Stock Groups

European corporates return to debt market after Ukraine shock -Breaking


By Yoruk Bahceli

(Reuters) – European companies returned to Europe’s corporate bond market on Thursday to issue debt after the market was frozen for a week due to Russia’s invasion in Ukraine.

American medical equipment company Boston Scientific (NYSE 🙂 American has launched six, nine, and twelve-year bonds totaling 3 billion euro to purchase back U.S. dollars bonds. Bazalgette Finance was a special purpose financing entity that supports the Thames Tideway Tunnel. According to Refinitiv’s information, it launched a 12-year, 300-million-pound green bond. They were both the first trades on the market since Wednesday.

Marco Stoeckle (DE: Head of Corporate Credit Research at Commerzbank) noted that first issuers were from more secure sectors than would have been expected following the effective freezing of the market.

It’s difficult to determine if this is the start of a long-term trend. (Issuance) can disappear in a matter of minutes, if there aren’t the right headlines.

Reverse Yankees are U.S.-based companies such as Boston Scientific that issue bonds in European markets. They offer higher yields because they do not qualify for European Central Bank bonds purchases. Green bonds attract more demand from ESG-focused investors who want to own a small number of assets.

European corporate bonds of investment grade were up 50 basis points in February. The market outperformed the U.S. and suffered its largest monthly loss since March 2020 according to BofA Indexes. Due to the ECB’s hawkish turn followed by an invasion of yields in February, European investment-grade corporate bond yields increased 50 basis points. This year, they have more than doubled their value.


According to IFR., the reopening this week pales in comparison to approximately $30 billion of investment-grade American companies raised on Tuesday or Wednesday.

European issuance has already been slowing since the invasion. This is not expected to change based on current market conditions.

Senior banker for European companies who organizes debt sales said that issuers continue to struggle to deal with rising borrowing costs.

The banker spoke under the condition that anonymity was maintained. He stated, “Some issuers want to go. Some are struggling to understand it. And the pipeline will change.”

Reuters received information from bankers that several companies delayed plans to sell debt until May or later. Others have stopped selling because market conditions are no longer favorable for opportunistic deals. The bankers suggested that some companies may have looked for alternative financing such as private debt.

Another corporate banker stated that “most of our issuers have strong cash balances and are very liquid so they don’t need to rush into markets or make large concessions.”

Many analysts expected more corporate bond offerings this year, both to finance mergers and acquisitions. Given the current uncertainty, some bankers believe that there may be a decrease in issuance.

According to the banker, “Finance will be available if necessary but it is more difficult for opportunistic components of it right now.”

Disclaimer: Fusion MediaThis website does not provide accurate and current data. CFDs include stocks, indexes and futures. Prices are provided not by the exchanges. Market makers provide them. Therefore, prices can be inaccurate and differ from actual market prices. These prices should not be used for trading. Fusion Media does not accept any liability for trade losses that you may incur due to the use of these data.

Fusion MediaFusion Media or any other person involved in the website will not be held responsible for any loss or damage resulting from reliance on this information, including charts, buy/sell signals, and data. Trading the financial markets is one of most risky investment options. Please make sure you are fully aware about the costs and risks involved.