BBVA
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Beverage company Femsa became the third Mexican company in a week to sell euro denominated bonds on Monday, jumping on an ECB-driven rally in credit markets to sell €1bn of seven year paper. -
BBVA priced a well oversubscribed €1.25bn seven year with barely any new issue concession and a long way through the Kingdom of Spain’s spread.
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Cemex tightened its latest deal by over 50bp from initial price thoughts as the Mexican cement company was rewarded for a conservative starting strategy with a well-oversubscribed book.
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Fomento Económico Mexicano (Femsa) has mandated three banks for its debut euro denominated bond, which it will roadshow next week around the European Central Bank policy meeting.
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Not all emerging markets bond bankers may agree with the strategy — with certain deal-hungry New York dealers particularly vociferous in their opposition — but Latin American sovereigns are placing increasing faith in the euro market for their international funding, writes Oliver West.
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The Republic of Peru could become the third Latin America sovereign to issue in euros in 2016 after holding an investor call at 10.30am UK time on Monday.
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Concerns over the exodus of real money investors from the covered bond market were put to rest this week as a series of deals met exceptionally strong demand, with the sea change in sentiment being most conspicuous in the French sector.
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Argentina’s government reopened negotiations with holdout creditors on Monday after securing a $5bn loan from seven global banks last week.
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A trio of Spanish issuers launched the first covered bonds of the year from southern Europe this week but, with peripheral spreads widening sharply, conditions are not conducive to further supply.
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Financial institutions have taken an early plunge into additional tier one bonds this week, as European and US investors show willing to take on risk and put cash to work.
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BBVA, BFCM and BPCE met with strong investor demand for euro senior unsecured deals on Monday, as peripheral and longer dated debt proved no deterrent to buyers.
