Corporate credit correspondent
Jane's Feed
Jun 23, 2010

Few Europe banks have HSBC’s nerve on hybrids

LONDON (Reuters) – HSBC(HSBA.L: Quote, Profile, Research) has braved the regulatory uncertainty over bank capital with a massive $3.4 billion Tier 1 bond sale in the United States with few other European banks likely to follow its bold move.

Rather than wait for more clarity on new rules, which might raise the cost of selling hybrid bank securities in the future, HSBC has seized an opportunity to tap into U.S. investor demand for higher yielding assets.

Jun 15, 2010

Europe’s wounded ABS market recovers moderately

LONDON, June 15 (Reuters) – Europe’s mortgage-backed
securities market is set to stabilise at a volume of about 100
to 200 billion euros ($134.2-$268.3 billion) a year, a leading
banker said, a fraction of where it was in the past.

This year, the recovery in mortgage-backed securities could
see volumes rise to about 100 billion euros, from around the 30
billion euros done since January this year.

Jun 15, 2010

Wanted: New investors to back Europe’s home loans

LONDON, June 15 (Reuters) – An annual gathering of big names
in the securitisation business is likely to attract more than
3,000 delegates on Tuesday but only a sprinkling of real
investors as central banks are now the key players in this area,
plugging a $1 trillion funding hole created by the credit crisis.

At the conference in London, keynote speakers will include
European Central Bank board member, Jose Manuel Gonzalez-Paramo,
and Patrick Pearson, head of Financial Markets Infrastructure at
the European Commission, illustrating the importance of
securitisation and central banks’ key role.

Jun 2, 2010

Europe sees patchy revival in new bond issues

LONDON, June 2 (Reuters) – A handful of banks and companies
from Europe’s “core” helped reopen Europe’s bond markets this
week after a shut-down of more than a month, but markets remain
closed for southern European firms due to the sovereign crisis.

A covered bond issue from French mutual lender Credit Mutuel
Arkea highlighted the revival in investor appetite.

May 25, 2010

Banks look to governments again to fill funding gap

LONDON, May 25 (Reuters) – Some of Europe’s banks are
candidates for government guaranteed issuance due to limited
access to the bond markets, but sovereign debt worries could
weaken the value of government support, bankers say.

The European corporate bond market has been effectively
closed for banks for more than a month, with issuance slumping
to $2.6 billion in May, down from $82 billion in January,
according to Thomson Reuters data.

May 19, 2010

Prudential eyes hybrids to cut AIA finance costs

LONDON, May 19 (Reuters) – Britain’s Prudential <PRU.L>
could save as much as $150 million on the cost of its planned
acquisition of AIA by refinancing a $5.4 billion chunk of hybrid
securities in the bond markets, where investors have shown an
appetite for insurance sector deals.

A successful subordinated bond sale last month by French
insurer AXA <AXAF.PA> illustrated investors’ receptivity to
subordinated deals from insurers, partly because there have been
few issues this year from insurers or banks, partly due to
regulatory uncertainty.

May 17, 2010

UK bank funding costs create dilemma for new govt

LONDON, May 17 (Reuters) – The Greek crisis looks set to
keep funding costs high for Lloyds <LLOY.L> and Royal Bank of
Scotland <RBS.L>, creating a dilemma for a new government
wanting banks to lend more while funding themselves in the
markets without any hand-holding.

Greece’s debt troubles have infected the wider European
banking sector, pushing credit market spreads sharply wider and
freezing the new issues market for more than a month.

May 11, 2010

Greek crisis exposes credit market’s fragile state

LONDON, May 11 (Reuters) – The panic over Greece’s finances
has exposed the fragile state of liquidity in corporate credit
markets, particularly for bank debt, spurring the European
Central Bank to give itself the option to buy corporate bonds.

The ECB at the weekend unveiled plans to buy government and
private bond sector bonds to ensure “depth and liquidity in
those markets which are dysfunctional.” [ID:nLDE6450VF]

May 6, 2010

Bank risk signal flashes red over Greek crisis

LONDON/FRANKFURT (Reuters) – A key risk indicator for Europe’s banks hit a record high on Thursday as fears mounted over their exposure to Greece and amid signs that Athens’ woes could spread to hurt other economies in the euro zone.

The rise came as BNP Paribas said it had 5 billion euros (4.5 billion pound) of exposure to Greek sovereign debt, the highest shown by France’s top banks.

May 5, 2010

Banks face funding bottleneck after 2-week shutdown

LONDON (Reuters) – Europe’s sovereign crisis looks set to aggravate funding challenges for its banking sector by keeping a lid on new bond issues, lengthening the queue of banks lining up to raise money, bankers said on Wednesday.

The primary market for bank bonds has been effectively closed for two weeks because uncertainty over the Greek debt bailout has created volatility in credit markets, particularly for banks.