Scotiabank

Issuers are starting to feel more comfortable with the new normal of wider spreads as a flurry of deals dusted the Swiss franc market, including a rare operating-company level visit from UBS.

Even as sovereign restructuring and debt relief top the agenda for emerging markets bond buyers, investors are showing faith in the top names in the asset class. Tuesday was Chile’s turn; the sovereign breezed its way through two currencies, notching a negative new issue premium in dollars and becoming the first non-European sovereign to issue in euros since the Covid-19 crisis began.

Empresa de Transporte de Pasajeros Metro (Metro) could become the second Chilean government-linked issuer to offer bonds in the international market in less than a week, as investors say that the corporate market is likely to remain the preserve of the best-rated issuers.

A trio of agencies hit screens with dollar deals on Tuesday. Bank Nederlandse Gemeenten and CDP Financial tapped the three year part of the curve, while the Ontario Teachers’ Finance Trust reopened a five year market that had been shuttered by coronavirus-related volatility.

Bank of Nova Scotia issued its first dollar covered bond benchmark since 2016 on Wednesday. The deal follows a series of retained Canadian dollar covered bonds that were pledged to the Bank of Canada after it recently broadened repo eligibility to include the asset class.

Bank of China took Covid-19-linked bonds offshore on Thursday with a dual currency two year transaction, which was offered through its Macau branch.

The European Stability Mechanism has requested its primary dealers or ‘market group banks’ to set up entities within the 27 member states of the European Union in order for them to participate in bond auctions by the supranational and its sister issuer, the European Financial Stability Facility.

Sydney Airport has become the first borrower to issue a sustainability-linked US private placement.

Ontario printed a first green bond off its domestic medium term note programme this week, and the deal was over six times covered. Demand for green provincial paper is high, with Ontario coming a week after neighbouring Quebec.

Export Development Canada has mandated banks for its first dollar benchmark of the year in what has been a quiet week in the currency for public sector borrowers. SSA bankers expect activity in dollars to pick-up next week, despite a US public holiday on Monday.

Rating: Aa2/AA-/AA-

Demand for Quebec’s latest green bond was high with investors pouring into the C$500m ($376.2m) no-grow deal, leading to the books closing after only 20 minutes.