Lloyds Bank

Europe’s corporate bond new issue market is distinctly subdued as Easter Week begins. Investors, issuers and banks alike feel the market could do with a gap to digest the very heavy issuance earlier this month. This week brought two liability management deals, one with a new issue.

JD Sports, the UK casualwear company, is set to break into the US market by buying Finish Line for around $558m. The acquisition will be financed in the loan market.

Lloyds has combined its corporate DCM and financial institutions DCM operations in a single division, run by David Carmalt, former head of financial institutions DCM. Guillaume Fleuti, who headed corporate DCM, will run a new combined infrastructure group at the bank.

UK property company Hammerson has signed a new £1.5bn three year revolving credit facility, bringing in a dozen banks for a financing aimed at slashing the funding costs of its acquisition target, Intu.

Spanish utility Iberdrola had significant success with its debut green hybrid bond in November when it received €3.2bn of orders. However, its second such bond failed to tighten from initial price thoughts when it was issued this week.

Lloyds Bank issued its third covered bond of the year on Tuesday and its second in sterling, paying a fraction of the premium seen in the senior unsecured market, despite the large deal size.

UK property company Hammerson has signed a new £1.5bn three year revolving credit facility, bringing in a dozen banks for a financing aimed at slashing the funding costs of its acquisition target, Intu.

Two new SRI corporate bonds were priced on Monday, but with very different results. Iberdrola’s green hybrid bond failed to tighten from initial price thoughts, while Danone’s debut social bond had to pay just 2bp of premium.

It was no surprise to many market participants that Friday saw no new issuance in the corporate bond market after the busiest week of 2018. The conundrum to be solved now though is how the jumbo issuance will affect conditions in potentially the final full week before Easter.

The preference share market is in disarray after Aviva asserted that it could cancel its instruments at par, a decision that has been derided by fixed income investors of all stripes and is now being examined by UK market regulators. Tyler Davies reports.

Lloyds issued its first euro covered bond in almost two years on Thursday, helping to assuage Brexit concerns by pricing the €1bn seven year with a positive spread to mid-swaps.

Three sterling deals this week matched the busiest week of 2018 for the currency as two UK corporate issuers returned to the market after notable absences and a US issuer opted for sterling for its first non-dollar deal.