Portugal

Caixa Económica Montepio Geral this week attracted strong demand for its first covered bond since 2009 and the first ever Portuguese deal with a conditional pass through (CPT) maturity.

Caixa Económica Montepio Geral has mandated lead managers to market the first publicly syndicated Portuguese conditional pass through (CPT) covered bond using a structure that is somewhat different to Dutch CPTs.

Investors piled into a Unione di Banche Italiane (UBI) €1.25bn 10 year Obbligazioni Bancarie Garantite on Monday, despite it offering no new issue premium and being the issuer’s largest and longest transaction in at least six years

Net FX sales by Chinese bank are down 75% month-on-month in August, an advisor to the People’s Bank of China urges push for renminbi internationalisation as the currency strengthens, and Portugal hires banks for its first Panda bond issuance.

National Bank of Greece (NBG) is poised to issue the first post-crisis Greek covered bond, having drawn confidence from the blowout reception Santander Totta won for its €1bn 10 year this week — the longest Portuguese deal since 2010. Bill Thornhill reports.

The Spanish central government’s stand-off with the executive in Catalonia over an upcoming independence referendum is failing to worry Bono investors — but some bankers believe the market could soon be hit by a bout of volatility unless an agreement is reached. The Spanish situation was in marked contrast to the country’s western neighbour, as Portugal enjoyed a strong week after regaining investment grade status from S&P.

Santander Totta took advantage of the paucity of peripheral 10 year covered bond supply, a Portuguese sovereign rating upgrade and buoyant credit conditions to issue a well received €1bn transaction on Tuesday. Meanwhile, PKO Bank signalled its intention to open books soon.

Liability management exercises are becoming de rigeur among Europe's capital-strapped banks, as market participants face up to a world in which regulators have the power to step in early and impose heavy losses on bondholders. Tyler Davies reports.

Moody’s has extended its review of Novo Banco’s senior debt ratings after the Portuguese bridge bank published details of its liability management exercise (LME) this week, warning that bondholder could suffer higher losses than the ratings agency initially expected.

Novo Banco has published the terms of a long-awaited liability management exercise, unexpectedly shifting its emphasis away from generating immediate capital gains.

Panda bonds are finally coming back to life after a dire first half. But although all the conditions are in place for an issuance boom, there is reason to doubt quite how high volumes will go.

The European Commission said on Monday that private equity firm Lone Star Fund’s planned acquisition of Novo Banco, the Portuguese financial institution, was in line with the European Union’s merger regulations.