Commentary & Deal Flow

Corporate

• No Supply

FIG

PRICED DEALS:

• VP Bank AG (exp. Issue rating of A3) announced a 7yr (3rd Nov 2033) Senior Non-Preferred offering, with a starting size of Chf100m. Initial pricing was SARON MS+110 to +120. Spread set at MS+112 when a new issue size was cited as Chf110m. The deal priced mid-morning on those terms.
  • The private bank based in Lichtenstein, with a senior rating of A1, is an infrequent visitor to the public markets, with their last offering a Chf155m 10yr senior non-preferred 7yrs ago which priced at MS+70 (mid point of guidance).

LIVE DEALS:

• Caixa Geral de Depósitos, S.A. (exp. Issue ratings of Baa1 / A / AH by Moody’s, S&P & DBRS) brought a €500m (wng), Green, Senior Preferred, Fixed to Floating, 4NC3 offering with IPTs in the area of MS+100. Books were first cited as above €2.25bn (exc. JLMs).
  • CGD brought a similar trade on the 13th of May, pricing a €500m, 6NC5, Green, Senior Preferred at MS+73 (29.5bps tighter than IPTs from a book of €1.2bn). In September last year, there was a near mirror trade when they priced a €500m, 6NC5 Green, Senior Preferred at MS+65 (35bps tighter than IPTs from a €2bn book).
• Investec Bank plc (exp. Issue ratings of A1 / A- by Moody’s & Fitch), brought a €500m (wng), 3yr, senior OpCo offering with IPTs in the area of MS+110.
  • Investec Bank plc’s last public € offering was in June of last year when they priced a €500m 3yr FRN at 3mth €+110. That aside the OpCo is an infrequent visitor to the market, with very few outstandings. Their HoldCo ‘Investec plc’ has been more active this year issuing two €500m public trades (a 6.5NC5.5 & a 6yr), & a £300m 10.5NC5.5 Tier 2.
• Fairstone Bank of Canada (exp. Issue ratings of Aa1 / AA by Moody’s & DBRS), mandated back on the 21st of September, brought their long anticipated inaugural 3yr €500m (wng) soft-bullet Covered Bond. The Covered Bonds are backed by Canadian residential mortgages. Guidance on the notes were in the area of MS+45. Books were first called over €1.1bn (inc. €100m JLMs).
  • FBC is not a frequent visitor to the public debt markets, & this is their first offering outside of the domestic Canadian markets. As such this is a debut covered bond backed by Canadian residential mortgages.

MANDATED DEALS:

• No Supply

SSA

LIVE DEALS:

• The European Union (rated Aaa / AA+ / AAA / AAA by Moody's, S&P, Fitch & Scope) brought its expected, Fixed Rate RegS Bearer dual tranche offering, comprising a TAP of its EU €6bn 3.125% October 2033, for a €5bn (wng) with guidance of EU 2.75% December 32 +11 area. There was also a new €5bn (wng), 15yr due 12th of December 2041 with guidance of EU 3.625% December 40 +10 area. With the transaction well telegraphed final terms came in early c.10:30am in Europe. The book on the Oct 33 TAP was over €61bn (inc. €3.75bn JLMs), with spread set at EU 32’s +9; & the Dec 41’s had a book of over €76bn (inc. €3.75bn JLMs), with spread set at EU 40’s +7.
  • Today’s offering represents the 9th major public funding offering in €’s YTD. All but one of these have been dual-tranche deals (10th March single tranche €9bn 10.75yr). Prior to today these deals have raised a collective €80bn, via 15 tranches. Their most recent issue was last month on the 15th, when they priced a €6bn 3.5yr at MS+6 (2bps tighter than guidance from a book of €72bn); & a €5bn 30yr at MS+3 (2bps tighter than guidance from a book of €80bn). The 3.125% 33’s being tapped today priced on the 12th of March this year. The deal was originally a €6bn 7yr, which priced at MS+9 (2bps tighter than guidance from a book of €85bn). Note that 13 out of 15 tranches brought this year have tightened 2bps from guidance; with 2 exceptions tightening by 3bps (€3bn 4.25yr from June & €3bn 3.25yr from April).

MANDATED DEALS:

• 13th October: The African Development Bank (rated Aaa / AAA / AAA / AAA by Moody's, S&P, Fitch & Japan Credit Rating Agency), mandated Barclays, Deutsche Bank, HSBC & Natixis, to lead manage its new 5yr, Social, € benchmark (Global SEC exempt) to be launched & priced 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.