Commentary & Deal Flow

Corporate

LIVE DEALS:

• AusNet Services Holdings Pty Limited (exp. Issue ratings of Baa1 / BBB+ by Moody’s & S&P), brought their anticipated (mandated 29th of Sept) €500m (exp), 10.5yr (21st April 2037), Reg S senior unsecured transaction. IPTs were in the area of MS+150.
  • AusNet last came to the public € markets on the 28th of April 2025, when they priced a €500m, 10yr at MS+130 (40bps tighter than IPTs). Ratings are unchanged since that issue. AusNet is an Australian diversified energy infrastructure business that owns & operates the primary regulated Victorian electricity transmission network, as well as an electricity distribution network in eastern Victoria & a gas distribution network in western Victoria.
• Danfoss A/S (exp. Issue rating of Baa1 by Moody’s) brought a 5.5yr, senior unsecured, Reg S, Bearer, €500m (wng) issue. IPTs on the trade were MS+120 to +125.
  • Having not issued in the public € markets since 2023, Danfoss tapped the market on the 25th of March with a €700m 7.25yr senior unsecured trade pricing at MS+95 (40bps tighter than IPTs from a book of €2.5bn). Danfoss is a Danish multinational engineering company that manufactures energy-efficient heating, cooling, power electronics, & hydraulic components used in building systems, industrial machinery, & electrification.

MANDATED DEALS:

• No Supply

FIG

LIVE DEALS:

• Landesbank Baden-Württemberg (exp. Issue rating of Aaa by Moody’s) announced a € benchmark      Hypothekenpfandbrief (Mortgage Pfandbrief), EU harmonisation label European Covered Bond (Premium). Books were above €1.3bn (inc. €200m JLMs).
  • This is the 4th Covered bond by LBBW in 2026, the last being a €1bn 4yr which priced at MS+11 (6bps tighter than guidance from a €1.65bn book), this last trade had no green credentials. Their €1bn 6yr covered trade on May the 19th was, however, a Green issue, which priced at MS+20 (6bps tighter than guidance from a book of €2.35bn). Lastly they brought a €500m 8yr covered on the 23rd of February at MS+22 (5bps tighter than guidance from a book of €1.18bn).
• Standard Life plc (exp. Issue rating of BBB+ by Fitch) announced a £300m (wng) fixed rate 30NC10, Tier 2 offering with IPTs of UKT+240 area. Books were first cited at over £1.5bn.
  • The borrower last tapped the markets with a £350m PerpNC8 restricted Tier 1 trade on the 14th of July. Most relevant to today’s trade was their 30NC10 Tier 2 offering back on the 28th of November 2023, which priced at Gilts+365 (30bps tighter than IPTs from a book of £1.75bn). For reference the coupon on this 2023 deal was 7.75% to yield 7.855%.

MANDATED DEALS:

• 21st September: Fairstone Bank of Canada (exp. Issue ratings of Aa1 / AA by Moody’s & DBRS), mandated RBC Capital Markets as Arranger & Sole Structuring Advisor, & BMO Capital Markets, DZ Bank, LBBW, Natixis & RBC Capital Markets as Joint Active Bookrunners for an inaugural 3yr € benchmark soft-bullet Covered Bond. The Covered Bonds are backed by Canadian residential mortgages. This is the borrower's debut covered bond. The investor roadshow concluded with consensus feedback in range fair value flat/small bps inaugural premium to EQB. c.50 investors involved through the marketing process. An inaugural 3yr Covered Bond may follow as early as this week.

SSA

LIVE DEALS:

• The Federal State of Saxony-Anhalt (rated Aa1 by Moody’s & Fitch), brought their expected €500m (wng) inaugural Green, fixed rate senior, unsecured Landesschatzanweisung (LSA) offering. Guidance on the trade was in the area of MS+13. Books were in excess of €535m (inc. €65m JLMs) when spread set at MS+13.
  • This is their 3rd meaningful (>€100m) public senior unsecured € offering YTD, having last priced a  €500m 2yr on May 19th at MS-1 (1bp tighter than guidance from a €1bn book). Before that was a €1bn 10yr on the 27th of January that priced at MS+25 (2bps tighter than guidance from a €4bn book).
• The City of Dortmund (unrated) brought their anticipated €150m (min) 7yr Stadtanleihe (municipal, ‘city’ bond), senior unsecured offering. The issue is 0% risk weighted, LCR Level 1. Guidance on the trade was in the area of MS+53. Books were first called above €360m (exc. JLMs), rising to over €370m (exc. JLMs). Spread set at MS+50.
  • This is Dortmund’s second issue this year, having printed a €200m 9yr which priced at MS+49 (4bps tighter than guidance from a book of €445m). This trade was announced as €150m (min) & was upped by €50m. They only priced the one trade in 2025; a €150m, 7yr at MS+65 (5bps tighter than guidance, from a book of €390m). They are not a frequent borrower, hence they don’t feel the need for a rating as their targeted educated investors know full well that they are a solid sub-sovereign IG credit. Were they to be issuing in greater size & greater frequency then credit ratings would likely be required.

MANDATED DEALS:

• 12th October: The European Union (rated Aaa / AA+ / AAA / AAA by Moody's, S&P, Fitch & Scope) mandated BofA Securities, Goldman Sachs Bank Europe SE (DM/B&D), LBBW, Morgan Stanley & Santander as Joint Lead Managers for its upcoming € benchmark, Fixed Rate RegS Bearer dual tranche transaction, comprising a TAP of the EU 3.125% benchmark October 2033 (EU000A4EUY43) & a new 15yr benchmark due 12th of December 2041. No further group. The transaction will be launched in the near future, subject to market conditions.
• 7th October: The Grand Duchy of Luxembourg (rated Aaa / AAA / AAA by Moody’s, S&P & Fitch), mandated Barclays, BCEE, BGL BNP Paribas, Citi & Credit Agricole CIB as Joint Lead Managers to arrange a series of virtual fixed-income investor calls in relation to its upcoming Inaugural 10yr, € benchmark fixed rate Digitally Native Securities. The Digitally Native Securities will be issued on a distributed ledger technology (DLT) platform operated by LuxCSD S.A. (D7 DLT Platform). The Digitally Native Securities are also eligible for clearance & settlement though Clearstream Banking & Euroclear Bank SA/NV. The transaction is expected to be launched & priced in the near future, subject to market conditions. RegS Bearer, CAC, FCA/ICMA stabilisation.
  • A digitally native securities is a bond, issued, & managed directly on a blockchain or distributed ledger from inception, rather than existing first as a physical certificate & then tokenized latterly. By incorporating smart contracts into their core design, such bonds automate dividend distributions, compliance checks, & settlement, offering near-instant clearing, enhanced transparency, & continuous 24/7 trading without relying on legacy clearinghouses or paper registries.
• 6th October: His Majesty’s Treasury (HMT) of United Kingdom has mandated Barclays, HSBC, Lloyds, Morgan Stanley, NatWest & RBC for its Digital Gilt Instrument (DIGIT) pilot issuance following a competitive procurement process. The transaction is expected to take place by Q1 2027. This follows the appointment of HSBC as the Distributed Ledger Technology (DLT) supplier in February, & the announcement in July that HSBC & LSEG have signed a memorandum of understanding to deliver a bilateral Digital Securities Deposit link.

• To view the LIVE / REAL TIME European IG pipeline please click here.