Spain

CaixaBank and BayernLB were able to sail through fair value with green non-preferred senior deals this week, bucking a trend for rising new issue premiums in 2021. Bankers say a lack of supply is finally helping borrowers to exert more power over their pricing.

Banco Santander has followed Belfius Bank in launching a very successful new seven year bond this week, as bank treasury accounts lend their support to low yielding preferred senior paper.

Cellnex, the Spanish telecoms infrastructure company, has returned to the equity capital markets with a huge €7bn rights issue to finance its acquisition of French competitor Hivory from Altice and KKR.

BayernLB was able to close the books on its debut green bond after only three hours on Wednesday, as investors piled into the tightly priced transaction.

CaixaBank found €3.7bn of demand for a green senior bond on Tuesday, as investors revealed their hunger for new paper. BayernLB could follow with a green deal of its own against the improving backdrop in euros.

Rhône Capital has reduced its stake in Fluidra, the Spanish swimming pool company, through an accelerated bookbuild.

Few deals have ever had €75bn of orders. Spain managed to lose that much, but still have €55bn remaining in the book. This is the world the ECB’s purchase programmes have built.

Rating: Baa1/A/A-

A book of more than €55bn for a €10bn bond priced with a new issue premium of 1bp would be a gratifying outcome for any sovereign issuer. But Wednesday's syndication for Spain instead attracted robust criticism over price moves during bookbuilding which derailed what was on course to be the biggest order book in bond market history.

In a dramatic and unprecedented turn of events on Wednesday, Spain went from being on track to attract the biggest ever order book for a bond issue to losing more than half of its orders, as it slashed the spread of its new 10 year syndicated bond, leaving either a negative or very skinny new issue premium.

Spain is planning to issue its hotly anticipated inaugural green bond in the second half of the year through syndication in what will be the first step in the sovereign’s ambition to become a regular green issuer and build out a curve in the format.

Banco BPM was unable to tighten through initial price thoughts for a new additional tier one on Tuesday, as it looked to maximise its regulatory allowance for the asset class.