UniCredit

Ferrovie dello Stato Italiane, the Italian state railway holding company, has signed a €600m loan package that includes an environmental element. Europe’s loan borrowers are following the bond market away from pandemic crisis funding and back towards sustainability-conscious financing.

BBVA surprised market participants by becoming the first bank to issue a Covid-19 response bond in Europe this week. There will be follow-on deals as the format catches on in credit markets — high grade corporates are looking to do deals too — but it is unlikely to be exploited as widely as it has been in the SSA market. David Freitas and Mike Turner report.

France impressed as it received a record €51bn order book and paid a small new issue premium with its first syndication since the outbreak of the Covid-19 pandemic. The sovereign was joined in the long end of the curve this week by two sub-sovereign borrowers as investor appetite for duration grows, with more supply expected to follow.

Commerzbank and Crédit Agricole this week showed that banks do not have to pay big premiums for subordinated paper, with investors regaining their appetite for risk during the coronavirus pandemic.

BBVA on Wednesday became the first European financial institution to launch a bond in the euro market to tackle Covid-19, unravelling the appetite for these type of bonds while undergoing a refinancing exercise.

Italy’s Ferrari in euros and the UK’s Southern Water Services in sterling won strong demand for new bonds on Wednesday, but the slowdown in issuance has got some syndicate officials wondering if the market is already winding down for summer.

Intesa Sanpaolo became the first Italian bank to raise funding during the coronavirus pandemic this week. It offered a healthy premium for its five year senior deal, but the bonds have performed very well in the secondary market.

Tim Hoffmeister has taken up senior positions in an M&A advisory firm and a management consultancy in Germany.

Some of Europe’s largest banks have taken large chunks of syndicated loan market share in EMEA this year, as the pandemic has prompted some institutions to flex their muscles and others to retreat.

Fitch cut the ratings of four Italian banks this week, triggering underperformance in the market and pushing some non-preferred senior bonds into speculative grade territory.

UniCredit began the year with a new template for growth but is now simply trying to help support clients through the crisis, while hoping that the deeper relationships being forged will endure, writes David Rothnie.

High grade corporate bond investors showed few signs of fatigue on Wednesday, as deals commanded comfortable oversubscription, despite the flurry of issues in recent days.