debut green bond.

PKN Orlen, the Polish oil refiner and petrol retailer, began marketing its debut green bond on Monday, a €500m no-grow seven year. Issuing a green bond would be a bold move for an oil company, but PKN Orlen is being conservative about the assets included and has obtained certification from the Climate Bonds Initiative.

Grünenthal, the German opioid maker, has signed a €400m revolving credit facility, less than a month after making its postponed debut in the high yield bond market.

Bausparkasse Wuestenrot dropped into the MTN market in search of covered debt earlier this week, ahead of its forthcoming debut public senior deal.