Swedbank

Sweden’s Volvo Car, a car maker, has become the latest company under pressure from the coronavirus pandemic to sign a state-guaranteed loan, as bankers say that state support is essential to secure commercial bank loans for the worst affected sectors.

The recent maturity of a large Nokkie line released NOK9bn ($904.5m) into the market last week, with some foreign investors eager to reinvest in attractive short end paper.

With the demand for green loans from its members increasing, Kommuninvest printed its tenth green transaction this week, raising Skr5bn ($520m). Despite the increased demand for green loans, Kommuninvest is yet to proceed with its euro green debut.

Swedish airline SAS has signed a Sk3.3bn ($336m) revolving credit facility backed by the Swedish and Danish states, as state support for airlines gets approval across Europe.

Crédit Mutuel Arkéa paid a 'generous' 7bp of new issue premium for a preferred senior bond on Tuesday, taking advantage of a quiet market to attract attention from investors.

Spreads in the financial institutions bond market have sprung back to more ‘normal’ levels lately, but issuers may have to wait a little while longer before capitalising on the improvement in conditions, given that many of them are side-lined by earnings blackouts.

Swedbank was paying less than fair value for a new euro senior deal on Friday, according to market participants, with the bank raising funding a day after publishing its first quarter results.

Svenska Handelsbanken and Swedbank looked to be as transparent as possible when laying out their assumptions for loan losses this week, as part of an effort to reassure the market about their resilience in the face of the coronavirus crisis.

Svenska Handelsbanken was the only financial institution to issue senior debt in euros this week. The issuance came at a time Swedish banks have been granted an extension of two years to comply with regulatory targets for MREL debt, which might make a short-term dent in issuance.

Financial institutions bond bankers are struggling to build a new pipeline of issuance, despite a significant improvement in market conditions this week. Not only are banks entering blackout periods ahead of first quarter results, many of them are also happy to wait before seeking to raise new funding.

The European Investment Bank joined the ranks of supranationals issuing debt to support the fight against Covid-19 this week, using its recently updated sustainability awareness bond (SAB) framework to raise Skr3bn ($299m) to finance its response to the coronavirus pandemic.

Despite current market turbulence, Kommuninvest, the funding body for Swedish local governments, still plans to press on with its debut euro green bond when volatility abates, according to its head of debt management.