Tuesday, 25 October 2016

Goldman Sachs sign

Goldman issues longest TLAC floating rate callable

25 October 2016 By

Goldman Sachs sold a US$1bn 11-year non-call 10 bond Tuesday, the longest dated among the floating rate callables issued recently by US banks to decrease costs of complying with new loss-absorbing debt requirements.

Lendmark Financial selling old-school subprime ABS

25 October 2016 By

Lendmark Financial Services is in the ABS market with a new subprime consumer loan bond that it is looking to sell more cheaply than similar offerings from its online lending rivals.

Wind Hellas logo

Wind Hellas to test appetite for racier high-yield deals

25 October 2016 By Robert Smith

Greece’s Wind Hellas has launched its first public debt offering since it badly burnt bondholders in a 2010 restructuring, as the telecoms company looks to win over a cautious market that saw two high-yield deals pulled this month.

Danone yoghurt

Danone whips up market frenzy with jumbo M&A bond

25 October 2016 By

Danone stormed the market on Tuesday with what is set to be the largest M&A bond from a European company since the European Central Bank began its corporate bond buying programme in June.

Banca Monte dei Paschi Siena

Monte Paschi debt rallies on liability management proposal

25 October 2016 By

Banca Monte dei Paschi di Siena is lining up a voluntary tender for some of its debt as part of its new business plan unveiled on Tuesday morning, spurring a strong rally in certain securities.

Cajamar debuts with tricky Tier 2, BFCM returns

25 October 2016 By

Banco de Credito Social Cooperativo (Cajamar) is making its first sally into the public bond market, testing investor appetite for sub-benchmark, high-yielding peripheral debt.

A JR Kyushu operated train

EQUITIES: JR Kyushu shares surge on debut

25 October 2016

Japanese railway operator JR Kyushu surged by 20% on its Tokyo Stock Exchange debut today to as high as ¥3,120 per share in early trading.

Danone's US dollar M&A bond expected Wednesday

25 October 2016Updated: 25 October 2016 By Hillary Flynn

Danone is expected to launch a US dollar bond on Wednesday as part of its debt raising to finance the US$13bn purchase of WhiteWave Foods, two market sources told IFR.

Wall Street sign

Regulators taking another look at costs of Wall St safety rule

24 October 2016

(Reuters) - Just as memories of the financial crisis are fading and tough new banking regulations are beginning to bite, some current and former regulators wonder whether one of the rules is too much of a burden for markets and taxpayers.

Genworth Financial logo

Genworth bonds jump on acquisition by China Oceanwide

24 October 2016 By

Genworth Financial’s bonds jumped as much as 30% in secondary trade Monday on news that the US insurer would be acquired by China Oceanwide Holdings.

PDVSA logo

UPDATE – Venezuela PDVSA swaps US$2.8bn 2017 bonds, gains financial breather

24 October 2016

(Reuters) - Venezuelan state oil company PDVSA said on Monday a debt swap allowed it to push back some US$2.798bn in payments originally due next year to 2020, giving the cash-strapped company a financial breather.

Codere logo

Peripheral gaming and French M&A dominate high-yield primary

24 October 2016 By Robert Smith

European high-yield continues to see deal after deal, as gaming companies Codere and Snai market refinancing trades, while France’s DomusVi and BUT look to bring acquisition bonds.

The AT&T logo is pictured by its store in Carlsbad, California

AT&T, Time Warner bonds widen on merger news

24 October 2016 By Michael Gambale, Hillary Flynn

AT&T saw some of its shorter-term outstanding bonds widen sharply in secondary trade Monday after the telecoms giant announced a blockbuster US$85bn acquisition of Time Warner.

Buyside swap market participants raises concerns

DERIVATIVES-Compression extends to client-cleared swaps

24 October 2016 By

Swaps compression cycles intended to tear up superfluous contracts have been extended to client-cleared buyside trades for the first time, enabling end-users that are not direct members of a clearinghouse to collapse redundant exposures.

Morgan Stanley logo

Callable senior market revs up in Europe with Morgan Stanley FRN

24 October 2016 By

Morgan Stanley is selling a euro floating-rate note with a call option one year before maturity just days after Goldman Sachs sold the first bond of this kind in the single currency.

Rentenbank logo

Rentenbank kicks off week of dwindling SSA supply

24 October 2016 By

Rentenbank became the first issuer of the week to hit screens, with a 20-year euro-denominated trade at the start of what promises to be a last hurrah for the year.

All Latest news

King Abdullah Financial District in Riyadh

Big and beautiful

IFR 2156 22 October to 28 October 2016

Hats off to Saudi Arabia. Many observers (including IFR) were advising the sovereign to be conservative on size with its international bond market debut.

Top News

Saudi prices record-breaking deal

Saudi creates bond market history

IFR 2156 22 October to 28 October 2016 By

Saudi Arabia re-wrote the record books with its debut in the international markets last week as it sold the biggest emerging markets bond deal in history, establishing a new benchmark for the Middle East in the process.

Lukoil gas station

Lukoil revives deal as demand grows for Russia

IFR 2156 22 October to 28 October 2016 By

Lukoil looks set to become the latest issuer to tap into growing demand for Russian paper, with the oil giant close to pulling the trigger on a deal that has been delayed for the past two years.

Henry Kravis

KKR reaps reward from going it alone

IFR 2156 22 October to 28 October 2016 By

When private equity firm KKR set its sights on a small Midwestern retailer in late 2015, it turned to some of the largest banks on Wall Street to obtain debt financing for the acquisition. It found no takers.

A Sprint store in New York

Sprint widens reach for spectrum bonds

IFR 2156 22 October to 28 October 2016 By

Investors from all corners of the capital markets piled into Sprint’s US$3.5bn of spectrum-backed bonds last week, giving the loss-making telecoms carrier a much-needed liquidity boost.

Financial Conduct Authority (FCA) logo

FCA targets league tables for reform

IFR 2156 22 October to 28 October 2016 By Alex Chambers,

League table manipulation is one of the greatest issues facing investment banking, according to the UK market regulator. The Financial Conduct Authority’s report into investment banking seemed to declare the issue more important than the apparent corruption in IPO allocations it discovered through extensive analysis, or reciprocity between banks, which it said exists but does not stifle competition.

British pounds and Euro banknotes

Sterling bonds struggle as Brexit blues bite

IFR 2156 22 October to 28 October 2016 By Robert Smith,

Investors’ tolerance for riskier sterling deals is waning fast in the primary bond market, as telecoms services outfit Daisy pulled a high-yield corporate bond and insurer JRP Group had to offer a punchy 9% yield to get a capital trade over the line.

Citic logo

Japan warms to China risk

IFR 2156 22 October to 28 October 2016 By Frances Yoon

Citic Group’s ¥100bn (US$964m) Samurai bond issue smashed records for a Chinese issuer in the Japanese market. It could have been even larger.

Banca Monte dei Paschi Siena

Bond investors stall BMPS capital raising

IFR 2156 22 October to 28 October 2016 By Alex Chambers

Banca Monte dei Paschi di Siena subordinated bond investors are resisting recapitalisation proposals that could see their holdings swapped into equity in the troubled bank.

Zhongtong (ZTO) Express sorting centre

ZTO Express to deliver on US IPO

IFR 2156 22 October to 28 October 2016 By

ZTO Express may beat its US$1.3bn target from the biggest US listing from China in two years after generating a strong response early in bookbuilding.

US dollar and euro banknotes

Cut-price euros on leveraged finance

IFR 2156 22 October to 28 October 2016 By

Cross-border leveraged loans that comprise euro-denominated facilities and US dollar-denominated facilities are seeing the euro tranches priced cheaper than the dollar pieces, as borrowers take advantage of the abundant liquidity on offer in the European market.

IFR Magazine Top News in Full (subscription required)

People & Markets

Bank of America Merrill Lynch logo

FICC rebound saves quarter for US banks

IFR 2156 22 October to 28 October 2016

Fixed-income trading powered US bank results in the third quarter to take up the slack where revenues from capital markets and merger advisory slipped.

Goldman Sachs sign

Goldman, BAML surf DCM wave in Q3

IFR 2156 22 October to 28 October 2016

Investment banking division revenue at the top five US banks was up in the third quarter as revenue from debt and equity underwriting perked up, neutralising the downturn in merger and acquisition deal flow in the quarter.

JP Morgan & Chase Co. building in New York

JP Morgan set to look for new China JV

IFR 2156 22 October to 28 October 2016

JP Morgan’s move to exit its Chinese securities joint venture has again shone the spotlight on the hurdles facing global banks in the mainland capital markets.

Mark Schwartz

Goldman Asia chairman Schwartz to leave

IFR 2156 22 October to 28 October 2016

Mark Schwartz is stepping down as Goldman Sachs’ Asia-Pacific chairman at the end of the year, triggering a search for a replacement at a time when the US bank is scaling back its resources in the region.

Donald Trump and Hillary Clinton

Fear of Trump win replaced by worry of Democrat sweep

IFR 2156 22 October to 28 October 2016

Anxiety over a Donald Trump victory in the race to become the next president of the United States is being replaced by a new concern that the Democrats could win the White House, Senate and House of Representatives and come down hard on Wall Street.

    More from People & Markets


    Yields on corporate hybrids issues in 2016

    No trip around town for Aroundtown's hybrid debut

    IFR 2156 22 October to 28 October 2016

    Aroundtown Property’s debut hybrid struggled over the line last week, as the firm adopted a gung-ho approach to marketing despite the credit being relatively niche and the hybrid sector still challenged.

    UK faces big test with Gilt syndication

    IFR 2156 22 October to 28 October 2016

    Tensions will run high this week for the UK DMO’s first Gilt syndication since chaos in the currency market and concerns over a potential hard Brexit catapulted yields higher.

    Goldman Sachs sign

    TLAC callables all the rage

    IFR 2156 22 October to 28 October 2016

    US banks unleashed a torrent of callable senior debt in US dollars and euros this week, finding strong investor demand for the structure, which is designed to cut the cost of new regulations.

    Danone and Verizon to restart euro M&A market

    IFR 2156 22 October to 28 October 2016

    Danone and Verizon Communications are set to reboot the European M&A debt market with jumbo multi-currency bonds this week after a recent hiatus in the sector, following Anheuser-Busch InBev and Air Liquide’s blockbuster trades in the first half of the year.

    Wind Hellas sounds out bond investors

    IFR 2156 22 October to 28 October 2016

    Greece’s Wind Hellas has met high-yield bond investors to gauge their appetite ahead of a potential return to the debt market, according to people with knowledge of the matter.

      More from Bonds


      ChemChina headquarters

      Chinese giants in merger talks

      IFR 2156 22 October to 28 October 2016 By Umesh Desai, Carol Zhong

      A possible merger with fellow Chinese state-owned group Sinochem could bring welcome relief to debt-laden chemicals giant ChemChina as it looks to wrap up the US$43.5bn acquisition of Switzerland-based seeds company Syngenta.

      ONGC logo

      ONGC Videsh seals bigger bridge

      IFR 2156 22 October to 28 October 2016 By Chien Mi Wong

      ONGC Videsh has sealed a US$875m six-month bridge to fund its purchase of an additional stake in a Russian oilfield. 

      Fitch Ratings headquarters in New York

      European loan funds growing strongly, says Fitch

      IFR 2156 22 October to 28 October 2016 By Tessa Walsh

      Europe-domiciled loan funds had €40bn of assets under management at the end of June 2016, and have grown 50%–60% in the past five years as the European investor base continues to transition from banks to funds, according to a report by Fitch Ratings.

      Euro Garages logo

      Euro Garages wins lender consent despite pushback

      IFR 2156 22 October to 28 October 2016 By , Hannah Brenton

      UK petrol station forecourt operator Euro Garages has won consent to raise an €876m-equivalent loan backing its merger with European Forecourt Retail despite pushback from existing lenders.

      Chesapeake Energy natural gas well pad

      Chesapeake loan surges as investors call for refi protection

      IFR 2156 22 October to 28 October 2016 By , Lynn Adler

      Natural gas producer Chesapeake Energy’s US$1.5bn leveraged loan has hit stratospheric heights in the secondary market normally reserved for high-yield bonds, boosted by a combination of stiff investor protections and rebounding commodity prices.

      Mondelez logo

      Mondelez wraps US$6bn in loans

      IFR 2156 22 October to 28 October 2016

      Confectionery, food and drinks company Mondelez has completed US$6bn in loans comprising a US$4.5bn senior unsecured revolver for Mondelez International and up to US$1.5bn in term loans for subsidiary Mondelez International Holdings Netherlands.

      P&G markets US$8bn refinancing

      IFR 2156 22 October to 28 October 2016

      Household products maker Procter & Gamble is in the market with an US$8bn refinancing via Citigroup and JP Morgan.

      Bayer logo

      Germany: Bayer details US$56.9bn bridge

      IFR 2156 22 October to 28 October 2016

      Allocations have emerged on drug and crop chemicals group Bayer’s US$56.9bn bridge loan backing its agreed US$66bn takeover of US seeds company Monsanto.

      More from Loans


      PNB Housing Finance logo

      PNB Housing tests tricky IPO waters

      IFR 2156 22 October to 28 October 2016

      PNB Housing Finance is set to price India’s second-largest IPO this year at a “reasonable” level after two bungled high-profile equity raisings from the financial sector.

      Charter Hall Group logo

      Long WALE REIT to sweeten offer

      IFR 2156 22 October to 28 October 2016

      Charter Hall Group is preparing for a second bite of the cherry after the surprise withdrawal of its A$1.12bn (US$858m) Charter Hall Long WALE REIT IPO last week.

      Crispr Therapeutics logo

      From gene editing to IPO editing

      IFR 2156 22 October to 28 October 2016

      Underwriters were forced to re-engineer gene editing company Crispr Therapeutics’ IPO last week, and not in the positive sense one might associate with the company’s potentially ground-breaking technology.

      Forterra logo

      Forterra drains investors with US$331.6m IPO

      IFR 2156 22 October to 28 October 2016

      The water contamination crisis in Flint, Michigan exposed chronic problems with America’s aging infrastructure.

      Moly-Cop works on ASX IPO

      IFR 2156 22 October to 28 October 2016

      Moly-Cop is tentatively planning to file a prospectus for a potential US$1bn ASX IPO on November 2, according to a person close to the deal.

      CR Pharma raises US$1.8bn

      IFR 2156 22 October to 28 October 2016

      China Resources Pharmaceutical Group has raised HK$14bn (US$1.8bn) from its Hong Kong IPO, pricing the shares slightly below the midpoint of the indicative range.

      Two companies to sell rights

      IFR 2156 22 October to 28 October 2016

      Sealand Securities has applied for approval to the China Securities Regulatory Commission for a proposed issue of up to 1.26bn rights shares on a 3-for-10 basis to raise Rmb5bn (US$739.3m).

      Barbeque Nation hiring for IPO

      IFR 2156 22 October to 28 October 2016

      Sayaji Hotels-owned casual dining chain Barbeque Nation Hospitality is hiring banks for an IPO of Rs5bn-Rs10bn (US$75m-$150m).

      More from Equities


      P&M: HKEx introduces volatility controls for derivatives market

      25 October 2016

      (Reuters) Hong Kong Exchanges and Clearing said on Monday it plans to extend new volatility controls to its derivatives market on November 14.

      R3 logo

      R3 plans November launch for open source blockchain

      24 October 2016 By

      R3, the consortium developing blockchain for the financial industry, will make its technology open source by the end of November, in a move it hopes will help create an industry standard.

      Buyside swap market participants raises concerns

      DERIVATIVES-Compression extends to client-cleared swaps

      24 October 2016 By

      Swaps compression cycles intended to tear up superfluous contracts have been extended to client-cleared buyside trades for the first time, enabling end-users that are not direct members of a clearinghouse to collapse redundant exposures.

      Buyside resists push for standardised collateral

      IFR 2156 22 October to 28 October 2016 By

      Buyside derivatives users are pushing back against banks seeking to impose standardised collateral agreements, ahead of rules requiring variation margin on uncleared swaps set to come into force in March.

      Cost of clearing hurts small firms, says ISDA

      IFR 2156 22 October to 28 October 2016 By

      Smaller derivatives users are finding it increasingly difficult to get access to clearing as banks raise prices and set thresholds that some counterparties cannot reach.

      More from IFR Derivatives

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      Special Reports

      Rmb Bond Market Roundtable
      China is going global, and so is its currency. The renminbi officially entered the International Monetary Fund’s basket of global reserve currencies on October 1, and barely a week goes by without talk of major reforms to open some aspect of the country’s capital markets to the world.

      IMF/World Bank
      With 189 member states encompassing virtually the entire globe, the IMF is uniquely positioned to monitor the health of the economic environment throughout the world. Each region presents its own set of circumstances – some positive, some negative – and the ingenuity of the capital markets to navigate a way through this varied landscape should never be underestimated.

      Asian Debt Capital Markets
      There is a clear driver behind the deals in Asia’s primary markets today, and that is the search for yield. From perpetual bonds in Singapore to subordinated Samurais in Japan and high-yield sovereign debt in Sri Lanka, investors are jumping at the chance to boost returns.

      Asian Bank Capital Roundtable
      Bank capital has long been a hot topic in Asia, but the asset class has so far failed to ignite the kind of excitement that the Basel reforms once promised – at least outside of Australia. That is all about to change.

      From the practice of placing a bell around the neck of a castrated ram to lead the flock


      IFR 2156 22 October to 28 October 2016

      “IF THERE’S SOME secret international cabal, I’ve been left out of the party again,” said Goldman Sachs boss Lloyd Blankfein in response to the claim by US presidential candidate Donald Trump that “Hillary Clinton meets in secret with international banks to plot the destruction of US sovereignty in order to enrich these global financial powers, her special interest friends and her donors”.


      James Saft - June 2014

      With election out of way, real fretting can begin

      Not since the trial of O.J. Simpson has America had a news story that transfixed people more and affected financial markets less.

      Anthony Peters columnist format

      Light at the end of the tunnel?

      I’m not quite sure where the inflection point was or when it emerged but markets seem a very different place now than they were just a few weeks ago. 

      Anthony Peters columnist format

      Deals galore!

      Whether the stunning US$17.5bn three-tranche deal for the Kingdom of Saudi Arabia tells us more about the state of affairs in the Kingdom or about the desperation of investors for yield and diversification might be a moot point but I take my hat off to the borrower and the lead group for putting together a brilliant deal at the right price. 

      Keith Mullin 475px June 2014

      FICC rides to the rescue

      FIXED-INCOME TRADING, the bête noire of investment banking for so long, bailed out what might have been an otherwise so-so third-quarter performance for the Big Five US firms as clients regained some sangfroid and showed more willingness to trade. Now, how often have you heard that?

      James Saft - June 2014

      When “dark markets” are unfair to mutual fund investors

      Funds conducting off-exchange trades within their own fund family are likely favouring their “stars” at the expense of the also rans.

      Anthony Peters columnist format

      Is China changing gear?

      China’s third-quarter GDP figure released this morning was highly encouraging at 6.7% year-on-year and 1.8% quarter-on-quarter, and the 6.1% reading for industrial production and 10.7% growth in retail sales were also pretty impressive. How nice is that? 

      Top 250 2016

      Top 250 Borrowers 2016

      Strength and depth: Few would claim that conditions in the capital markets could currently be described as normal. Nor that they have they been so for a while now, given the various stimulus programmes that have been enacted around the world in an effort encourage growth in the face of economies flirting with stagnation.

      IFR Financing Sustainable Infrastructure Report 2016

      IFR Financing Sustainable Infrastructure Report 2016

      Sustainable infrastructure agenda moves centre-stage

      IFR Turkey Special Report 2016

      Turkey 2016

      Star turn: In the fluid world of emerging markets, Turkey has this year presented more opportunities than its CEEMEA peers for investors to indulge their views.

      All Latest Special Reports