The GlobalCapital Podcast: Recent Episodes

GlobalCapital

A weekly podcast from GlobalCapital, the capital markets news service based in London and New York, discussing its most interesting stories from around the world.

Every Friday, listen to lively discussion about the very latest themes, the most innovative and important bond and equity issues and syndicated loans and much more from the capital markets.

This podcast is for anyone working in - or who wants to work in - the capital markets from investment bankers, to funding and treasury officials, investors, lawyers, analysts, NGOs and lobbyists, regulators and policy makers, and analysts.

GlobalCapital has been the "voice of the markets" for over 35 years, covering bond, loan, equity and securitisation markets around the world.

We cover everything from public sector bond issuers, financial institutions, emerging markets and investment grade corporate bonds and loans to securitisation (including CLOs and ABS), regulation and market news as well as industry gossip.

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This podcast is a commute-sized slice of everything that's most interesting from the world's capital markets with the aim of helping you sound smarter in your morning meeting, or making you stand out from the crowd of other hopefuls when kick-starting your career.

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◆ The collapse of another specialist lender hits asset-backed lending but why it's different this time

◆ MDBs ramp up private funding

◆ No greenium but European banks happy to print more ESG labelled debt

Barely six months after the controversial collapse of Market Financial Solutions, another UK specialist lender has tumbled. The failure of Amplifi is another blow to the banks and other institutions that fund the specialist lenders through asset-backed finance.

But the devil, or perhaps in this case the angel, is in the detail. For the two situations have stark differences. We explain why the ABF industry is taking Amplifi's collapse in its stride.

Meanwhile, some of the world's most prominent multilateral development bank bond issuers have increased the portion of their funding done through private placements rather than through their core public benchmark bond programmes. We examine what is driving the change.

Finally, European banks are issuing more and more ESG-labelled debt. This has often been a way for issuers to save on funding costs by targeting a product with a captive investor base. However, there is little of this so-called greenium to be had. So what is behind the volumes? We reveal all.

Now read on:

Amplifi collapse unlikely to cause major disruption to ABF market
MDB funding mix changes as callable bond bid from Asia blossoms
European banks ramp up green bond sales, unfazed by lack of greenium

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◆ Oil trumps politics ◆ Kuwait scores late winner ◆ How to save Thames Water harmlessly

The three month euro/dollar basis swap was traditionally called the bully of the curve because it controlled the rest, but there is no doubt who’s the boss now — dirty old oil.

As the US and Iran traded blows, Houthi threats to close the Gulf of Aden made oil traders freak out this week. Their alarm seized bond markets globally, pushing French and German yields to decade highs and Treasuries to an 18 month peak.

Gilt investors should have had a week of interesting navel-gazing, wondering whether new chancellor of the exchequer John Healey is going to be their next hero or villain. Instead they were rudely shaken out of it by global events, as Gilts turned out not to be special — all govvies were selling off.

A measure of stability has returned, but it’s looking like an edgy summer.

Kuwait likely had that in mind when it brought a $6bn three tranche bond this week, in the last minute of extra time of the bond market’s pre-summer season.

It was the first public bond issue by any of the highly rated Middle Eastern governments since the war began. Investors lapped it up, delighting bankers, who hope it will encourage other issuers.

Back in the UK, Andy Burnham isn’t probably expecting a honeymoon as prime minister — he didn’t win an election. But his peace will soon be disturbed by having to make a big call on Thames Water.

The UK’s largest water company, serving about a fifth of the population, is running out of money. Creditors have put a recapitalisation offer on the table, but nationalisation might be cleaner and safer.

How it’s handled matters keenly to the UK’s dozen other water companies. A good outcome for Thames bondholders could reduce the perceived risk premium they have to pay, but a messy one could be slippery for their cost of capital.

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◆ Greenium reappears in unlikely place ◆ US banks splash out ◆ Is that all I’m worth? ◆ Cantor is coming

A basis point might always be the same quantity, but is it a lot or a little? It depends whom you ask, and when. For supranational, sovereign and agency bond issuers in the dollar market, 1.7bp over Treasuries and 1.9bp over are two different things.

Records keep falling as SSAs price ever closer to Treasuries. Last week the International Finance Corp got to 1.7bp — and it was clearly because its $2bn green bond attracted green-mandated investors, more willing to tolerate spread norms being shaved. Could the first new issue to go through Treasuries be a green bond?

Across town, the big US banks, led by Goldman Sachs, have been pumping out huge bonds after their quarterly results. The usual big dollar issues have been replaced with bigger ones — and dropping whoppers in the euro market is also common now.

The banks are anything but miserly with new issue premiums, seemingly happy to pay 10bp-15bp — in fact their largesse makes life awkward for other issuers. But they’ve got their eyes on bigger prizes.

In Europe’s CLO market, investors are ever so stingy. Managers active for decades, with dozens of deals behind them, can woo bondholders and present their credentials till they’re blue in the face. Will investors give them credit for their experience with tighter pricing? A penny or two if they’re lucky.

Cantor, the New York broker-dealer led for over 30 years by Howard Lutnick till he took Trump’s shilling as commerce secretary, is not nickel and diming. The firm is moving into European investment banking, starting with equity capital markets, M&A and trading.

That takes wedge, and Cantor is dishing out plenty, hiring teams in Hamburg, Milan, Dubai and soon Stockholm. It’s a big if, but if the bet pays off, the returns will not be measured in basis points.

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◆ Clean-up calls set to change how banks manage senior debt

◆ The Bank of England's SSA bond booster

◆ What is behind booming corporate bond issuance in sterling

A lot of expensive bank bonds, issued when rates and inflation were high and spreads wide, have call dates coming up, meaning issuers will be keen to replace them with cheaper debt at current market prices. To do so, they may completely change how they deal with investors when they do buy-backs.

Many of these bonds contain what is known as a clean-up call, which allows the issuer to redeem the rest of the bonds at par once it has competed a tender offer for them, but usually only if it has managed to buy back more than a threshold amount.

This puts investors into a dilemma because the price they will be offered in the tender will most likely be better than where they can sell the bonds in the secondary market and what they will get if their bonds are taken back in the clean-up call.

It's a technique more commonly used in US markets, and for sub-benchmark sized or subordinated European bank bonds. But now the stakes are being raised as the market contemplates its use in replacing expensive, benchmark-sized senior bonds from issuers that rely on wholesale bond funding. We explore what is at stake for issuers and investors alike.

Meanwhile, the Bank of England has started to accept a wider range of public sector bonds as collateral. This will boost the bank treasury bid for sterling SSA bonds. We discuss which new issuers it might attract to the market.

Finally, corporate sterling bond issuance has been on a tear this year. We look at who has been issuing, who hasn't, and what the pipeline looks like for the rest of the year.

Now read on:

Senior bond buy-backs herald new era for European FIG market
Sterling SSA issuers rush the queue as BoE repo change beckons new names
IG corporate bond market eyes rebound in sterling issuance

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◆ How UK's likely next PM can woo the bond market

◆ Fibre ABS coming to Europe

◆ The rise of the corporate Kangaroo

Andy Burnham looks set to become the next UK prime minister, following the resignation of Keir Starmer on Monday. But how will the new man in 10 Downing Street get along with the bond market? One of his predecessors, Liz Truss, managed fixed income relations so badly, it cost her her job and made her term the shortest in the history of the office.

The early signs were not promising. Burnham notoriously said the country should not be "in hock" to the bond market. Perhaps a strange choice of phrase when talking about debt instruments and he has since appeared to row back from the comments, which were intepreted as a fearlessness over borrowing and spending.

So how can Burnham manage the business of government while not blowing up the Gilt market? We have some suggestions.

Meanwhile, the need for digital infrastructure growth in Europe is acute. The capital markets will be vital in funding it and now it looks like a new asset class is on the way — asset-backed securities secured on fibre optic cable networks. We investigate.

We also discuss the rise and rise of the Australian dollar bond market and how global corporations are turning to it increasingly as a source of capital.

Now read on:

Burnham needs a cause — two would please the bond market
First European fibre securitization could arrive within 18 months
Offshore corporate borrowers leap into Aussie dollar mart

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◆ Iran peace deal in sight but where are the Middle East issuers?

◆ Why primary capital markets will be slow adopters of DLT

◆ Why French covered bond issuance has slowed and why it might pick up

The Iran war has kept the Middle East's bond issuers largely at bay but with the path to peace now clearer, issuance conditions have improved. But even this might not be enough to tempt borrowers back to the primary bond market en masse. We discover why.

We also analyse a new report on the digitalisation of wholesale finance and discuss why capital markets might be one of the last bits of finance to go digital.

French issuers are among the biggest users of the covered bond market but so far this year, they are way down on the volumes they have issued compared to last year. We examine what has been going on and uncover the reasons why there could be more French deals in the coming months.

And we also talk about the GlobalCapital Bond Awards 2026 held this week in London, one of our biggest events of the year, and about some of the awards we handed out on the night.

Now read on:Gulf markets lap up peace memo but public issuance unlikely to come roaring back
Primary capital markets could be among last to adopt DLT, report finds
Core covered issuers to step forward in second half of year
GlobalCapital Bond Awards 2026: winners revealed

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◆ What now for European Secured Notes ater long-awaited debut?

◆ The mood in European securitization amid MFS fallout and reg reform

◆ Digitalisation of bond market is up to the regulators

Bpifrance achieved a world first this week, pricing the inaugural European Secured Note. The deal was a success but it has taken about a decade to get the product from concept to market.

The question is now where next for ESNs? This twist on a covered bond has clear applications as a capital market instrument that can help fund the real economy but it could be argued that its future lies in the hands of the regulators and how they choose to treat it. We discuss the different paths ESNs might be led down and the alternatives open to issuers.

Meanwhile, GlobalCapital's European securitization team is back from Global ABS in Barcelona — that market's major gathering for the year. We find out what is giving the market cause for fear and cheer.

We discuss how specialist lenders, banks and funds are adjusting to prevent or mitigate another scandal like the one that befell Market Financial Solutions earlier this year, and how the securitization market feels about the direction of regulatory reform.

Sticking with the topic of all-powerful financial regulators, we also discuss why it is they rather than the technologists that will decide the fate of bond market digitialisation.

Now read on:

ESNs arrive: regulatory recognition may follow French first
European Secured Notes needn’t rush to Brussels
Funds eye ABF market share as banks pull back
ABS conference delegates emit mixed feelings of trepidation and optimism
On DLT, regulators could bring order — or disruption

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◆ Credit card ABS grows as securitization sets off for Barcelona

◆ What can scupper insurance tier two spree

◆ SSAs appear unwilling to test Treasury spread record

A deal from Vanquis Bank, a securitization of credit card receivables, is the latest deal in a revival of an asset class that has been morinund since the 2008 financial crisis. We examine why this market is making a comeback now and what makes it different this time.

We also discuss our sister podcast, Another Fine Mezz's plans for a live show at next week's Global ABS event in Barcelona, which is the major industry gathering for the European securitization industry, and look ahead to the conference.

Insurance companies have been on a spree of tier two issuance lately. We explain why and discuss why investors might be reaching their limit and what issuers can do about it.

Finally, we return to a hot topic from last week's show — whether a public sector bond issuer can price a deal at a tighter yield than US Treasuries. It appears that there is some reticence among issuers to be the first, even though doing so would be a major milestone. We examine why that is and explain why it might still happen over the summer anyway.

Now read on:

Vanquis fuels bank-led credit card ABS comeback
Insurer tier two parade begins to test investors' limits
On the banks of the Rubicon: hopes for an SSA to price through Treasuries fade
Pricing an SSA through Treasuries would be a warning not a trophy

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◆ Venezuela embarks on historic debt restructuring
◆ Canada suggests covered bond boost
◆ European Secured Notes are here. Regulate them

Venezuela's debt restructuring is getting underway, nine years after the country defaulted and just months after the US removed its former president, Nicolas Maduro. The amount of debt involved is expected to be huge but no one outside of Venezuela knows quite how much.

That's not the only unusual thing about the exercise. We discuss what looks likely to be the biggest sovereign debt restructuring since Greece — the unknowns, the unique complexities, where there is hope for Venezuela and its creditors and the rare involvement of the US government.

Canada is considering easing up on the regulatory treatment of overseas covered bonds. We explore what this means for Canada's banks, international covered bond issuers and whether it advances the cause for the regulatory equivalence between different financial jurisdictions that could unlock growth for the asset class.

Finally, the European Secured Note, a long-touted idea to use covered bond techniques to fund lending to different sorts of assets is about to make an appearance in the bond market. We discuss Bpifrance's pioneering deal, which will boast loans made to small and medium-sized companies as well as mid-cap French firms as collateral, and argue that regulators need to decide how to treat ESNs if they are to have a future as a funding tool for the EU economy.

Now read on:

Long road ahead as Venezuela preps jumbo debt restructuring

Canadian reform may help level global covered bond playing field

First ESN arrives at last — regulators should bless it

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◆ Supranationals and agencies prepare to achieve the previously unthinkable

◆ Leveraged loans versus private credit and their effect on CLOs

◆ A new dawn for dollar covered bonds and UK equity market structure

Bond issuance from supranational and agency issuers is rampant. And not only are volumes high but the bonds are flying too, attracting large order books, being priced with little if any issue premium and then performing in the secondary market.

There has been a notable resurgence in dollar issuance in particular, even as issuers price within a hair's breadth of US Treasury yields. That has set the market alight with chatter once more that an issuer could be about to price a bond through what is commonly held to be the most risk-free asset on the planet. We explain the dynamics at work and identify what deal from which issuer could achieve this milestone.

At the lower end of the credit spectrum, borrowers are making choices between going to the private credit market for funding or the broadly syndicated leveraged loan market. We discuss the choices borrowers face and the implications for the collateralised loan obligation market.

The dollar market hosted a rarity this week: a covered bond from a European bank. As investors look for alternative highly-rated securities in the currency to Treasuries, we investigate whether we will see much more covered bond issuance and what might drive or prevent it.

Finally, we looked into what trade bodies are demanding of the Financial Conduct Authority from its consultation on the structure of UK equity markets. We examine their arguments for a consolidated tape and where trading should be encouraged to take place.

Now read on:

SSAs glow in sunshine of demand, pushing spreads ever closer to Treasuries

Credit quality diverges, with CLOs getting better names, private credit the rest

Bawag’s first dollar covered bond shines light on niche market

Trade bodies to FCA: leave trading alone but give us a great equities tape

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◆ The prospects for sterling bond issuance amid UK political upheaval

◆ A new issuer and a new securitization from the SSA sector

◆ Ontario's plans for a resilience bond

The mice turned on the cat in UK politics this week, causing volatility in the bond market and a headache for issuers of sterling bonds. Prime minister Keir Starmer is under fire from Labour Party colleagues and faces a challenge to his leadership following a grim set of local election results.

Uncertainty over whether there will be a change of PM and what the fiscal policies of a new one will be is roiling the Gilt market. But what of other issuers in sterling? We discover there is plenty of demand for bonds at these higher yields, but whether issuers have any interest in funding at those prices is another matter.

The multilateral development bank bond market is about to welcome a new entrant: the African Development Fund. We discuss what the ADF is, how much it will issue, when it will start and why it is coming to the bond market.

Elsewhere in the MDB sector, the International Finance Corporation has executed a novel securitization long in the works. We analyse the deal, who bought it and what the future will be for this method by which MDBs can manage their balance sheets.

Finally, Ontario this week made its pitch to host another new multilateral bank: the Defence, Security and Resilience Bank. To display the province's credentials, its premier Doug Ford revealed it would issue a "resilience" bond. Resilience is becoming a huge topic in the capital markets but the deal would be the first of its kind, so we looked into its progress to market and what it will be used to fund.

Now read on:

Sterling market braces for volatility as Starmer drama erupts

The quiet volatility of a noisy Gilt market

African Development Fund could issue $4bn over three years

IFC’s first synthetic securitization powers up EM trade finance

Ontario targets first 'resilience' bond as it pitches to host DSR Bank

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◆ EU regs plan sparks debate over treatment of secured borrowing

◆ Blistering corporate and FIG issuance but why are premiums rising in one market but not the other?

◆ UK Renters' Rights Act to impact UK buy-to-let RMBS market

Plans to change the capital risk-weightings banks must apply to some of their securitization holidings caused consternation in the covered bond market this week. Both securitization and covered bonds are forms of debt secured on a pool of assets — often of the same type, such as mortgages. Of course there are big differences between the two asset classes as well.

Fresh from the European Covered Bond Council's conference in Norway this week, we delve into the controversy and what the outcome will likely be for the way covered bonds are treated under the rules, as well as securitizations.

Another two markets that are close cousins are the European financial institution and investment grade corporate bond markets. Both have been very busy lately, awash with deals. But while new issue premiums are rising in the corporate bond market, that is not the case in the FIG market. We discuss why that is and what the pipeline looks like in each for the rest of the month.

Finally, we discuss another set of rules affecting securitization. The Renters' Rights Act recently came into force in England. The changes it demands to the way landlords operate will have a knock-on effect on the UK's buy-to-let residential mortgage-backed securities market. We examine what those will be.

Now read on:

Experts play down European snub to covered bonds

Who's afraid of securitization?

Fearless FIG investors gobble up latest wave of heavy issuance

Corporate issuers pay up in euros as bond wave floods market

Fear not the hyperscalers

UK BTL RMBS to persist despite Renters' Rights Act

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◆ Powell Fed era ends with split decision ◆ Bank capital to lead Gulf bond revival ◆ SSAs, corporates and FIG face busy May

President Trump appointed Jay Powell as Federal Reserve chair — then hounded him continually to ease monetary policy and ended up launching a criminal investigation against him. What could possibly go wrong for Kevin Warsh?

The central question for markets is whether he will have an independent mind or be Trump’s puppet. So far, Warsh is getting the benefit of the doubt.

After 62 days without a public bond deal from the Gulf, Emirates NBD reopened the market, surprising observers by bringing a deeply subordinated additional tier one capital deal.

It could be more than a one-off. A lot of banks in the region have capital securities to call and replace, and these are likely to bulk large as issuance gets back into gear.

Across the public sector, financial institution and corporate bond markets, May is set to be exceptionally busy with issuance, but each sector is taking the prospect in a different way.

Corporates are gung-ho, while SSAs are still gripped by the urge to avoid risk by funding as much as possible early. Financial instutions have borrowing to catch up on, but are close to a cliff edge. Spreads are ultra-tight, but nasty spectres could easily spook the market.

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◆ Fast money reverses out of SSA bond market

◆ CLO managers face risky ramp startegy

◆ Corporate hybrid bond market runs hot despite volatility

The rise of hedge funds as dedicated investors in the supranational and agency bond market was one of the biggest changes in that sector at the start of the year. But now they are pulling back from new issue syndications. We examine why market volatility resulting from the Iran war has sounded the retreat and also assess the impact their withdrawal is having on issuers' pricing power.

Meanwhile, the war in Iran is one of a number of factors affecting leveraged loan pricing. It has given CLO managers a chance to make more money, if they can get their hands on enough cheap loans to ramp-up the collateral backing their deals fast enough. But, as we discover, that brings them a whole new set of risks, especially in financial markets which react, as one source put it this week "tweet by tweet".

Finally, we ask why investment grade companies are having such success in the hybrid bond market. Counterintuitively, issuers are achieving debut deals and tight pricing on their riskiest form of debt just at a time when the war is making other markets far less certain. We discuss the dynamics at play.

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◆ Dazzling feats of issuance in public sector bond market but signs of wariness persist

◆ How banks have derisked May issuance

◆ Corporate bond investors stick around

So many bond issuance records tumbled in a busy week in the primary market that to some it felt like we were back in January. That is typically the busiest month of the year and the 2026 edition was particularly successful for issuers. But scratch beneath the surface and it was clear that issuers were having to be quite cautious about how they approached investors.

This week, we discuss the tactics public sector issuers are using that are driving investors into their deals and those they are not deploying, at least just yet.

We also look at how banks have brought forward issuance, pricing some spectacular deals by doing so, to take advantage of improved investor sentiment resulting from the Iran war ceasefire. We debate what this means for the rest of the spring for banks issuing in the primary market.

Finally, we looked at the European corporate bond market where issuers also took full advantage of the sentiment boost, allowing us to examine the way different companies are approaching investors and what makes for a successul new issue.

Now read on:

SSA orderbooks bulge like it's January but sensitivity and ‘insecurity’ remain
SSA issuers that can offer clarity will thrive in uncertainty
Surging demand for euro FIG credit eases pressure for clashes in May
Waterfall of sticky investors cascades into euro IG corporate bond market

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◆ Gulf issuers turn to private markets

◆ Public sector and corporate borrowers to bring forward plans

◆ Banks re-enter covered and unsecured funding markets

US vice-president JD Vance set off on Friday for Pakistan (pictured) for peace talks to end the war with Iran. The talks are part of a two-week ceasefire, announced on Tuesday, that rejuvenated the primary bond market. We spent much of this week's podcast discussing how public sector issuers, banks and investment grade companies would be altering their bond funding plans to take advantage of this positive but unpredictable opportunity to raise capital.

Certainly the ceasefire boosted issuance activity, following Wednesday's rally in asset prices. Banks were more active in unsecured and covered bond funding and there is an urgency among market participants for IG companies and sovereigns, supranationals and agencies to use the time wisely to bring deals while they can. But as we discover, it is not quite as simple as showing up with open orderbooks, given the recent disruption to markets and what lies in store in the months ahead.

We also discussed how the Iran war is the latest situation to arise from Donald Trump's second term as US president to showcase the euro market as a solid, reliable alternative to dollar funding as it begins to attract more issuance from Asia as well as the US.

But for borrowers in the Middle East, public markets seem beyond the pale even with the ceasefire in place. We examine how several of the region's issuers have turned to private placements to fill their coffers.

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◆ Middle East capital securities will need to be refinanced ◆ Supranationals, agencies and municipalities have had a good war ◆ New ideas to promote covered bonds

The central group of bond issuers in the Middle East are the banks. They are well capitalised, with clean balance sheets and often high credit ratings. But none has come to the market since the war began at the end of February.

With fighting raging and a recession predicted, banks’ secondary spreads have widened, especially on the large quantities of subordinated capital they have issued.

That is manageable, and the banks can stay out of the market for a while. But at some point they will need to return — assuming they stick to their word and call capital bonds at the first opportunity.

Where are the safe haven assets? US Treasuries and Bunds are the obvious ones, but the war has made them sell off too, as investors price in rate rises. One market that has stayed remarkably resilient is non-sovereign public sector bonds.

Despite all the noise, investors and issuers have remained calm throughout March, continuing to do deals at sensible spreads — and April could be busy.

Covered bonds rely on a web of regulation — not just the laws that establish them in many countries, but rules governing how much capital banks have to hold against them and how they can use them for repo funding.

Several major regulatory changes are in the works at once, including on risk weightings, cross-border equivalence and blockchain. And the industry has an idea of its own — a pan-European mortgage guarantee.

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◆ Outsiders open EM investors’ wallets ◆ European banks let their hair down in dollar market, still shy in euros ◆ Digital innovation in Frankfurt with DZ Bank

Angola and African telecom company Helios Towers were hardly the issuers anyone expected to restart bond issuance from central and eastern Europe, the Middle East and Africa.

The Middle East war stopped all sales for three weeks, and bankers were looking for a mainstream, investment grade issuer to reopen the market.

But this week it was speculative grade African borrowers — as well as the Serbian republic within Bosnia-Herzegovina — that performed that duty, with successful deals that showed emerging market bond investors are willing to buy.

Although the three issuers were all from the risky end of the spectrum, they are protected from the war’s effects. Whether investors are willing to steer closer to the Gulf’s woes will be tested in the coming weeks.

Another restart happened in euro bonds for European financial institutions. The market has been bare of new issues all month. For a variety of reasons European banks have avoided their home market. Dealmaking picked up this week, with Bank of Ireland showing the way in euros — but most of the action was still in dollars.

Frankfurt is an important node on Europe’s capital market blockchain network, and this week Matthias Bergner, DZ Bank’s group treasurer, joins the podcast to discuss DZ’s latest pilot digital bond, sold to KfW. DZ reckons it is the first bond in which the full lifecycle is on chain.

Digitalising the bond market - sponsored interview with KfW

In an interview on the GlobalCapital podcast this week, KfW's Tim Meirer and Bert Staufenbiel discuss how to move to the next stage in introducing distributed ledger technology to the bond market. They are convinced it can save time, friction, cost and risk.

Interoperability of systems all along the value chain is central to the effort. Meirer and Staufenbiel highlight four essential avenues for progress: open standards, public-private partnerships, modular designs and continuous dialogue.

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◆ What strikes on energy infrastructure in the Middle East mean for emerging market bonds

◆ Why issuing in dollars has become so dicey for supranationals and agencies

◆ Europe's advantage in the private credit metldown

This week we looked into some of the direct and indirect consequences the war with Iran is having on bond markets.

Emerging market issuers are among the most susceptible to commodity price volatility. So with strikes this week against energy infratsucture in the Middle East, we investigated what soaring oil and gas prices mean for this group.

We also discussed the disruption for sovereign, supranational and agency borrowers in one of their core fudning markets — the dollar. We examine why the war has made doing a deal is proving so risky that many issuers are steering clear of what is supposed to be their biggest pool of investment.

Finally, we revisited the world of private credit to discuss the impact of falling valuations of loans made to software companies and how Europe's private credit funds are faring better than their US counterparts.

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◆ Hyperscaler sets new standard for European corporate bond market

◆ What it will it take to get a bank to issue in euros again

◆ Iran war could reshape ultra-competitive Gulf capital markets

For bond issuers to keep away from the primary bond market after a shock, like the outbreak of the war with Iran, is not unusual. But it is when only one group is steering clear when every other is issuing.

For understandable reasons, there have been no bonds from the Middle East since the US and Israel began their attacks, of course. But there has been issuance from elsewhere in emerging markets. That only leaves banks issuing in euros as yet to register a deal in that time.

It's even more curious when they are issuing in dollars and printing covered bonds. We examine why they are holding back and discuss how they might return.

There was still plenty for investors to buy in Europe's credit markets, however. Not least was Amazon's multi-tranche blockbuster, its debut in euros. We uncover what the deal meant for investment grade corporate issuance in Europe.

Finally, we discussed the changing investment banking landscape in the Gulf and how the war raises fresh questions about how sustainable the ledning and bond business is in the region.

Click here to find out more about our GC Live event on corporate hybrid capital, taking palce in London on March 24.

Now read on...

Market debates FIG funding future in euros as primary drought extends

Amazon's €14.5bn money magnet redefines what is possible in credit

Iran war brings Gulf capital markets' competitiveness into question

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◆ How banks and bankers are operating in the region under threat of military escaltion

◆ Bond issuance to resume — but how?

◆ Dwindling fee pool poses questions over long-term future for banks

The Middle East bond market as been one of growing volumes for the last decade and banks both local and international have been pouring resources into the region to grab a slice of the action. But the outbreak of the Iran war last week has temporarily shuttered issuance.

We reveal what bond bankers in the financial centres of Dubai and beyond are saying about their market and how they are operating amid the conflict.

We also talk about which issuers could reopen the primary market in the Gulf, when they might be able to do it and what they will have to pay to do so.

But we also take a longer term view. The Middle East bond market may be busy but it is also one of seemingly diminishing fees. We ask how long banks and their staff can commit to such an enterprise, especially when the security risk of dong so appears to have ramped up.

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◆ UAE issuers leave emerging markets lable behind

◆ What Blue Owl can teach about private credit for the masses

◆ A bump in the road for UK bridging lenders on the way to securitization

Abu Dhabi was in the bond market this week just two days after JP Morgan confirmed that issuers from the UAE would be removed from its benchmark Emerging Markets Bond Indices (EMBI) by the end of March. We look into what EMBI exclusion means for Abu Dhabi and other UAE credits.

We also discussed the recent situation at Blue Owl, which met with a wall of redemption requests from investors worried about the imapct of AI on the software companies that its private credit funds lend to. We discover what lessons private credit and investors can learn about investing in illiquid assets.

Finally, we discuss the future of UK bridging loan companies. It is a market awash with small lenders, two of which recently went into administration. But it had also been an asset class that had appeared to be making inroads into securitization. We look at the best way forward for the industry in light of those developments.

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◆ How AI threat to software biz threatens stockmarket listings...

◆ ... and collaterlised loan obligation market

◆ AT1 market hits new record tight but buyers turn away

Investors are wary that recent AI upgrades — notably Anthropic's latest Claude Cowork agent — are a threat to the software as a service (Saas) sector. This is causing headaches for Saas businesses looking to do an IPO this year as well as the private equity companies that often sponsor them. We examine the threat and what it means for equity capital markets.

Loans made to software companies are also a big part of the collateral for CLOs and here too underlying asset prices are suffering as the same AI peril prompts a cheapening in their value. But that's not the CLO market's only problem. The value of loans made to chemical companies is also on the slide. We discuss the impact on CLOs as an asset class.

Finally, after an incredible run in the additional tier one (AT1) market, a bank has issued one with a reset spread tighter than the psychological barrier of mid-swaps plus 300bp. But there are signs that the market is becoming too rich for some investors. We take a look at this week's landmark deal and look at where next for AT1 issuance, the most subordinated layer of banks' capital structures.

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◆ Why emerging market issuers are doing less in dollars

◆ Republic of Congo — located between rock and hard place

◆ The GlobalCapital Podcast was brought to you by the numbers 17, 100 and the whole Alphabet

Emerging market issuers are diversifying away from dollar funding. We examine which currencies they are looking to raise debt capital with and what is driving them out of the dollar market.

We also dissect the tough choices the Republic of Congo was faced this week as it priced its debut Eurobond at an eye-wateringly high yield. We discuss the sustainability of that sort of debt and what the country's funding options are now.

If there is one thing the US big tech firms like to do, it's disrupt. They grew fat on disrupting old ways of social interaction and doing business and now they're at the forefront of the disruption AI will bring. To fund the enormous amounts of capital expenditure that AI infrastructure requires, they're now disrupting the capital markets too.

Alphabet this week priced 17 tranches of bonds in three currencies to raise more than $31bn-equivalent. That's impressive enough but it showed that in the sterling and Swiss franc bond markets that incredible feats were possible — and from an issuer at the centre of what may prove to be a bubble and which does not have a long track record of issuing in any currency.

Among five sterling tranches, which raised £5.5bn, was a 100 year bond. Meanwhile, its Swiss franc sale has surely alerted other issuers to the size of funding available in that market. We discuss it all.

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◆ Bond auctions get the fintech treatment

◆ Oracle shows how to fund AI capex with bonds

◆ Banks plough on in bonds despite weaker markets

There's nothing new about auctioning bonds as a means to distribute them but this week, fintech BondAuction was involved in a deal for The Housing Finance Corporation that brought new technology to the idea and introduced it to a new section of the market. We discussed how it worked, how it was receieved and whether it will catch on as an alternative to traditional syndication away from the government bond market.

Another big tech theme in the capital markets is how they will accommodate the tech giants' needs for large volumes of debt to fund their AI capex plans. Oracle showed the way with a stunning $25bn bond syndication this week but moreover, it set its stall out for investors the day before, telling them in advance just what it was going to issue.

Like auctions, being clear about issuance plans may be common practice in the sovereign bond market but it was an unusual experience for the corporate mart. That said, now that some of the hyperscalers have borrowing needs akin to some European governments, we thought it seemed a sensible way to behave.

Finally, we looked at the bond market for financial institutions and wondered what could possibly derail issuance there given how strong deal execution has been, even as market conditions falter.

We were also joined by our sponsor MarketAxess's global head of emerging markets, Dan Burke. He spoke to us about developments in the EM bond market and how the electronic bond trading platform his company operates is evolving.

Read on:

https://www.globalcapital.com/article/2fy4nee9yc76lol9nn474/people-and-markets/bondauction-seeks-market-users-willing-to-rethink-syndication

https://www.globalcapital.com/article/2fxsn91h1dgvfuzud1af4/corporate-bonds/high-grade-and-crossover-bonds/oracle-dollar-deal-offers-vision-of-the-future-for-ai-capex-funding

https://www.globalcapital.com/article/2fxy9fidfbtfcbky574lc/people-and-markets/leader/be-less-delphic-with-your-funding-plans

https://www.globalcapital.com/article/2fy424v8m71jpvpfcx1xc/fig/fig-market-faces-uncertain-future-despite-rousing

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◆ Scottish government bonds near

◆ CLOs and private credit

◆ Corporate hybrid debt reaches new tights

Scotland is looking for banks and lawyers to help bring its first bond to market. But the idea raised a number of questions at GC Towers this week. Firstly, what is Scotland? Is it a sovereign issuer, a sub-sovereign, or something altogether new?

Not only did we wonder what investors would be buying but we also questioned what Scotland was selling and why it wanted to do so. Scotland will be a fascinating new issuer in the bond markets and so we discussed what the capital markets have been telling us this week about its desirability as an investment, its credit, how it will be priced and what sort of bond it should issue.

We also investigated the relationship between the public CLO market and private credit. Many think the latter will devour public debt markets but we discovered that the relationship between direct lending and the CLO market is far more symbiotic.

Finally, we revisited the market for corporate hybird debt. A deal for an Italian utility company this week came at a record tight spread to the issuer's senior debt. We examined what has been driving this tightening trend and whether the spread between subordinated and senior bonds still reflects the full amount of risk investors are taking on.

Read on:

https://www.globalcapital.com/article/2fx19pvabc8ynyzx2rz0g/ssa/ssa-market-peeps-at-what-lies-beneath-scotlands-kilts (paywalled)

https://www.globalcapital.com/securitization/article/2fx13snp58ab2tnaepfcw/securitization/clos-europe/clos-find-unlikely-symbiosis-with-private-credit (paywalled)

https://www.globalcapital.com/article/2fx129ypee26j5vqxlmv4/people-and-markets/leader/private-credit-and-leveraged-loans-are-not-necessarily-rivals (free to read)

https://www.globalcapital.com/article/2fx00wjzrye120l8sjlkw/corporate-bonds/hybrid/hybrid-theory-bankers-question-how-tight-corporate-senior-sub-spreads-can-go (paywalled)

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◆ CSG's IPO and the rampant investment for defence companies

◆ Ukraine issuer back in bond market

◆ Fomo sapiens: investment bankings most joyless

Money is pouring into defence, both from government budgets and from investors in the capital markets. The IPO of Czech defence supplier CSG this week was an extraordinary transaction — the largest European listing to date and the biggest ever from the industry. We dissect the deal, discuss the industry's prospects for capital raising and examine the pipeline of defence sector equity capital markets activity to come.

The Russian invasion of Ukraine in 2022 has been, of course, a major driver of increased defence spending. Meanwhile, it has shuttered Ukraine's borrowers from the bond market. But this week, one of its major bond issuing companies retruned to the primary market for the first time since the war began.

MHP, a chicken and wheat producer, has priced a deal to refinance some maturing debt. We look at what has changed in the almost four years since Russia's invasion for Ukraine in the bond markets, why a company rather than the sovereign was the issuer that reopened the market, and which other borrowers might now do deals.

Finally, we were joined by columnist Craig Coben, to discusss the psychology of working in an investment bank and just how it can be that people who appear to have it all from the outside can often seem so glum — I was looking for a well paid, prestgious job and then I found a well paid, prestigious job; and heaven knows I'm miserable now, as The Smiths might have said had they put down the instruments, picked up a an HP-12C and gone to work for Morgan Grenfell back in the day.

Craig explains his term for the phenomenon — Fomo sapiens — and discusses with us investment banking culture and whether there is a route to a happier existence while still missing the odd client mandate.

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◆ Public sector issuers embrace hedge fund bid...

◆ ... as they flex in the swap market

◆ Car makers welcomed back to bond market

Allocating more of a new issue to hedge funds has long been something SSA issuers have only done if they absolutley needed to. But that is now changing. Issuers are giving more bonds to the so-called fast money but only if it slows down. We discuss which types of hedge funds are getting more SSA bonds, why they want them and what they are prepared to do to get them.

Another important but rarely talked about influence on SSA bond issuance is the swap market. Some issuers are starting to show more flexibility around when they use it to hedge their debt exposures. We discuss the dynamic and what it means for both the derivatives and bond markets.

Finally, we highlight the stellar start to the year for car makers in Europe's corporate bond market. This is an industrial sector that investors have fretted about in the recent past so we examined what is driving demand for their new issues so far this year.

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◆ What has driven this week's record issuance and what might threaten sentiment

◆ Why the Maduro affair is a wake-up call for the EU

◆ Resolving Venezuela's debtberg

After a rip-roaring start to the bond market this week, we take a look at just how good it is for issuers and what has driven the huge volumes. Sure, the Epiphany holiday on Tuesday pushed issuers to do their euro funding in a particularly narrow window, but greater forces are at play across the rest of the market.

We examine that issuance through the prisms of the sovereign, supranational and agency bond market and also that for CEEMEA issuers. We explain why carrot and stick are driving the latter group to fund at such speed.

One of those factors is geopolitical shocks and this week the US provided at least two. It arrested the Venezuelan president Nicolas Maduro and said it would "run" the country instead of him. That raised fears that it might try the same in Greenland. We make the case for why this should drive the EU to push the euro's status as a global reserve currency.

Finally, we look into Venezuela's vast debts — the bits we can see at any rate — and discuss the likelihood of restructuring now that Maduro is gone.

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◆ Data centres: crunch time for Europe's capital markets

◆ How AI is changing capital markets work...

◆ ... and hiring

It is no secret that data centre financing will be an increasingly important part of the capital markets in the years ahead. But this week we discuss why it is such a vital test for the EU's capital markets and the bloc's overall competitiveness as we contrast the progress in data centre securitization between the Europe and the US.

We also take a close look at the changes AI is making to how people in the capital markets do their jobs. Despite all the talk of distributed ledger technology and digital bonds, the most senior debt capital markets bankers believe AI will be the biggest disrupter to tehir world of the choices offered in GlobalCapital's recent survey (they also say DLT is the most overhyped of the options). We discuss exactly how AI is being used in the markets and assess its potential.

These stories, along with the survey of the heads of DCM are just some of the features in our Review 2025 | Outlook 2026 special report, which is free to read. It contains outlook pieces based on surveys of all of the major markets that GlobalCapital covers as well as interviews with some of the markets' biggest bond issuers and stories about the biggest themes that will affect capital markets in 2026.

Read it here: Review 2025 | Outlook 2026

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◆ Simplification plans boggle bank boffins

◆ Hungry, hungry hyperscalers to push utilities into bond market

◆ A loan in the sand: private credit jostles for place in Middle East debt markets

On last week's episode we discussed how the ECB was preparing to recommend simplifications to the way EU banks are regulated, in order to make them more competitive and to drive growth. This week it made its recommendations but they seem far from simple and contain suggestions to abolish the most subordinated layer of bank capital altogether — additional tier one.

We delve into what the ECB said, experts' reactions to the news and discuss what changes will follow.

The demand for data centres and their thirst for energy is likely to lead to another bumper year for Europe's corporate bond market. But it won't just be the big US tech companies bringing deals. Utility companies are also expected to raise cash for capex as they power up their grids to feed the big data beasts.

Finally, with private credit seemingly spreading its tentacles into so many debt markets, we take a look at how it is gaining a foothold in the Middle East, where the need to raise capital is ballooning, and assess the threat it poses to public markets.

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◆ Private credit and equity to come under oversight for first time...

◆ ... as Bank of England eases burden on banks...

◆ ... amid global shift to lighten up on lenders, with ECB expected next

Alternative asset managers will finally come under the Bank of England's scrutiny, the central bank and regulator said this week. We discuss in detail how that will work and what the implications for the ballooning sector may be.

Two days before it announced its plans, the BoE also lightened the regulatory load on the banks under its supervision — for the first time in a decade. We examine the relief on offer and whether it will affect the issuance of subordinated debt.

We also consider the changes in their global context, with the EU and the US also looking to make their banks more competitive and better able to drive economic growth. We look at what the ECB might be about to reveal next week.

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◆ UK government guns for growth but did it miss?

◆ French fancy: FIG in favour again

◆ Pandas and Wontons with the AIIB

After months of speculation, the UK government delivered its Autumn Budget this week. The country may have felt like it has been through the worst of times but are we about to enter the best of times? We pick through the policies to see how they will affect capital markets from IPOs to retail investment.

In the immediate future, market participants are tipping sterling bonds to appear from corporate issuers. We discuss the pipeline of deals to come.

We also discuss another country where there has been plenty of political intrigue and economic strife: France. A number of French banks recently came to the bond market with successful new issues. We examine what that tells us about investors' and issuers' view on French risk.

This episode of the GlobalCapital Podcast is sponsored by the Asian Infrastructure Investment Bank. In a special interview, we spoke to the bank's head of funding, Darren Stipe about its role in the Panda bond market, and it's creation of the nascent Wonton market.

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◆ Are investment bank bonuses going up this year, and when does everyone get paid?

◆ How the UK government's 'binary' Budget is affecting bank bond issuers

◆ Legal pressure builds on MDBs to reassess climate impact

The UK government's Budget announcement next week has been the source of rabid speculation for months. The uncertainty is affecting how banks in particular approach the sterling bond market to fund themselves. We explain the dynamics in play.

Meanwhile, an NGO in the US is applying pressure to multilateral development banks to change the way they assess energy project financing to consider environmental factors. We explain why the legal opinion the campaign has generated matters, what it says and how MDBs may react to it.

Finally, we investigate investment bank bonuses. We explain how the whole process works from initial discussions within a bank to when the cash and shares are paid and also discuss some of the shenanigans that go on at this time of year. We also share what our columnist Craig Coben had to say this week about how to successfully argue for better compensation.

UK Budget a ‘binary event’ for sterling FIG issuance

Law scholars shine spotlight on MDBs’ climate loopholes

Bonus time: who is expecting what and when

‘Please sir, I want some more’: why Oliver Twist will never make MD

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◆ Private credit, banks or securitization — which one is regulated too lightly?

◆ How AI capex will affect Europe's bond market

◆ What do defence bonds achieve?

Two senior UK bankers were in the House of Lords this week pleading for lighter regulation in the face of competition from private credit and their US rivals. One, Michael Roberts, the CEO of HSBC Bank plc and its CEO of corporate and institutional banking, even implied that securitization may be too lightly regulated as part of his argument. We discuss what he meant by that and debate whether private credit is a systemic risk that should face tougher standards

Bpifrance issued the first bond to carry the European Defence Bond label in the public sector bond market this week. The new label is finding its feet, so we question what it achieves, what it is missing and how it might catch on.

Finally, we gasped at the staggering amount of capex that big US tech firms want to do to fund AI spending. Some of it will be done in the European bond market through Reverse Yankee issuance. Market participants worry that this is bad news for European issuers. We examine why and whether they are right to fret.

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◆ Why Europe's corporate bond market is on a roll

◆ Reverse Yankees, hot hybrids and huge size with more to come

◆ Europe's stock exchanges' attempts to drum up more IPOs

Market participants had expected this week to be a busy one for euro and sterling investment grade corporate bond issuance. But the volume of business that was done exceeded all expectations.

With jumbo deals from the likes of Alphabet to successful offerings from less common credits like Brisbane Airport, benchmark issuance this week was almost four times the volume of the weekly average for the rest of this year. We examined why and discussed the factors that will keep the deal spree going deep into November.

Within that sector were also some notable hybrid deals in euros for US companies. We inspected these and divulged what is driving this market.

We also looked into what different European stock exchanges, and their regulators, are doing to boost not just the supply of public stock listings but also the demand.

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◆ Pause clauses could add to disaster arsenal

◆ KfW CEO Stefan Wintels on bond digitisation

◆ What ESG backlash? Banks ramp up green bond issuance

As Hurricane Melissa ripped through the Carribbean this week, the bond market had a part to play in helping Jamaica fund its recovery from the storm. That came in the form of a catastrophe bond, which we explain in detail, but we also discuss how sovereign debt could be tweaked in future to help stricken countries get by.

German promotional bank and leading bond issuer (not to mention recent GlobalCapital Podcast sponsor) KfW is an important player in the European economy and in global capital markets. Its CEO, Stefan Wintels, joined us to discuss the bank's role in the German economy as the country ramps up infrastructure and defence spending, Germany's green transition, and the digitisation of the bond market.

We also delved into why Europe's banks have recently boosted their issuance of green and other labelled bonds.

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◆ What is pushing CLO mezz wider

◆ FIG pre-funding underway

◆ What happened at the World Bank/IMF Annual Meetings

The CLO market is both subject to and affects what happens in leveraged loans, risking distortion in the latter. First, we discuss why the riskier bits of the CLO stack are trading wider. Then we delve into why CLOs give us cause to think that leveraged loan pricing may not purely reflect the credit quality of the borrowers.

If you like listening to GlobalCapital talking about securitization for free, be sure to listen to our dedicated podcast: Another Fine Mezz.

In the bank bond market, issuers are raring to pre-fund to get ahead of what may be a risk-laden 2026. We discuss the pitfalls that await, how issuers can mitigate them and why, contrary to what might normally be the case, covered bonds are not the way to do it.

Finally, we talked about the big issues that cropped up at the World Bank/IMF Annual Meetings this year, including how multilateral development banks operate and what happens to the ESG agenda when many of its biggest proponents show up for a week on climate naysayer US president Donald Trump's doorstep.

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◆ Holders win write-down ruling but path to recovery uncertain

◆ StrideUp brings Islamic innovation to UK securitization

◆ Emerging market bonds have an off-week (almost)

We picked apart a Swiss court ruling this week that overturned the country's financial regulator's decision in March 2023 to write-down Credit Suisse's additional tier one (AT1) paper.

The decision was controversial at the time because the AT1 holders came out worse from the collapse of Credit Suisse than shareholders — an upending of the traditional creditor hierarchy. But the ruling raises just as many questions as it answers about what investors are now due and who should pay it.

In the UK RMBS market, StrideUp is bringing an innovative deal that, if successful, could show a way to help finance the country's 4m Muslims' path to home ownership without them having to compromise their faith.

We explain how this Sharia-compliant securitization works and discuss whether it will catch on.

Finally, after smashing issuance volume records just last week, emerging market bond issuance dried up this week. We examine the causes but also unearth some bright spots in the primary market that give optimism for the weeks ahead.

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◆ Why buy bonds when spreads are so tight

◆ Using tech to unearth new economic signals

◆ Playing the shifting relative value pitch

This week, in an exclusive interview with world's largest investment manager, BlackRock, we discussed how much tighter credit spreads can go, what is driving it and how the company is adjusting to underlying shifts in relative value.

We also debated tech: whether digitalisation of the bond market is all it's cracked up to be for the buy-side and how BlackRock is using technology to find new economic signals to guide investment decisions — especially prevalent at a time when traditional sources, such as government publications, may be turning less representative and reliable.

We talked about all of this and more with Simon Blundell, BlackRock's head of European fundamental fixed income investments. BlackRock is the world's largest investment firm, running $12.5tr of assets.

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◆ Italy dazzles with size as we launch our new MTN Awards

◆ Enel snubs the market it created

◆ Record month for CEEMEA bond issuers

Italy showed just what the medium term note market can do for borrowers this week as it priced a €700m deal. We examine what the benefits were to the issuer.

We are also launching our first ever dedicated MTN Awards. We tell you how they will be awarded and how to take part but you can also click here to find out more.

We also discuss what Enel's decision to ditch sustainability-linked bonds means for the product that it created. The SLB market has slowed of late but we argue that there is plenty of life in it yet.

Meanwhile, there was no let-up in the pace of emerging market bond issuance this week. We look at who brought deals and why the market is so hot right now.

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◆ QNB deal to pique Gulf interest in euro issuance

◆ Denmark develops green market with EuGB

◆ Foreign AT1s return to Aussie market

GlobalCapital began life in 1987 as a weekly newspaper called EuroWeek, dedicated to tracking the international flows of capital developing in the growing Eurobond market. This week provided some classic examples of the genre as borrowers looked abroad for new sources of cash.

QNB, a Qatar bank, priced an eye-catching bond in euros this week. It was the issuer's first in the currency and offered a tantalising glimpse of an underexploited pool of cash to Gulf borrowers. We discuss why the region's issuers can and should visit the market.

Denmark, meanwhile, may not have come to the international markets but it did do an important green bond — one that adhered to the European Union Green Bond Standard. We delve into why this trade was such an important development for this nascent asset class.

Finally, UBS brought the first additional tier one bond in Australian dollars for six years. Again, the deal will tip off other big European banks that there is cash to be raised in the Australian market. We explain why AT1s work in Aussie dollars even after the Australian regulator binned the asset class for its own banks in what is an illustrative tale of how important the market is becoming to international bond issuers.

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◆ Bank issuers and investors anticipate EBA report on regulatory equivalence

◆ Mediobanca enters its Monte dei Paschi era

◆ The case for not keeping Russia's money

The bank finance industrial complex descended on Seville this week for the European Covered Bond Council Plenary, FT Live's Covered Bond Congress and GlobalCapital's Covered Bond Awards.

This annual series of events captures more than just what is happening in the covered bond market and has become a major date for anyone involved in how banks finance themselves. But one key area of debate was how different regulatory regimes will treat the asset class. Florian Eichert, head of covered bond and SSA research at Crédit Agricole joined us to discuss the latest developments.

Meanwhile, Mediobanca is adjusting to life as part of the Banca Monte dei Paschi family. We discuss how the Italian investment bank will adjust to its new owners.

Finally, we examine whether calls to seize Russian assets held within the EU are all that smart and what the risks of doing so might be.

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◆ Colombia turns from Swiss francs to eurozone in funding flurry

◆ CEEMEA issuers enjoy purple patch

◆ A test for US auto ABS as Europe's RMBS market gets boost

Colombia has been on a world tour of debt markets lately. It priced a bond in euros this week for the first time in years, following a gargantuan loan in Swiss francs last month. We find out what the Latin America sovereign is up to.

It wasn't the only emerging markets issuer making a splash recently either. We investigate why the market is so hot for these credits and what deals are left to be done.

Meanwhile in the US, a car finance company called Tricolor has sought bankruptcy protection. The firm is also an ABS issuer. We discuss what the situation means for its outstanding paper and the banks that provided it with warehouse financing.

Finally, the European RMBS market has had a subdued year. Two securitizations of Santander mortgage portfolios by two US banks have given it a boost this week. But, we ask, why couldn't Santander — a veteran of the asset class — securitize the portfolios itself?

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◆ Record Gilt and hot sterling bonds give the lie to ‘UK crisis’ chatter

◆ Emerging market bonds bask in rampant demand

◆ Qualms creep into public sector bonds as investors get choosy

In a week of sharp contrasts, parts of the bond market are enjoying exceptional conditions for issuance, while others are feeling uneasy. Sometimes both interpretations are given of the same market — like sterling bonds, which have been hammered in the press this week as about to spiral into another ‘Liz Truss moment’.

To sterling bond professionals, the media doom-mongering is like a lurid dream — it has scant connection with reality.

On the very day that caused most alarm, when the 30 year Gilt yield spiked to a 27 year high, the UK calmly issued its largest ever Gilt — and plenty of corporate and bank issuers made hay in the market too.

In the emerging markets of central and eastern Europe and the Middle East (CEEMEA), investor demand is red-blooded, and issuers are responding with waves of deals. The market is on course to break records, but borrowers can still trip up if they price too aggressively.

Supranational, sovereign and agency bonds are flecked with light and shadow. While deals like the UK’s and Italy’s have blown out and set new highs, the odd issuer amid the throng has found the market surprisingly hard going. The mood has cooled since August — what will happen next week when the French government is likely to fall?

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◆ How French issuers are responding to political ructions

◆ French corporate, agency, bank and sovereign bonds discussed

◆ French lender brings innovative European Defence Bond

French prime minister Francois Bayrou's decision this week to hold a confidence vote in his government is likely to be a key influence on European capital markets for the immediate future and possibly beyond.

We discuss how it is affecting the borrowing costs and behaviour of different issuers from the country and further afield — from its agencies and the European supranationals, whose spreads took a hit this week, to its investment grade companies, which did some surprising deals.

We also look at an innovative deal from French bank BPCE. It priced a bond the proceeds of which will finance defence. Rising defence spending will be a huge and controversial topic for the capital markets and society for years to come so we examined whether this new label would be one that will stick, what it can achieve for the issuer and the defence industry, and what we can deduce from the execution given the politically-driven market volatility.

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◆ Why investors are piling into SSA bonds despite the tight spreads

◆ Bank AT1 issuers spy chance

◆ EDF pioneers in Kangaroo market

Benchmark bond issuance resumed across asset classes this week. In the SSA market, we investigated why issuers were able to build record order books for huge bonds when spreads are so tight.

We also inspected a restricted tier one deal from Allianz to see what it meant for banks looking to issue their version of that level of capital — additional tier one.

Finally, we looked at a rare trade from France's EDF in the Kangaroo market. Aussie dollar funding is of growing importance to the world's bond issuers so we looked into what the implications of this long-dated deal would be for other companies.

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◆ Exclusive interview with Amundi portfolio manager, Jonathan Manning

◆ Navigating fixed income amid tariff disruption

◆ Investing at tight spreads

Yields are high and defying predictions that they will fall. Meanwhile, spreads are tight across credit markets with recent new issues pricing at or through fair value.

Then consider erratic US trade policy, the early signs of international investors abandoning dollar assets and the rise of private credit into investment grade credit, and you have an awful lot to think about as a fixed income portfolio manager.

All of which was why we were delighted to speak this week with Jonathan Manning, senior global credit portfolio manager at Amundi, Europe's largest asset manager, who talked to us about all of that and much more besides.

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◆ Wendel proves the summer market isn't just for the big boys

◆ Trio of new issues show buoyant market for banks

◆ Private credit's threat to the investment grade bond and loan markets

Both the investment grade corporate and financial institution bond markets this week hosted stellar new issues, proving that for certain issuers the perceived lack of summer liquidity is a fiction.

Wendel broke its usual issuance pattern to price a very successful new issue, proving that it isn't just the biggest blue chips that can get deals done. We ask what Wendel's success has done to the immediate pipeline in that asset class.

Meanwhile, there was a hat-trick of well-received new issues from major bank issuers. We look at the options for FIG issuers across the capital stack in light of these trades.

Finally, the rise of private credit is one of the hottest topics in finance. Traditionally a source of cash for sub-investment grade companies, investors are now looking to lend to the best rated borrowers. We discuss whether this is a threat to the bond and loan markets.

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◆ Mexico throws Pemex innovative debt lifeline

◆ Callable ZCs in vogue for public sector issuers

◆ Why ECB regs update will drive insurance capital issuance

Pemex, Mexico's state-owned energy company, is a storied bond issuer. But lately it has been in a spot of bother. We explain what has been going and what an innovative bit of financing organised by the Mexican government this week — a P-cap — will do to ease the company's debt burden.

Meanwhile, a particular group of investors is buying callable structured notes from public sector bond issuers. We reveal who, the market forces driving this trend and what's in it for the investors, issuers and the banks that put them together.

We also discuss the ECB's latest regulatory update on what is known as the Danish Compromise. The guidance on this piece of regulation that governs how banks treat the capital of the insurance companies that they own is likely to lead to more issuance. Insurance capital is a small, specialist but popular asset class. We debate whether this will be its lift-off moment.

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◆ EU budget ambition to cement issuer status

◆ French spreads

◆ Finally, the European bond market's consolidated tape

The European Commission has launched what its president, Ursula von der Leyen has called its "most ambitious" budget proposals. They include a heap of joint borrowing to be done by the EU, cementing its status as a permanently huge bond issuer. We look into the numbers to see what it means for the SSA bond market.

Meanwhile, in France, covered bonds look set to trade through government bonds. Again, the government's budget has a part to play as we investigate what this pricing dynamic means for different groups of investors.

We also herald the dawn of the EU's consolidated tape for the bond market, which aims to bring better price transparency. We explain what it will contain, what it won't and why it matters.

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◆ UK rule change cheers covered bonds...

◆ ... as it shelves Taxonomy plans amid wider transition shift

◆ Digital markets: what makes a swap smart

The UK is going for growth and is making a regulatory revamp part of that programme. Chancellor of the exchequer Rachel Reeves said this week in her Mansion House speech that "in too many areas, regulation still acts as a boot on the neck of businesses" and that she was part of a government that has "swept away" regulations.

Whether it has or not can be debated but there were two key regulatory developments in the UK for the capital markets this week. The first was a decision to set-up an equivalence regime for covered bonds. We explain why that is such a boost for the asset class.

Secondly, the UK said it would not produce a green taxonomy. We examine why that might be and what the benefits and costs are. This is particularly pertinent as the transition to a low carbon economy evolves. We also discuss how that pursuit is changing and how it affects the capital markets.

Finally, with news of an agency issuer and a bank entering into a digital smart swap contract, we discuss what they are, what problems they solve, as well as some that they don't.

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◆ Stellar conditions for issuers across the bond market

◆ How bond issuance will pan out over the rest of the year

◆ Dedollarisation discussed

The relatively few issuers that took advantage of the primary market this week were well rewarded. US tariffs were kicked down the road once more meaning low volatility and so investors were happy to chase what deals they could find.

But is the market about to quieten down for the summer just when it seems there could not be a better time to issue bonds? We look at the arguments for and against and take the pulse of primary across SSAs, FIG, covered bonds, corporate bonds and emerging markets.

And we don't just think about when issuance will resume in size but also what the market will look like in the future with dedollarisation a growing topic for investors and issuers alike.

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◆ SSA yields bump up against US government curve with deficit set to spiral

◆ Waning CEEMEA ESG bond issuance

◆ Leaner, meaner SLL market

The SSA bond market has enjoyed its fair share of eye-catching relative value inversions of late. Last year, the likes of Portugal and Spain began trading tighter than France in the European government bond market, for example.

But after US president Donald Trump got his budget voted through on Thursday, it could be about to witness the mother of all RV upsets — bonds trading though US Treasuries for the first time ever.

This week we look at the arguments for and against why this should happen and think about when it might occur.

We also looked at some slowing areas of ESG capital markets. ESG-labelled bond issuance is falling in the CEEMEA bond market despite some recent high profile deals. We examine the theories behind why this is happening.

Meanwhile, he sustainability-linked loan market is a shadow of its former self. We find out why and argue that this might be a good thing, showing a market gaining in sophistication.

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◆ SSA market faces up to escalating defence funding

◆ Arms company bonds in focus

◆ Slovenia's landmark SLB

As Nato members agreed — mostly — to ramp up their defence funding to 5% of GDP over the next decade, we asked the SSA bond market how it would handle the extra funding that it will need to provide for that end.

Some Nato members don't even meet the old target of 2% of GDP, so this week's declaration made at the alliance's summit in the Hague was quite the escalation. It came in the same week that some of the SSA market's biggest borrowers released their latest funding targets too.

Meanwhile, extra defence spending is a boon to arms companies. They have been spectacular performers in equity markets but we took a look at what all that extra business and revenue will mean for their bond issuance.

Finally, Slovenia this week became the first European sovereign to price a sustainability-linked bond. We examined the deal, how it was priced and marketed, and ask whether this is a credible avenue of funding for other governments.

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◆ Issuance abounds despite Iran-Israel escalation

◆ European securitization regulatory proposals unveiled

◆ A digital first for sovereign bonds

If you only consumed mainstream news, the escalating conflict between Israel and Iran — and potentially the US — might lead you to assume that such global turmoil would make it a bad time to be issuing debt.

But if you only observed the capital markets to the exclusion of all wider news, you'd be forgiven for thinking the world was a stable, peaceful and certain place.

Issuance in credit markets has boomed even as the prospect of a wider war ramped up this week. We examine why investors are so keen to take on risk at such an uncertain time and how long it can last for.

Meanwhile, the European Commission has revealed a raft of proposals with which it hopes to boost the EU's securitization market. We pick through plans to see which the market likes, and which it doesn't.

Finally, Luxembourg achieved a digital bond first this week; pricing a bond using distributed ledger technology that was sold to investors. We explain what this advance means for digital debt issuance, and ahead of our GC Live event in September on the same subject, look at where digital capital markets are at versus where they need to get to.

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◆ How can the EU capitalise on US mistakes? ◆ New US insurers head to euros ◆ The greenest of green

The good and the great of Europe's capital markets gathered for the International Capital Market Association conference this month, and the overwhelming consensus among the speakers was that this was a rare chance for Europe to chip away at US bond market dominance.

But it won't be easy, with myriad regulatory and idiosyncratic problems that can only come when 27 countries try to agree on a complex set of rules.

Elsewhere, US insurance firms have fallen for the allure of printing bonds in euros. We discuss what is driving this spate of debut issuance and whether more might be coming.

And in the sovereign, supranational and agency market, CAF sold a hybrid deal this week. This unusual structure for the esteemed SSA market is still finding its feet, but there was plenty to pick at from the CAF deal to get an idea of what is coming next.

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◆ How worrying is Section 899? ◆ A summer of toil for public sector issuers ◆ Seesawing curves in FIG

The bland outpourings of ChatGPT could not be further from the penetrating, critical advice big companies, governments and investors want from investment banks.
But could one foster the other? That is the ideal banks are striving for with a plethora of projects to use artificial intelligence — not for the hard stuff, they say, but for the easy stuff.
Automating tiresome work like compiling presentations could free up time — especially for junior bankers. But what are the juniors going to do with their free time?
Sir Siegmund Warburg, founder of SG Warburg in 1946 and father of modern European investment banking, had a few ideas…
One task human intelligence is struggling with is understanding Section 899 of President Trump’s One Big Beautiful Bill. Clearly intended as a revenge tax to penalise investors in countries whose tax policies the US considers unfair, its scope of implementation is very unclear. So far, debt capital markets have paid little attention, but it could bite them hard.
And this week in the market, supranational, sovereign and agency borrowers were packing in the funding. Could June be another January, stuffed with deals? And could January stretch into July?
The curve balls Trump is hurling at the economy are leading to weird dynamics in the financial institution bond market, with the curves for covered bonds and senior debt undulating differently. Can issuers and investors make sense of it?

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◆ EU’s securitization plan leaked ◆ The first new EM sovereign issuer for years ◆ Who can be sued for climate change?

Interest rates coming down was supposed to be a sure bet. Now it’s not. Long government bond yields are rising, and not just in the US. Investors are worried — the term premium is climbing, which means it’s not enough now. It’s safest to stay away from duration.
We try to diagnose this queasy market for high quality bonds. Are there any silver linings?
MLex, a regulatory news service, has leaked two crucial draft proposals from the European Commission for how it will reform rules on securitization. Will they ease what the market feels is regulators’ stranglehold?
It’s six years since the last new sovereign bond issuer appeared from a true emerging market, but the Kyrgyz Republic came this week. The bond was a hit — we explore what it means.
You may not have heard of Huaraz — or Hamm. But you’ve probably heard of RWE, the German power company which has been called Europe’s biggest carbon emitter.
This week an appeal court in Hamm, Germany denied a lawsuit by a farmer from Huaraz, Peru. He had sued RWE for damages for the risk to his home from global warming-induced flooding.
But his supporters believe they achieved their aim: establishing that carbon emitters can be held liable for climate change.

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◆ Capital markets' Bloomberg scare
◆ SSAs tipped to go sub-US Treasuries
◆ Jumbos devour credit demand

A blip in Bloomberg's terminal services this week delayed bookbuilding on a number of syndications and bond auctions. It passed with seemingly little harm done. But it did reveal how dependent bond issuance and fixed income has become on the company's platform.

We asked what would be at stake if there was a longer outage and what can be done to prevent major disruption.

Meanwhile, rising US Treasury yields mean SSA bonds are trading at ever smaller spreads over them. It wasn't that long ago that issuers questioned the wisdom of trying to price bonds at a single-digit spread to the US benchmark. This week a German issuer built its biggest every orderbook in the currency with a bond that came at 7bp over — it then tightened to 3.5bp over.

Now the SSA market is wondering if or when an issuer will price through what is supposed to be the world's rick-free benchmark security. We lay out the cases for and against.

Finally, we ask whether the European corporate bond market is running out of steam after one jumbo deal too many, and we also take a look at the bustling market for the riskiest part of a bank's capital stack: additional tier one paper.

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◆ What happened at the EBRD's Annual Meetings
◆ Romania's new president and the fiscal fright that awaits him
◆ Investors distracted from FIG by US corporates

GlobalCapital was on the ground at the European Bank for Reconstruction and Development's Annual Meetings in London this week. We reveal what was discussed and decided, from the bank's capital situation and US involvement, to its support for Ukraine and beyond.

Meanwhile, Romania goes to the polls this weekend. Whoever wins the presidential election faces the challenge of bringing down a big deficit. As one of the emerging markets' biggest bond issuers, that may have repercussions for its credit.

Finally, we looked at the interplay between two different parts of the credit markets this week as US corporate issuers' stole European banks' thunder. We look ahead to how this will affect issuance to come.

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◆ US gives further clues on MDB support
◆ FIG issuers face funding choices
◆ What's the point of the EU green bond standard?

We surveilled the SSA bond market this week and the development finance world to see what both made of US decisions about financial support for a number of international development funders. The result was relief but it was not unqualified, as we ponder what this may mean for US president Donald Trump's review into the country's involvement in international financial institutions.

Meanwhile, banks are facing a stark choice about whether to raise covered bond funding or to do unsecured deals. We examine their options and the factors affecting their decisions.

Following a deal from Iberdrola this week, we also look at how enthusiastic issuers have been to bring bonds under the EU green bond standards, a new label denoting use of proceeds aligned with the bloc's Taxonomy of Sustainable Activities, and whether there they offer the market any real benefit.

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◆ SLBs miss targets with hundreds more up for review
◆ US issuers make hay in European sunshine
◆ Banks probe longer dated debt issuance

The wave of sustainability-linked bonds that were all the rage a few years ago are now reaching the point where their issuers' performance against their environmental KPIs is being judged.

Two issuers this week have failed to meet their targets and will pay higher coupons as a result. We took the opportunity to see what impact this might have on supply and demand for a product that has become a niche when at one point it threatened to be the next big thing, or whether there are other factors that will help or hinder its renaissance.

We also look at some eye-catching bond issues in euros by high profile US companies, including a debut from Alphabet, to see what is driving issuance.

Finally, we discuss banks' long-dated funding options in the bond market.

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◆ Insiders assess Scott Bessent's speech on MDB reform
◆ European Commission's latest attempt to ease capital market access
◆ Encouraging signs for credit issuers after tariff turmoil

The US administration gave some clues as to its beliefs on how the IMF and the World Bank should change their operations for the first time this week since president Donald Trump signed an executive order in February asking for a review into the country's involvement in international financial organisations.

US treasury secretary Scott Bessant outlined at an event in Washington, DC to coincide with the IMF/World Bank Spring Meetings his gripes with the two institutions. We discuss if and how reform can be achieved and what the bond market and development finance specialists made of what Bessent said.

The EU meanwhile has launched a consultation into removing capital barriers across the bloc. We discuss what it wants to achieve and whether it is likely to do so.

Finally, after weeks of US tariffs causing turmoil in capital markets, we look at credit to see how issuers are finding their way back to the primary market and adjusting to the new level of spreads.

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◆ Running a bond business in a crisis
◆ Bank issuers find their way back into the bond market
◆ Can frontier emerging market sovereigns fund themselves?

This was supposed to be a decent year for banks in the debt and equity capital markets. But the uncertainty generated by a chaotic US tariff policy has wrecked investment banks' ability to plan and operate in their markets.

We look at what is grinding the sell-side's gears and investigate how banks should navigate the volatility to meet their budgets.

One area of the bond market where issuance has been slow to resume since the US first announced its new tariffs is the senior unsecured FIG market. Issuers returned this week, so we took the opportunity to examine where FIG borrowers can raise debt capital from covered bonds all the way down to subordinated debt.

The yields on many frontier emerging market sovereign bonds have gapped higher this month to above the 10% level that many consider the beginning of the death zone for debt sustainability. We ask whether this has the makings of a debt crisis, or if issuers are well prepared to weather the storm.

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◆ Did we come close to a full blown crisis before Trump's tariff climbdown?
◆ Will we face another in 90 days' time?
◆ UK regulator's astonishing covered bond ruling

We looked this week into whether the US's decision to postpone the imposition of punishing tariffs by 90 days averted a financial crisis, or merely postponed it.

The action in the US Treasury market was not good this week as investors and traders appeared to pile into cash rather than assets. Stock markets were red but the US government bond market caught no safe haven bid and sold off too.

The peril abated with the tariff postponement on Wednesday but there were signs of a brewing crisis in the run-up to that decision. We ask whether markets will be better prepared in July if the US goes ahead with its trade policy.

We also delve into a decision by the UK regulator, the Prudential Regulation Authority, to disallow non-UK covered bonds from counting as high quality liquid assets for UK banks. We explore the ramifications for UK lenders and the covered bond market.

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◆ How US tariffs will affect bond issuers in the medium and long term
◆ Liberation Day: your funniest quotes
◆ A funding update from KfW's head of capital markets, Petra Wehlert

US president Donald Trump's imposition of a vast swathe of tariffs on imports bludgeoned stock markets this week and proved the stuff of nightmares for investors as they contemplated the possibility of recession and the return of inflation.

But the reality for the bond market will likely be rather more nuanced. We picked our way through Europe's investment grade corporate and financial institution bond markets to see what "Liberation Day" will mean for credit issuers' immediate deal pipelines and the longer term.

We also discussed the ramifications for the many varied economies and borrowers in the CEEMEA region as we followed the trail of cause and effect from the Oval Office to South Africa and Romania, and via China to Nigeria and Saudi Arabia.

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◆ Farewell, KommuneKredit ◆ Covered bonds advance on SSAs’ territory ◆ Ivory Coast makes funding breakthrough ◆ Romania’s risks

Genuinely useful applications of AI are still rare in capital markets, but UniCredit has come up with an intriguing one. It has built a tool called DealSync that is helping it generate M&A mandates.
The supranational, sovereign and agency bond market was shocked on Wednesday to learn that it would be losing a well known issuer, KommuneKredit. The Danish government has decided it will be cheaper to just issue bonds itself. Could other agencies disappear?
Covered bond spreads have been getting tighter and tighter, while SSA spreads are widening. Might covered bonds actually start pricing inside some of the best public sector issuers such as German states or Dutch agencies?
In emerging markets, heavy issuer Romania’s dual tranche bond this week went well, but there were telltale signs of the funding stress the country could face if it does not resolve its political difficulties and huge budget deficit.
Ivory Coast has a better story to tell — it has become only the second African country to issue an international bond in its domestic currency. This funding technique, widely used in Latin America and central Asia, holds out hope of reducing African countries’ need to borrow riskily in hard currency, exposing themselves to FX risk.

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◆ UK fires starting pistol on digital Gilts ◆ SSA market absorbs EU defence funding detail ◆ Credit issuers adjust tactics

The UK has begun a consultation as it looks to issue its first digital Gilt - to be called a DiGit. We discuss what the bond will look like and the UK's route to issuance.

Elsewhere in the SSA bond market, participants took stock of further detail on how the EU plans to fund its Security Action for Europe (SAFE) scheme. We examine the details and the bond market's reaction.

We also revisit the primary credit market where things were starting to turn for the worse last week to see if FIG and corporate issuers have found a way to keep investors happy.

And finally, we bring news of a brand new data product for the medium term note market from GlobalCapital.

Now read on:

UK sets fast pace for digital Gilt, hoping to catch up on DLT

Ipsen blowout lays blueprint for corporate blockbusters

FIG issuers increase new issue premiums to boost volumes

SSA market ‘still unclear’ how EU's joint defence funding could work

EGB market grapples with European rearmament plans

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◆ DOGE threatens US CMBS recovery
◆ Drill, baby, drill? Borrow, habibi, borrow
◆ Cracks appear in European credit market

Just when you thought it was safe to go back into the office... or rather back into commercial mortgage backed securities with offices as the collateral.

No sooner has the US CMBS revival begun than US president Donald Trump's administration threatens to ruin it. The Department of Government Efficiency (DOGE) spearheaded by Elon Musk is ripping up government office leases . We explain how that could hurt the CMBS market.

In the Middle East, a falling oil price has set investors and bankers wondering about how much more borrowers from the region — especially Saudi Arabia — will need from the bond market this year.

Cracks are also starting to appear in Europe's previously buoyant credit market. We look at where to find the fissures and how issuers can bridge them.

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◆ EU puts forward €800bn plan◆ Germany screeches into U-turn on debt brake ◆ Bund yield soars 40bp

The spectre of European countries needing to massively increase spending on defence has haunted the capital markets ever since it became clear that US president Donald Trump was really thinking of drastically weakening US military support to Europe.

It had already triggered a sell-off in European government bonds. But this week a vague expectation got some concrete numbers. Germany’s CDU, likely to lead the next government, has turned 180° and struck a deal with the SPD to make huge exceptions to the constitutional debt brake, including €500bn for infrastructure.

Germany’s 10 year bond yield made its biggest leap for decades on Wednesday, but then stabilised, suggesting the market now knows how big the issue is and can digest it.

Meanwhile the EU has also got on the front foot, announcing an €800bn ReArm Europe plan including €150bn of new joint borrowing.

We explore the results for the supranational, sovereign and agency bond market and for central and east European governments, where the security and fiscal concerns are keenest.

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◆ Rob Murray, the Defence, Security and Resilience Bank's creator, explains all
◆ Why US must be involved
◆ Three point strategy to augment defence spending

The idea of a new multilateral bank to help fund defence spending in Europe has shifted to the fore in recent weeks.

European leaders are understood to be discussing the idea this week and a plan for one could be announced soon.

Rob Murray, a former British army officer, is the person who first came up with an idea while working at Nato in 2018. He joined the podcast this week to discuss how it would work, the three things it would do that no other institution could do as well, and who would be part of it.

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◆ German and European spending needs rile SSA market
◆ GSE reform in the US, green reform in the EU
◆ Saudi Arabia leads Gulf diversification out of dollars

New German chancellor Friedrich Merz has a lot to tackle when he finally forms his coalition government. Much of it will involve spending more money, which has bond investors on alert for higher borrowing needs.

LBBW's chief economist Moritz Kraemer told a conference in Frankfurt this week that he believes there are five factors dogging the German economy. We discuss what they are, what Merz can do about them and how this is affecting the SSA bond market.

The reform of Freddie Mac and Fannie Mae is on the minds of those in the US securitization market. We delve into whether the pair could or should be put back into private hands after almost 17 years of government conservatorship.

The EU looks set to ease some recently imposed ESG regulations. We ask if the bloc risks relinquishing its leading position in green finance.

Finally, we look into a landmark deal from Saudi Arabia, which is part of a developing trend among Gulf issuers to diversify their bond issuance.

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◆ German poll to have far-reaching consequences for bond market
◆ UK water sector's capital markets tangle
◆ Corporate issuance picks up in emerging markets

Germany votes this weekend in a general election. Whatever the resulting coalition, fiscal matters will be top of their agenda. With the pressure on to raise defence spending but with the constraints of the country's debt brake to tackle, the strain is already showing in the bond market before a vote has been counted.

The UK water regulator has set out the conditions under which the 10 utilities it governs must operate. But this is a troubled sector of the UK economy and downgrades have been rife. We pick apart these companies' access to capital markets and how well they can raise the funding they need even as one teeters on the brink of default.

Meanwhile, corporate bond issuance in the emerging markets has been shrinking for years. But there are signs of a turnaround. We examine who is issuing and why.

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◆ Using the bond market to boost European security
◆ Africa nears sovereign debt stabiliser
◆ Sterling's ESG problem

With the new US government reasserting its belief that Europe needs to provide more of its own security this week, attention has turned once again to how to pay for it.

We discuss the various ideas in play, from setting up a new multilateral development bank to retooling existing SSA borrowers for the purpose, examining the pros and cons of each.

Meanwhile, the African Union may be about to bring to fruition a sovereign debt stability mechanism. Africa is the only continent without one and proponents believe it will ultimately bring down borrowing costs for issuers as well as offering an alternative source of ready capital in a crisis. We delve into how the entity will work.

Finally, we have been investigating why the UK bond market lags others when it comes to ESG labelled bonds and question whether the government and regulators should do more to encourage issuance.

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◆ Trump orders review of US involvement in multilateral development banks
◆ What's driving Reverse Yankee issuance?
◆ Deutsche Bank sparks new controversy in AT1 capital

Among many of the executive orders Donald Trump has signed since he became US president for the second time was one which ordered a review of the country's involvement in international organisations. That will include the multilateral development banks, in which it is often the biggest shareholder and which are big bond issuers.

We investigate how seriously the MDBs and the bond market should take the review as there is evidence of support for the sector in Trump's previous stint in the White House but also seemingly a revitalised sense of isolationsim and nationalism this time around.

US influence was prevalent in the European investment grade corporate bond market this week too. IBM was among a trio of US issuers pricing Reverse Yankee bonds. We look into what is driving the supply and what deals are to come.

Finally, we talked about whether Deutsche Bank's hint that it would not call two of its dollar additional tier one deals this year would rile investors at a time when the market for the product is red hot.

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◆ Why you got paid what you got paid

◆ Insider reveals what really goes on when bonuses are allocated

◆ HSBC winds down M&A and ECM

We lift the lid on how bonuses are allocated in investment banking from the top table to the lowliest analyst.

Our columnist, Craig Coben, who spent many years as a senior equities banker at Merrill Lynch and then Bank of America, has been through the bonus cycle many times and reveals just what goes into someone's number and the bank's true motivation and aims in paying out.

Meanwhile, HSBC shocked many this week by revealing it will shutter much of its M&A and equity capital markets business. Our Southpaw columnist, David Rothnie joins us as we discuss why the bank is doing this and whether it is a step in the right direction.

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◆ Riso and Ruhl on the development of the market's biggest new bond issuer
◆ Beyond NextGeneration EU: can the bloc fund defence?
◆ The campaign for sovereign-like borrower status

The European Union is the highest profile bond issuer in the market. In response to the pandemic, it ramped up its borrowing to fund member states' recovery from the disaster, going from raising around €500m a year to around €150bn almost overnight.

As an issuer, it dominates the public sector bond market and in this episode, GlobalCapital asked two of its most important figures, when it comes to its bond market activities, about what lies in store.

We talked about how the issuer's capital markets presence is developing, why it believes it should be classed as a sovereign-style issuer (and the progress it has made), and its possible future funding needs.

Our guests:

Stephanie Riso is the director general of DG Budget within the European Commission — the department responsible for raising and allocating the money the EU needs to implement policy, including from the bond market.

She took over the directorate in March 2023, joining from the cabinet of Commission president, Ursula von der Leyen, where she oversaw the creation of the €800bn NextGenerationEU programme that the EU's bond issues fund.

Siegfried Ruhl is hors classe advisor to DG Budget and a veteran of the public sector bond market. He initially took the post on a short secondment from the European Financial Stability and European Stability Mechanism — the two bond issuing bailout vehicles for EU member states founded during the sovereign debt crisis, which he helped set up.

Over four years later he is still at the heart of developing the EU's capabilities as a bond issuer — a task he is well versed in having not only been there since the start with the EFSF and ESM but also having helped to create Germany's Finanzagentur, the country's debt management office.

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◆ How the bond market will drive CCMM to provide more climate tech cash
◆ Multilateral development bank hybrid capital — and may have found its niche
◆ Covered bond market roars back to life but will it last?

The CIF Capital Markets Mechanism (CCMM) priced its first bond this week. The issuer is raising money so that the Climate Investment Funds, created in 2008 as a channel for rich countries to finance the green transition in developing states, can do more lending through its Clean Technology Fund. We look into the issuer, its deal and where it fits in the SSA bond market.

The first benchmark-sized publicly sold hybrid since the African Development Bank's deal from about a year ago also surfaced this week. The issuer was the African Finance Corporation. It is, like the AfDB, a multilateral development institution. But it has very different characteristics and these may give a clue as to where MDB hybrid capital deals will succeed in the future.

Finally, covered bond issuance has lagged behind the pace of other parts of the bond market this year but that all changed this week. We examine what the hold up was, why issuers have finally come to the market now, and what could derail the revival.

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◆ Gilts rocked on macro fears but sterling bond issuance booms
◆ Just how much of a basket case is the UK anyway?
◆ Debt-for-nature swaps blossom

This has lead to references in the press to the 2022 Gilt crisis, which the Conservative government caused with its notorious mini-budget of tax cuts to be fuelled through Gilt issuance. There have even been comparisons with 1976 when the UK took a loan from the IMF. We find out whether such comparisons are warranted.

In any case, what's bad for UK taxpayers appears to be fantastic for issuers and investors in the sterling bond market with record volumes of issuance being priced this week. We explain what is driving the market if the economic picture is really as bad as it is being painted to be.

We also take a look at the rise of the deb-for-nature swap — a financial package that allows distressed sovereigns to restructure debt and put money towards environmental causes.

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◆ The sheep and the goats in UK water
◆ How EM loses assets but gains deals
◆ US corporates lean to euro bonds

Investment bankers feel like they're on the verge of something good: a boom year in 2025 of mergers and acquisitions, by both corporate and private equity firms, and all the debt and equity financing that goes with it.

The US will be front and centre, all agree, as even the prospect of Donald Trump's presidency is quickening the nerves with hopes of deregulation and M&A being waved through without questions.

Even Trump's harsher moves like tariffs could stimulate deals as companies try to position themselves better.

It's a shoo-in that the US investment banks will do well in this climate, but which of the European banks are chasing them hardest, and managing to outrun their peers? We highlight the winners of 2024 and next year's contenders.

Also this week, Ofwat, the UK water regulator, produced its much-anticipated final determination of the financial parameters for water companies for the next five years. We explore what it does for the sector, especially its sickest member, Thames Water.

And the US Federal Reserve made a "hawkish cut" of interest rates this week. That is crushing the hopes of emerging market bond investors, which have been longing for three years for a strong rate cutting cycle to give them some money inflows at last.

But it could be good news for bond bankers in London, as US companies may turn to the euro and sterling markets for funding next year.

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◆ How to fund Europe
◆ What market experts think is going to happen next
◆ The EU to embark on biggest six-month funding spree

The European Union shapes up poorly compared to its rivals when it comes to growth and competitiveness. Former ECB president and Italian prime minister Mario Draghi believes the bloc needs €800bn of investment a year, but how to raise it? We reveal all.

That story is just one in our Review 2024 | Outlook 2025 special report. If you register by clicking through to this page, you will not only receive a free printed edition of the report but also 14 days of free access to GlobalCapital.

We also discuss what the most senior debt capital markets bankers think is going to happen in the year ahead, and where they see the threats and opportunities for their business. Clue: good news for those either looking to start out, or who have newly arrived in, their capital markets careers.

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◆ French government collapse scrambles bond market
◆ What next for French corporate, FIG, covered bond and public sector bond issuers?
◆ ECB Trials on distributed ledger technology: the verdict

The long-running saga of the peril of the French public purse took a new twist this week as the country's government collapsed over budget wrangling.

That turned the traditional order of relative value between French bond issuers on its head — corporates, including luxury good firm LVMH, now trade tighter than the sovereign.

We look into what comes next for French issuers from the sovereign and public sector agencies, to the country's banks and investment grade companies. Do investors really believe they are more likely to be paid back by LVMH than by the state?

We also revisit the recently concluded ECB Trials of distributed ledger technology in the bond market to see what progress was made and whether capital markets are any closer to going digital.

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◆ French bond issuers' tough time ahead as PM fights to get budget through
◆ Trump tough talk on tariffs' threat to emerging markets
◆ Investors give IPO sellers the silent treatment

There are barneys - quarrels to those unfamiliar with British slang - breaking out all over the place and capital markets are caught in the crossfire.

In France, prime minister Michel Barnier has a fight on his hands to get his budget passed. It could cost him his job. Meanwhile, French government bond yields are soaring alongside the country's deficit.

We look at the dilemma that poses for French issuers in the public sector and covered bond markets through the prism of a deal from one of them this week.

Where there's Trump, there's trouble. The US president-elect is threatening tariffs. This could spell disaster for emerging market issuers but, as we discover, panic is yet to set in. We explain why.

Our final fight is in the equity capital markets where investors are giving sellers no clues as to their interest in new listings. That makes every deal more risky. We investigate how to break the impasse.

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◆ The challenge for SSA issuers next year
◆ German banks and the commercial property millstone
◆ Hybrid hot streak explained

SSA bonds in euros have widened against swaps by quite some way in recent months. That will present a big challenge for the asset class's smaller issuers next year. We explain how the market will find a new clearing level.

German banks - two in particular - have suffered from investor fears over exposure to commercial property. Those fears have abated over 2024 but this week there was a deal that suggested a mild degree of terror lingers. We investigate.

Finally, there has been a spate of corporate hybrid debt issuance lately. We find out why and whether there is more to come.

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◆ Donald Trump’s threat to ESG finance in the US
◆ Why ‘woke capitalism’ won’t be put to bed
◆ UK auto ABS faces up to compensation crisis

One of the biggest areas of conflict in US politics over the next four years — and indeed, over the past four — will be over environmental, social and governance matters. Donal Trump’s administration will likely be no fan of what its supporters sometimes call “woke capitalism”.

But whether this spells disaster for environment and for ESG capital markets remains to be seen. Although the Republicans have a firm grip on the federal government, a deep dive into ESG in the US reveals that they are unlikely to be able to have everything their own way.

Meanwhile, a ruling that may entitle UK car buyers to billions of pounds worth of compensation from the banks and other firms that financed their wheels could have negative consequences for the auto ABS market. We take the scenic route in examining the situation.

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◆ Trump triumphs, Scholz slumps, rates roil
◆ Credit issuers off to the races
◆ Rates issuers contend with unprecedented Bund-swap inversion

The underlying movements between benchmark rates and bond yields are rocking the capital markets. Why? Well, this week the blame could be laid squarely at the door of politics.

Donald Trump's resounding victory in the US presidential race means the world's economic currents are about to shift, turbo charging some areas and threatening others. Meanwhile, the collapse of Germany's government helped to push Bund yields above euro swap rates for the first time ever.

Both these things have driven big changes in the value of one asset class in the bond market against another, affecting how much investors want to buy them. We explain the changes underway in SSA, covered, FIG and corporate bonds and what they mean for issuers in the weeks and months ahead.

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◆ What Trump or Harris mean for EM sovereign issuers
◆ The outlook for UK capital markets after the Budget
◆ Creditors turn on each other in Thames Water saga

In a year of elections, now comes the big one — the US votes on November 5 for either Kamala Harris or Donald Trump as its next president. Whoever wins, and whichever of the Democrats or Republicans ends up controlling Congress, the effect of the results will be felt around the world, including in its capital markets.

We focus on one group of borrowers for whom the result can make or break their bond market access: emerging market sovereigns. We discuss the effect a Trump or Harris presidency will likely have on their funding access and why.

The UK's new Labour government revealed its first Budget this week. We examine how the event affected the Gilt market and look more broadly at the outlook for equities, M&A and investment banking in the country.

Finally, an update on the latest twist in Thames Water's debt saga as different groups of creditors launched alternative and competing proposals to lend the company more money.

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◆ New CEO revamps HSBC to be leaner and meaner
◆ What markets think of idea to make UK water sector non-profit
◆ The swap spread dynamic hammering SSA bonds

New HSBC boss Georges Elhedery is restructuring the bank. It's what new CEOs do; and it has certainly been tried at HSBC before, with mixed results. But plenty of people think this time could be different. We explain why Elhedery's plan could work and what the motivations are behind it.

A corporate restructuring idea that received a less enthusiastic reception was one to make the UK's troubled water companies — privately owned — operate as non-profits. The sector is in crisis and requires huge investment. The thought is that money previously funnelled into private hands by way of dividends should be used to pay for it. We talk through the ramifications and the reaction in capital markets.

Finally, we look into the accelerating tightening of the spread between Bund yields and interest rate swaps in euros and why this could cause a headache for supranational and agency bond issuers.

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◆ Iconic NYC spot powers CMBS revival
◆ Gilt market braces for Labour Budget
◆ Banks plan bonds for November undaunted by US election

The US CMBS market lapped up its biggest deal of the year this week, backed by loans on New York's famous Rockefeller Center. We look into what the deal tells us about the revival of offices and the pipeline for the CMBS market, which has been troubled for years by changing working practices and high interest rates.

In the UK, the Gilt market is gearing up for the new government's first Budget, due at the end of the month. The government says there is a £20bn hole in the public finances and that it wants to invest. But how much extra Gilt issuance can the market stand? We find out.

Finally, the big risk event of the year for capital markets — the US election on November 5 — does not appear to be causing quite as much peril as it did earlier in the year, to the extent that Europe's banks are already planning to bring deals in its immediate aftermath across the capital stack.

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◆ T+1 is coming but is it worth the hassle?
◆ Despite appearances, bank bond issuers are not getting it all their own way
◆ Where the EU slots into the reshuffled SSA pack

The UK has launched a draft framework for settling securities trades a day after deals are done — T+1 settlement. The EU is expected to follow, with both markets aiming to catch-up the US, which cut settlement time down to one day in May. But not everyone is thrilled at the prospect as they face up to the burden of paying for everything required to make it happen.

In the FIG market, banks seemingly have the upper hand over investors but there was plenty this week to suggest that they cannot simply do whatever funding they want at a price of their choosing. We look at the treacherous undercurrents at work.

Finally, we revisit a story from last week's show where we explored how the landscape of the European government bond market is changing. Well, no story about the SSA market is complete without considering where the EU fits in. In the week in which it executed another blockbuster syndication, we investigate where the jumbo-sized issuer sits — something it has been urging the market to consider for a long time, itself.

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◆ The new pecking order in eurozone government bonds ◆ Can the bond market build Britain? ◆ UniCredit v Commerzbank: after Orcel's gambit, the Orlopp defence

Everything you thought you knew about eurozone government bonds is wrong. Well, maybe not quite everything but certainly big shifts have taken place in how the market views the creditworthiness of different sovereigns with Spain, for example, now trading tighter than France for the first time in 16 years. We look at the shifting dynamics and what is driving them.

The UK's new Labour government, meanwhile, wants to build more houses. The country's housing associations will have a key role to play in that but can they fund everything they need to for that in the bond market? We look into their options.

Finally, we bring an update on the latest twist in UniCredit's attempt to take Commerzbank over as the latter's new CEO builds her defence.

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◆ Emerging market and financial institution bonds on fire after Fed cut ◆ Huge demand spurs massive issuance ◆ But signs of weakness appear in corporates and public sector bonds

Markets were unsure what they wanted from the Federal Reserve, but the 50bp rate cut it doled out last week turned out to be just the ticket. In credit markets, all cares and qualms have been forgotten, in one wild party of risk-taking and risk-issuing.

Emerging market issuers of all classes, from Saudi Aramco and Abu Dhabi wealth fund ADQ to Agrobank of Uzbekistan have been piling greedily into the market, making up for two lean years of minimal issuance. Deals are flying, making even these usually slow and wary issuers scramble to put issues together.

If you thought banks had done masses of funding and didn’t need any more, think again —there is an additional tier one capital festival going on in the US, with half this year’s issuance having come since August. Santander, which trumpeted having finished its funding for the year in June, found space for another €3bn, though it promises not to return to euros again till next year.

It’s a strong market for corporate bonds, too, but banks have noticed a big rise in investors getting price-sensitive and dropping out of orderbooks. Deals are still going well, but it’s an early sign of fatigue and oversupply.

And the more cerebral public sector bond market is fretting. Euro deals just aren’t going well and spreads have widened markedly. There is still the dollar market, but something isn’t right in Europe. Is it France?

PLUS a brief interview with Stefan Wintels, CEO of KfW.

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◆ The new rate cycle begins at last ◆ Can Deutsche Bank avoid being overtaken by UniCredit? ◆ Carmakers in trouble ◆ The DLT help no one wanted

UniCredit’s stealth raid to grab 9% of Commerzbank last week threatens Deutsche Bank’s historic primacy in German banking. What can Deutsche CEO Christian Sewing do about it? We discuss three courses of action — one clearly better than the others.

That’s not the only trouble in Germany: BMW is having to make a €1bn product recall and Volkswagen might have to close factories in Germany.

This week two other companies in the automotive sector, Daimler Truck and Renault’s RCI Banque, came to the bond market.

We look at how the market treats borrowers when something is amiss in their sector.

But the reason this week will go down in history is the first Federal Reserve rate cut since the onset of Covid — the true beginning of the new easing cycle. Markets have known it was coming — now the ride has begun, with a 50bp move that has leapfrogged the European Central Bank and Bank of England. We find out how public sector borrowers are handling the new environment.

And there is a dispatch from the blockchain bond market. ‘I’m from the government and I’m here to help,’ said the European Union last year — but it hasn’t.

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◆ Corporate bond issuers swarm on new measure of success to chagrin of their banks
◆ An utter riot at one end of the credit spectrum for bank debt...
◆ ... while investors take their sweet time at the other end

Issuers in the European corporate bond market are beginning to fixate on the amount they are able to move pricing in their favour when they bring a new deal to market as a key marker of the trade's success.

But just how good an indicator is that? Certainly the banks that connect these issuers with investors by running these deals don't think much of it. We look at the pros and cons of this latest fad.

We also took a look at the bond market landscape for financial institutions. Banks bringing their most expensive and riskiest deals to market — additional tier one capital — found a red hot market this week. But at the other end of the scale, there is a sense that ultra-safe covered bonds are proving a harder sell. We examine the market dynamics.

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◆ Slovenia debut emblematic of issuers tapping Japanese market despite carry trade chaos
◆ Being all things to all investors in the covered bond market
◆ Corporate issuers keep it short and sweet

This week we take an in-depth look at the techniques bond issuers are using in the race to get as much funding done before the US election. Benchmark issuance resumed early this year after the summer lull and it is clear that issuers are keen to get their bonds sold as quickly as possible. We focussed on three tactics.

One was investor diversification. Slovenia made its debut in the Samurai market this week but it is not alone among what have traditionally been considered emerging market sovereigns in doing so. Mexico was a recent issuer and there are plenty of countries in the pipeline. We examine the attractions and difficulties of the Japanese market, especially in light of the recent market volatility caused by the Bank of Japan putting up rates and the effect that had on the so-called yen carry trade.

We also looked into the diminishing demand for long-dated debt. Bonds with long tenors were a hot ticket all year but demand has dwindled of late. We find out why through the lens of the corporate bond market and what issuers are doing to adjust.

In the covered bond market a third tactic was in play: appealing to as many investors at possible at once. TD priced a slug of covered bond issuance in euros this week that you would more commonly find in the dollar market for unsecured debt. We discuss what the Canadian issuer was trying to achieve, whether it succeeded and if the technique will catch on.

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◆ Why benchmark issuance has resumed earlier than usual
◆ What lies ahead for capital markets
◆ African issuers switch out of loans to bonds

Unpredictable weather is increasingly a feature of modern times. Indeed, as GlobalCapital recorded this week's show, summer appeared to have ended abruptly in its corner of the UK, with distinctly autumnal weather dampening both the pavements and the mood despite there still being a chunk of August to go.

The bond market was also looking distinctly unseasonal this week too, as issuers across asset classes resumed public benchmark bond issuance early compared to most years. We look at what got done, the health of the market and why issuers have gone early.

We also discuss what African borrowers are planning as they switch from loan funding to bond markets and what is driving that behaviour. Plus the latest from defaulted Ethiopia's negotiations with creditors.

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Banks have started to reveal how they will restructure the pay of front office staff following the removal of the bonus cap in the UK. We investigate who will benefit from the new rules (spoiler alert: it's probably the banks).

Recent market volatility has thrown up opportunities for corporate issuers. Firstly, we discuss why we are about to see more US companies issuing bonds in euros.

Then we travel to the US convertible bond market where we delve into a new debt package for the airline JetBlue, which resulted in a plunging share price and a credit rating downgrade.

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◆ Issuers and investors look for clues after violent price swings
◆ Which borrowers will lead autumn deal spree
◆ How pricing has shifted in primary market

There are moments that change what is to come. When poor US employment data and corporate earnings, and a rise in Japanese interest rates last week sent the markets into a tailspin at the start of this one, it changed how issuers will approach the capital markets when issuance volumes start to ramp up later this month.

And this year, the autumn issuance window is particularly important with the fractious US election threatening to make October and November an ill advised time to be in the capital markets with lots of funding to do.

We discuss how this week's turbulence has changed the picture for borrowers making plans for the rest of the year in terms of timing and pricing of deals.

As one of the characters in Alan Bennett's play The History Boys notes, there are times when events force people down a different course — "and here history rattled over the points", he says. Was this week one where the capital markets headed off down a different track to the one they thought they were on? We find out.

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◆ First eurozone government sells bond on distributed ledger
◆ The rate cutting wheel turns faster

Making innovations a reality is partly about who does them, so the first eurozone sovereign issuer selling a bond on a blockchain is a milestone that takes the market up a notch in credibility.

GlobalCapital’s reporters discuss their findings after speaking to Slovenia’s treasury this week about why it wanted to take the lead among peers by trialling this new technology with a €30m four month bond. Other sovereign borrowers told us they were content ― for now ― to watch from the sidelines.

Slovenia chose the Banque de France’s solution, wanting a system in which both legs of the trade were fully tokenised.

Meanwhile, conventional bond markets have been gripped by central bank fever again, as the Bank of England joined the European Central Bank on the rate cutting path. Although the Federal Reserve held rates, it was seen as a dovish hold. That leaves the public sector bond market raring to get started on issuing ― but will it find suitable windows?

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◆ Ukraine restructures $20bn of bonds
◆ Excitement in digital bonds
◆ Is UK water going down the plughole?

Swiftly after Ukraine was invaded by Russia, it agreed a two year suspension of debt service with bond investors. That expires on August 1. While many thought Ukraine would negotiate an extension, it has chosen instead to do a full restructuring, issuing new bonds in exchange for the old. We explore why, and whether this was a wise move.

We are reaching the mid-point of the European Central Bank’s trials of distributed ledger technology for financial markets, including bonds ― a festival of experimentation in which banks, clearing houses, central banks and tech firms are trying different ways to get bond deals on to blockchains. There are strong hints we are about to get the first DLT bond from a eurozone sovereign.

Supplying the most basic commodity, water, as a regulated monopoly sounds fairly straightforward, and not likely to generate a lot of credit risk. But Thames Water was downgraded to junk by Moody’s this week. If S&P follows suit, the once unthinkable will have happened: a UK water company breaching its licence due to credit weakness. How will the capital markets react?

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◆ UN circles banks on circular economy
◆ Topping out on Turkey
◆ CLOs: summer recess or summer resets?

ESG capital markets are undergoing another revolution. The UN is beckoning banks to police their corporate clients' transition to being part of the circular economy. But what is the circular economy and are other shapes available? How can banks put pressure on businesses to better manage resources? We explain all.

Turkey's bond issuers have absolutely obliterated the record for volume of bond issuance from the country this year. We discuss what led to this renaissance and what will affect supply and demand for Turkish bonds for the rest of the year.

The European CLO market is also running at a hectic place, with deal resets galore set to ruin everyone's summer holiday plans. We discover the interesting market dynamics at play that are driving such a busy spell.

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◆ UN circles banks on circular economy
◆ Topping out on Turkey
◆ CLOs: summer recess or summer resets?

ESG capital markets are undergoing another revolution. The UN is beckoning banks to police their corporate clients' transition to being part of the circular economy. But what is the circular economy and are other shapes available? How can banks put pressure on businesses to better manage resources? We explain all.

Turkey's bond issuers have absolutely obliterated the record for volume of bond issuance from the country this year. We discuss what led to this renaissance and what will affect supply and demand for Turkish bonds for the rest of the year.

The European CLO market is also running at a hectic place, with deal resets galore set to ruin everyone's summer holiday plans. We discover the interesting market dynamics at play that are driving such a busy spell.

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◆ Political shift threatens Paris's growing status
◆ The liberation of securitization in Europe as Macron weakened
◆ Bond issuance returns, mostly

As new parliaments form after the EU, UK and in particular, French elections, we uncover how, despite each poll resulting in the widely expected outcome, capital markets might never be the same again.

Paris's remarkable rise as a capital markets hub at London's expense after Brexit has been staggering. But will an emboldened left wing in the French parliament make life tougher for the tens of thousands of market participants — and their employers — that have lately made the French capital their home?

French president Emmanuel Macron, not only championed Paris as a financial centre but has also been a driving force behind the push for relaxing EU securitization regulation. We look into whether his weakened mandate spells doom for that regulatory push. We also examine who will be picking up the baton in the EU and UK political arenas.

Finally, it was no surprise to see issuance come roaring back this week once the polls were done. But we discovered that not every issuer was able to get the funding it wanted.

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◆ UK ousts Tories from power...
◆ ... setting up final round of French elections as only bar to primary market revival
◆ EM debt restructurings: balancing what creditors demand with what voters need

This week, we looked once again at the intersection of politics and capital markets. The Labour Party, as predicted, won the UK general election by a landslide, with departing prime minister Rishi Sunak on his way to Buckingham Palace to resign as prime minister as we recorded.

But what does the outcome mean for debt markets? Well, it may not matter as much as what is set to happen in France over the weekend, which has the final round of parliamentary elections. We discuss the likely outcomes and ramifications of those and how issuers will approach the bond market in their aftermath next week.

Meanwhile, although further news of progress with emerging market sovereign debt restructurings might be encouraging for the asset class, we note that the recent violent protests in Kenya underscore the difficulty in balancing the demands of international creditors with the needs of citizens for governments in debt distress.

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◆ Natixis’s sometimes requited love affair with elite M&A bankers ◆ What the French election could to ESG, and to the bank bond market

When a posse of high-powered Paris dealmakers threatened to walk out of Natixis because they were being treated like “just another employee”, rivals said ‘I told you so’. They were sure Natixis’s unique way of doing M&A banking was falling apart.

Nine months later, not so. France’s fourth largest investment bank, owned by the mutual savings bank group BPCE, is sticking to its plan ― and doubling down. Natixis’s ploy is, rather than trying to build its own M&A department, buying stakes in a growing network of independent boutiques. As investment banking correspondent David Rothnie explains, the key to managing this potentially unruly throng is flexibility.

Before that, we look with corporate debt editor Mike Turner at how investors are pouring money into environmental, social and governance bond funds this year, and how that is playing out for issuers.

And with the first round of the French parliamentary election coming this weekend, bank finance editor Atanas Dinov explores what the outcome could do to French access to the capital markets, especially for banks.

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◆ Banks need a bond market leader, just not a French one
◆ From Golden Goose to lame duck
◆ CMBS problems, rise of solar ABS

Europe's banks have been unwilling or unable to issue bonds since French president Emmanuel Macron sent the markets into a tailspin a couple of weeks ago by calling parliamentary elections. We explain why the uncertainty the election is causing is so bad for so many bond issuers, and also which banks can restart issuance in their market.

We also look at a triumphant return to sustainability-linked bond issuance for Enel, the Italian power company which created the structure. But it wasn't all good news from the country this week. Golden Goose, the maker of expensive trainers, pulled it IPO. We examine why.

In securitization, we looked into problems in the commercial real estate sector that are hitting investors but rather more cheerily, we find out why solar ABS might be coming to Europe.

◆ Politics panic slaps SSAs, FIG but what of corporate bonds?
◆ EU denied its wish
◆ Introducing Primary Market Monitor

Well, you can't say we didn't warn you. On last week's show we talked about European elections and the likelihood of volatility following the ECB's historic rate cut.

Et voila!

French president Emmanuel Macron's decision to call snap parliamentary elections in the wake of far-right successes in the EU equivalent has caused havoc in bond markets this week. SSA and FIG issuers abandoned deal plans. We discuss which bits of the market are still working, just how bad this bout of volatility is compared to recent times and what new issuance prospects are for the immediate future.

The EU didn't have a vintage week as a borrower either. It priced a successful syndication, though as we discover, it lacked the glossy finish of other deals. Then it was denied access to MSCI's government bond indices. We reveal why this matters so much to the borrower, and the way forward.

Finally, GlobalCapital is about to launch a new data product: Primary Market Monitor. We tell you what it is, what it does and how you can get an early look at it.

◆ Private credit, regulation and cuddly toys at Global ABS in Barcelona
◆ What the European parliamentary elections mean for EU bonds and Capital Marekts Union
◆ Will volatility follow the ECB's historic rate cut?

The incursion of private credit into the securitization market, and how securitizations are regulated, were two of the big topics at Europe's biggest industry conference this week. We were joined by our colleagues from the Another Fine Mezz podcast to discuss all of that, the best freebies at the event and the perils of live podcasting.

Meanwhile, the ECB made its first cut to interest rates in five years on Wednesday. It was well expected but now uncertainty is back as capital markets puzzle over where next for rates.

Finally, June's EU parliamentary elections will have an influence not only on securitization regulations but also the future of the EU as a bond issuer and the path to Capital Markets Union. We discuss the likely outcomes.

◆ Which banks sell in run-up to rate cuts
◆ South Africa election and the bond market
◆ Saudi Arabia leaves peers behind

Rates volatility returned to the European FIG market this week. We ask what credits investors are buying ahead of a key ECB monetary policy meeting, when it is expected to cut interest rates, and why.

South Africa's election this week was, at the time of writing, likely to result in the African National Congress losing its exclusive grip on power for the first time in 30 years. We discuss what that and the likely outcomes mean for the bond market.

As Saudi Arabia returned to the debt markets with another blockbuster sukuk, we examine just where the issuer sits in the debt capital markets and how it manages to keep investors keen when it has to raise so much compared to its peers.

◆ Capital Markets Union: gauffre it
◆ The EMEA investment banking riddle
◆ Why EM bond investors keep buying deals that end up under water

Mairead McGuinness, the European Commissioner for financial services, financial stability and Capital Markets Union urged those attending the International Capital Markets Association's conference in Brussels this week to get on with building CMU. But were they listening? We cut through the waffle to discuss the path to a common capital market .

Meanwhile, investment banks are reassessing how they make money from M&A and advisory in the EMEA region. We reveal the new approaches to client coverage and staff pay that are emerging.

Finally, a plethora of borrowers from the emerging markets have been bringing deals at ever tighter spreads and paying very little in new issue premiums. But as we discover, these deals are not performing in secondary trading. We investigate why investors keep showing up for the paper.

◆ A pivotal moment for digital capital markets
◆ Who really benefits from bonds on the blockchain?
◆ FIG M&A in Europe

There is no shortage of evangelists for digital capital markets. But adoption of bonds on the blockchain has been slow, not least because it hasn't always been obvious what problem the tech is solving, or how it can be widely implemented. This week, however, the ECB took a big step forward by launching trials of distributed ledger technology for bonds.

We discuss what the ECB hopes to achieve with this initiative. We also debate whether it will change the face of finance or we know it, will fizzle out into nothing, or something in between. One thing is for sure: everything is to play for at this critical moment in the digitalisation of the bond market.

We also took a keen interest in French president Emmanuel Macron's opinion this week that there is a need for consolidation among the EU's banks. Is big bank M&A on the agenda, and if so which firms? We also look into the likelihood of it happening as well as the pitfalls and benefits.

◆ Etihad to lead fleet of airline listings as IPO market and aviation sector blossom
◆ Air Baltic's historic coupon
◆ Open season for bank AT1s

An airline IPOs are a rare bird. In the last nine years, there have been three. The industry has rebounded from Covid, however, as UAE carrier Etihad's results proved this week and now it and at least eight others are looking to list on stock exchanges this year, or next. We look at what is driving them to the equity market and what reception they will likely find when they get there.

One of those airlines is Air Baltic. It was in the bond market this week raising €340m of five year debt, callable after two, at a cost of a whopping 14.5%. We look into the airline's capital markets strategy.

Meanwhile, banks piled into the additional tier one capital market this week. We examine how they managed to cram so much issuance into such a small window at such tight pricing.

◆ Sustainability-linked bonds lose appeal...
◆ ... as do the loan versions, come to think of it
◆ The favourites to take over from Quinn at HSBC

When Enel missed a KPI on its sustainability-linked bonds, it could have marked a moment of maturation for a youthful product but issuance volumes are plummeting.

Meanwhile, the international banks that lend to Turkey's financial institutions seem to prefer to make green loans rather than the sustainability-linked versions they made previously.

We ask what is going on with sustainability-linked products — does all of this signify the last rites for an asset class that was supposedly so well-suited to funding the green transition?

Meanwhile, Noel Quinn caused a surprise this week by announcing his plans to retire from HSBC, where he is chief executive. We look at who might replace him, and we think we've identified a clear favourite.

◆ The 'marginal madate': it seemed like a good idea at the time
◆ GlobalCapital's new columnist, Craig Coben
◆ World Bank boosts lending capacity

What do you do when that mandate you accepted in a quiet market to keep busy is still lurking about, taking up time and energy, when the market has picked up and juicier deals are to be done?

Is extending balance sheet to clients as a second tier firm when the top tier won't anything other than an exercise in futility in the long term?

GlobalCapital's new columnist and capital markets veteran Craig Coben joined us to discuss these very matters and more.

Meanwhile, we have an update on the fast developing situation with the capital of multilateral development banks, the not so secret weapon in their campaign to increase their lending to the developing world.

Also, hear from our sponsors, KfW, about their latest advance into blockchain-based digital bonds.

◆ Supranationals speak on callable capital
◆ Bank funding: pricing reset
◆ The demise of the cornerstone investor

As the great and the good of the development finance world gathered in Washington, DC for the World Bank/IMF Spring Meetings, multilateral development banks published details about their callable capital, the next vital step along the way to powering up their lending to solve some of the planet's most urgent problems. We digest what they said and why it matters.

In the FIG bond market, issuers decided to postpone new issues as rates volatility gripped the market. We figure out when they will be back and how much extra they will have to pay for the funding.

Finally, equity capital market experts think the IPO revival is strong enough to do away with cornerstone investors. And what do the cornerstones think of that? Listen in to find out (spoiler alert: they're not exactly tearing up the paving stones over it).

◆ Why everyone from nuns to pro-coal US state treasurers are giving banks stick over ESG
◆ El Salvador's punchy new debt structure
◆ Appetite for duration in covered bonds

West Virginia: almost heaven unless you're on state treasurer Riley Moore's list of banks the state won't do business with over fossil fuel financing. But unlike most ESG-related exclusions, in this case opprobrium is reserved for financial institutions deemed to be anti fossil fuel.

Bank of Montreal has dodged making the list in a week where four others were added. But the pressure on banks to behave a certain way over ESG is mounting on both sides with some nuns in the US taking Citi to task over what they see as exploitation of indigenous people.

We look into what this means for banks picking a treacherous route to building their ESG credentials while trying to make money serving traditional clients. We also examine what investors in their bonds think.

Investors had another tricky consideration to make this week as El Salvador issued a funky new structure as it looks to beat its debt distress. We examine the new bonds and what the market reaction to them.

Finally, we discuss the growing appetite for long dated covered bonds.

◆ Do investors want unified capital markets coverage?
◆ Corporates fear democracy
◆ Why are FRNs trending?
◆ Second lien mortgages in arrears ― yes please

Banks’ urge to cut costs in debt capital markets, especially syndicate desks, is prompting some to call for the ‘global capital markets’ model: one team for equity and all kinds of debt.

They argue this could heal banks’ disjointed thinking and allay investors’ frustration that they have to say the same thing to five different bankers at every firm. But there are plenty of sceptics...

Few in the corporate bond market expected its rally to last into this year, still less the second quarter. But here we are and it’s still running. A motley bunch crammed into the market this week and found a great reception. As Mike Turner explains, they’re partly packing the funding in to avoid this year’s great big risk event: the US election.

Floating rate notes are the natural product for banks to issue, but normally they don’t much, because most investors prefer fixed rate bonds. So why are investors gagging to buy floaters now, just when everyone agrees interest rates are about to fall? Sarah Ainsworth goes through the ins and outs.

Second lien mortgages are the kind of — shall we say 'challenging' — collateral familiar from the US securitization market, but as George Smith and Victoria Thiele highlight, the UK has produced four deals in the past five months. The latest, from Equifinance, had some pushback in the market, but investors were only joshing and bought it in the end. We ask if lower ranked mortgages are the hot new asset class.

In the second part of GlobalCapital’s exploration of how bond syndicate desks are changing, after a swathe of the discipline’s senior bankers have been made redundant, we discuss the syndicate job itself.

Technology and market transparency have stripped away some of the grunt work, but also made knowledge easier to come by. Are banks thinking they don’t need so much experience on desks?

Bankers admit pricing bonds has often become more routine. But when markets get difficult, or situations do, as with Equinix’s recent pulled deal, you need experience.

We also talk to Ana Fati and Mike Turner about the latest plunge down for Thames Water after shareholders refused to put in much needed equity. What are bond investors and lenders thinking about the UK water sector?

And it’s been a huge week for African bond markets, with Zambia finally getting its official creditors and bondholders to agree to a restructuring. This one is meant to be tougher to bondholders, but if Zambia does well economically, it will have to pay extra. George Collard explores whether that is a good thing, or will prove a burden.

◆ MUFG's Del Canto and SG's Menzies on what comes next for capital markets
◆ The juniorisation of syndicate desks
◆ Two deals pulled despite fantastic markets

It was only a few months ago that GlobalCapital asked more than 50 of the bond markets' most senior bankers where they thought the primary markets were headed in 2024 for our Review 2023|Outlook 2024special report. This week, two of them joined us on the podcast to see which predictions had come true and what comes next for issuers and investors after what has been a stellar start to the year for bonds.

Fabianna Del Canto is MUFG's co-head of capital markets in the EMEA region. She has worked in syndication and origination for over 20 years and jointly runs the Japanese firm's business in the investment grade, structured, leveraged and emerging markets.

Andrew Menzies is Societe Generale's global head of debt capital markets. He has been at the French firm since 2003, working with clients across the Americas — during a stint in New York as the bank's head of DCM for the continent — the UK and Ireland, the Netherlands and Scandinavia.

But as good as markets have been for issuers this year, there were two stark reminders that access to bond funding can never be taken for granted. Two issuers hooked their deals right in the middle of book building — Equinix and Raiffeisen Bank International. We examine both cases to see what went wrong.

We also look into why some of the most senior syndicate bankers in the Street are leaving their jobs and being replaced by more junior staff.

◆ The UK is about to embark upon a new, higher funding remit with a key part of its investor base dwindling
◆ Why the FIG bond market is so strong and why it will stay that way
◆ If investors are still leaving EM bond funds, who is buying record amounts of issuance?

The UK plans to sell £28bn more Gilts from April — the start of its financial year — than last year, at £265.3bn. As a bond issuer, it has been able to rely on what some have called a captive investor base, in particular UK pension funds that cannot buy long-dated sterling assets in such volumes from anywhere else. But their demand is falling. We explain why, and how the UK's Debt Management Office will adapt.

Whatever the future holds, it did not stop the UK from achieving a record order book for a syndication this week. And credit markets are going great guns too. We look at what is driving demand for bank bonds in euros an spot an opportunity for issuers that may be able to do something a little different.

We also investigate the riddle of emerging market bonds — if dedicated funds keep suffering net outflows, then who is behind the record volumes and deal sizes? And what will it take for net inflows to return to the asset class?

You can subscribe to this podcast by hitting any of the buttons below, or by following us on YouTube, using this link.

◆ Basel gets tough on banks gaming ratio regs
◆ Fast fashion ESG dilemma for London
◆ What drove Israel's record dollar deal

The Basel Committee that supervises banks has unearthed evidence that some of the most important banks are window dressing their accounts to meet regulatory requirements. We discuss the illusions being created and what the supervisors plan to do about it.

In the equity markets, London has been soul searching for some time over how to restore its former glory as a listings venue. Chasing the IPO of fast fashion giant Shein is one possibility but just how helpful will hosting a deal for a company mired in ESG concerns be for the bourse's reputation? We find out.

Finally, Israel took to the bond market this week to meet a big chunk of its funding requirement, much elevated by its war with Hamas. We talk about the deal, how it went and raise the question of whether the bonds of a country engaged in a conflict that has generated such a great deal of controversy fits with an investment industry that spends so much time talking about its ESG priorities.

You can subscribe to this podcast by hitting any of the button below, or by following us on YouTube, using this link.

◆ The consequences of sovereign retail bonds
◆ Asset managers alter covered bond landscape
◆ Ramadan drives Gulf deal surge
◆ One word: plastics

As the UK took a step towards including greater retail investor participation in its Gilt auctions, we looked at recent developments among it peers in doing the same and assess the pros and cons of democratising debt markets.

Asset managers are pouring into covered bonds, swelling order books. Is that leading to some deals being mispriced? We find out.

Meanwhile, there is a surge in issuance from borrowers in the Gulf underway as they look to issue before Ramadan begins later in March. We look into who is selling what and how well they're doing it.

Finally, we examine a new sustainable finance initiative to tackle the plethora of plastics clogging up the environment.

You can subscribe to this podcast by hitting any of the button below, or by following us on YouTube, using this link.

◆ Markets plead for regs pause
◆ Barclays' new strategy
◆ Middle East ECM to take it up a gear

On the one hand, the EU wants a Capital Markets Union that will make the bloc a single pool for financing to compete with the US or China. On the other its lust for rules has created an incoherent mess of red tape, choking off any chance of CMU happening.

Now, trade bodies are pleading with the European Commission to pause and tidy up. We look into what they're asking for.

Barclays, meanwhile, revealed the latest plan to turbo charge its investment bank, which eats up too much capital for the amount of money it makes. We look into the detail of the new plan.

Finally, Middle East equity capital markets have bustled in recent years, while those in the rest of the CEEMEA region have stagnated. We look ahead to the swarm of deals due in the region this year.

You can subscribe to this podcast by hitting any of the button below, or by following us on YouTube, using this link.

◆ Kenya deal ducks default but two more countries in crosshairs
◆ Transition finance after historic Japanese bond sale
◆ How the IPO revival is a boon for the loan market

Kenya may have averted fears of default by raising fresh money this week but already investors are working their way down the list of African sovereigns with troubling debt piles. Tunisia and Egypt are next on their list, leading us to look at each country's problems and how they can avoid default.

Japan has executed its first auction of government bonds to finance the country's transition to a more sustainable economy. We look into the deal to see how successful it was and debate whether Japan has set a template for other countries to follow that improves on bog standard green bonds.

Finally, we look at how the loan market could see a pick-up in activity thanks to the revival of initial public offerings in Europe.

You can subscribe to this podcast on all the major platforms, or by following us on YouTube, using this link.

◆ Primary market for banks flying but will property burst the bubble?
◆ Japan to debut transition bond as SLLs fall out of favour
◆ Kenya back in bond market

The bond market for bank issuers goes from strength to strength. Any trade seems possible in any format and new issue premiums are rarer than hen's teeth. But is a sharp dose of reality coming in the form of exposure to bad real estate loans?

We also discuss the demise of the sustainability-linked loan and whether the product has a future alongside such ESG finance innovations as Japan's debut transition bonds, which we pick apart to see if they could provide a way for more sovereigns to fund innovation in sustainability.

Finally, we look into Kenya's bond market return. It wasn't that long ago — two weeks in fact — that market participants said the country was a default candidate and had no bond market access. Now it is planning to price a new issue. We explain what's going on.

◆ The first of a new asset class in SSA debt
◆ Full inspection of AfDB's landmark deal
◆ A power shift in the European CLO market

Years in the making, the first publicly sold hybrid deal from a multilateral development bank arrived this week. The African Development Bank's latest instrument heralds not just the dawn of a new product in the bond market but, as other MDBs bring their own deals, will lead to an increase in supranational bond issuance overall and, most importantly, more development dollars for lower income countries.

We take a look this week at how this deal came to fruition, who bought it and why, and what will happen next as this nascent asset class takes its first steps.

Meanwhile, Victoria Thiele, co-host of our sister podcast dedicated to securitization, calledAnother Fine Mezz, helped us examine how growing demand for equity tranches in European CLOs means the buyers of their triple-A tranches no longer have it all their own way.

◆ Are lawsuits about funding polluters the next big risk for banks?
◆ Sub-Saharan Africa issuance returns...
◆ ... but will any follow Ivory Coast's lead?

The Dutch branch of Friends of the Earth is suing ING over its roll in financing pollution. It is the latest in what may become a wild spread of lawsuits brought against banks — and governments and corporates, for that matter — as environmental bodies seek to enforce tougher timelines for transition.

We look at what this means in terms of being a big risk for the banking sector and analyse how it might develop.

Meanwhile, Ivory Coast issued a bond this week, to much acclaim. It was the first African sovereign syndication since April 2022. But does this mean African governments have bond market access again? And if so, do they even need it?

Don't forget you can #AskGC about anything on the show, or that you read on globalcapital.com. Just email podcast@globalcapital.com

◆ Records smashed in primary markets but what's driving it?
◆ Why order books are so swollen
◆ Rampant demand but companies want to cut hybrid debt

Issuers and investors may agree that this is not a perfect market by any means, but that is not stopping them from getting deals done while they can.

Investors are piling into asset classes that they haven't bought for some time and issuers are happy to take advantage even though pricing might not be the tightest it has ever been. We look at how this fear of missing out in the first weeks of the new year is helping issuers smash records in the bond market and what might threaten it.

One asset class issuers are less keen to strap on more of is hybrid debt — for investment grade companies at any rate. A new issue this week flew out of the door, which would usually be a signal for other companies to launch their own deals. But if anything, companies want less of this debt on their books. We explain why.

Don't forget to #AskGC about anything that features on the show or that you're curious about from elsewhere in the capital markets. Email your questions to podcast@globalcapital.com and we will endeavour to answer the best questions on the show.

Amid all the records being smashed across primary bond markets this week, one could be forgiven for missing what has been happening in the sterling bond market. But fear not; we were all over it.

From remarkable debut deals from corporate issuers to a change in how public sector borrowers approach sterling bond issuance in what is a very busy time for the market, we discuss in-depth what has been going on, what is driving it and what it means.

Then a change of tack this week as we stop to recognise one of our own. Forgive the self-indulgence but we think it is worth it. Bill Thornhill, our covered bond editor is retiring and we wanted to mark the event by talking to him about where he saw the covered bond market heading next and about his 40 year career from trading cotton to chronicling Pfandbriefe.

And don't forget to #AskGC any questions you have about capital markets for us to answer on future shows. Just email podcast@globalcapital.com, or DM us on LinkedIn.

◆ SSAs throw etiquette out of the window in rapid start to year
◆ Banks blind-sided by sudden correction
◆ Mixed fortunes for corporate issuers

The first few days and weeks of January have always been a critical time for capital markets issuers but perhaps this year more than ever.

As interest rates have risen and central banks have withdrawn support for the bond markets, so issuers have come to rely more upon the first spell of the year for their borrowing needs by front-loading their debt programmes.

This week we looked at how SSA issuers threw etiquette out of the window to great effect, how financial institutions were caught out by a sudden correction in spreads and what the first few trading sessions tell us about the prospects for emerging market and high grade corporate issuers this year.

Ask GC

In a new feature for the GlobalCapital Podcast, we will be attempting to answer your questions.

Each week we will answer a sample of the very best ones (most likely about capital markets but we're also happy to share recipe ideas, sartorial tips and attempt to solve your moral dilemmas if that's what you're struggling with) and will answer them in a new segment on each episode.

To #AskGC drop an email to podcast@globalcapital.com, message us on social media, or comment under one of GlobalCapital or Ralph Sinclair's posts on LinkedIn.

◆ What the most senior debt bankers in the world are worrying about for next year
◆ Who's eating Credit Suisse
◆ If a property company falls in the forest and doesn't make a sound...

One of the very biggest investment banking stories this year was the collapse of Credit Suisse. But its rescue by UBS and what the rest of the Street makes of the demise of its rival is a story that will play out into 2024 and beyond.

In our Review 2023 | Outlook 2024 special report, we have the most in-depth reporting you will find anywhere on what is happening to the stricken Swiss bank's market share, clients and staff, and what its new owners on the other side of Zurich's Paradeplatz plan to do with their new acquisition. We discuss all of those topics on this week's show.

We also look at what the heads of debt capital markets at the biggest bond houses are thinking about business next year, from volumes, products and fees to travel, bonuses and bugbears.

Finally, in this week's news, we look into how the collapse of Austrian property company Signa might affect the bond market and wonder why nobody seems to be all that worried about it just yet.

Read our special report for free here

This is the final episode of The GlobalCapital Podcast for 2023. Thank you to everyone who downloaded us this year and subscribed. We'll be back in the first week of January so in the meantime, Merry Christmas and enjoy the holiday season.

◆ Latin America’s bond markets at an (interest rate) inflection point
◆ Who’d be a primary dealer?
◆ What price briiiiidge loans?

As GlobalCapital launches the poll for our first dedicated Latin America Bond Awards, our podcast takes a deep dive into the region’s troubled capital markets, with special guest Omotunde Lawal, head of emerging markets corporate debt at Barings.

There may not be many deals in the market — at least not public ones, as Lawal points out — but there is masses going on. Javier Milei, Argentina’s new populist firebrand president, has gobsmacked everyone by choosing establishment figures to run finance. Mexico has an election next year that could hold upside for the markets, and in the meantime, the region’s CFOs and treasurers, used to tough times, are getting on with the job.

In Europe, we look at government bond primary dealerships, long a source of gripes for investment banks as it is so hard to make money on them, and easy to lose it. Capital rules are about to tilt the balance of incentives still further, and waiting in the wings are non-bank market makers like Citadel Securities.

Patience is a virtue — especially in the loan market, where bridge loans for M&A deals are having to go on, and on, and on. M&A deals simply take longer to close nowadays, which is changing the dynamics for banks.

◆ German court ruling may hit Bund issuance in 2024
◆ KfW and Länder funding may also be affected
◆ Banks and borrowers shrink loan syndicates

The German constitutional court has rocked the country's public sector borrowers just as they finalise their funding needs for 2024.

We look at how the new multi-billion euro-sized hole in the government's budget that is the result of the ruling will affect Bund issuance next year, as well as the funding programmes of KfW and the countries federal states

Meanwhile, banks are paring down the amount of lending they do to companies in the quest for profitability. But there is evidence that borrowers are perfectly happy with shrinking syndicates. We explain why.

◆ Do green bonds still offer enough reward for issuers?
◆ Crédit Agricole's nuclear option
◆ Banks rush to offer better terms to sub-IG companies

Two sovereign issuers recently complained that the pricing advantage of doing a green bond rather than a conventional one — the fabled greenium — was not enough to justify the extra costs associated with labelled issuance. That prompted us to look across capital markets to see if we could identify the habitats where this hard to spot creature now dwells and whether it was thriving in any of them, or facing extinction. We reveal our findings this week.

Meanwhile, Crédit Agricole has added a novel feature to its green bond framework — the chance to fund nuclear power projects. The inclusion of nuclear energy in the EU's Taxonomy of Sustainable Activities was not without controversy, so we looked into how the French bank and investors will use this new facility.

We also looked at banks' race to lend to sub-investment grade companies at ever better terms and find out why they are doing so just as rates have rocketed and the credit outlook has deteriorated.

◆ Israel has been loading up on bonds since Hamas attack
◆ Is the SLB market about to come of age?
◆ A fresh innovation in corporate lending

Israel has issued almost $5bn worth of bonds since the end of September, an unusual spell of activity for the borrower and one that coincides with its war against Hamas. We examine what deals it has done, with whom, what they will fund and what it means for the rest of Israel's capital markets plans.

Meanwhile, while sustainability-linked bonds have been in the doghouse this year, we uncover some developments in that market that may well assuage investor concerns that the product does little other than greenwashing on issuers' behalf.

Finally, we look at an old dog with a new trick in the loan market as companies alter their revolving credit facilities in a way that lets them have easier access to the money just when they may need it as credit conditions toughen.

◆ US RMBS sales in Europe: immigration or vacation?
◆ UBS AT1 makes nonsense of claims of investor fears
◆ The EU's last hurrah in the SSA market

Concorde and supersonic air travel may be the most famous things that were once yet are no longer transatlantic but the securitization market is another. Stringent regulations since the 2008 financial crisis have made cross-border business difficult. Relief came earlier this year when European regulators clarified what investors needed to do to hold overseas paper and since then business has started to flow.

But it was another, more recent financial crisis that really stimulated the revival. US banks pulled back from parts of their domestic RMBS market after the banking crisis of the spring. Issuers have therefore found a willing audience of investors in Europe. It seems to suit both sides of the trade but doing that business is not without cost. We explain what has been going on and assess whether or not it will last.

Another consequence of the banking crisis was the demise of Credit Suisse and the write-down of $17bn of its additional tier one (AT1) bonds. Some investors swore off the product as a result but this week, CS's new owner, UBS, built the largest ever order book for an AT1 deal. We discuss the reasons for the U-turn in sentiment and look into the deal pipeline.

Also in the pipeline is the last big euro SSA syndication of the year, due from the EU next week. We talk about what sort of market the EU will find when it brings its deal, and moreover, what it tells us about the full scale resumption of issuance in January.

If you thirst for more on securitization, track down Another Fine Mezz, GlobalCapital's weekly podcast dedicated to the market.

Sustainable finance has become a huge market, with issuers all over the world having sold more than $2 trillion of green bonds. Yet the climate emergency is still getting worse. Finance is committed to aligning with the Paris Agreement, but is it on track?

In this special podcast supported by the European Investment Bank to coincide with the World Bank/IMF annual meetings in Marrakech in October 2023, Nancy Saich, the EIB’s chief climate change expert, and Eila Kreivi, its chief sustainable finance advisor, discuss the finance industry’s efforts to become sustainable.

They point out that no parts of the financial markets are yet fulfilling the Paris commitment. While finance is flowing to green technologies, this needs to increase massively – and just as importantly, the financing of fossil fuel expansion has to end.
Between those two priorities is another – financing the whole economy as it transitions. Saich and Kreivi discuss how the financial system can create standards to define what is an ambitious transition, and what is a just one.

Capital Ideas is GlobalCapital's dedicated podcast channel for thought leadership. To find out how GlobalCapital ***can help your organisation amplify its message, contact:

Jack Thomson, publisher
jack.thomson@globalcapital.com
+44 20 7779 8083***

North Africa is one of the most important regions for the European Investment Bank’s financing outside the EU, and one where it sees great potential for funding sustainable development.

In this special podcast supported by the European Investment Bank from Marrakech, which is hosting the World Bank and IMF annual meetings, Ricardo Mourinho, the EIB vice-president responsible for Morocco and Tunisia, explores the Bank’s activities in the region.

Its presence there is longstanding – in Morocco it has invested €10bn since 1979. The EIB’s involvement is also deepening, with recent investments spanning renewable energy, water, sanitation, education and health. In the immediate aftermath of the September earthquake, the EIB first worked with the Moroccan authorities to repurpose existing investments, and then pledged €1bn to the reconstruction programme.

Longer term, climate change is a serious challenge for the region – the need to manage water carefully is becoming a key priority, as is sustainable transport. Mourinho emphasises that “the future is green”, so the EIB will not fund projects that are not Paris Agreement-aligned.

Capital Ideas is GlobalCapital's dedicated podcast channel for thought leadership. To find out how GlobalCapital ***can help your organisation amplify its message, contact:

Jack Thomson, publisher
jack.thomson@globalcapital.com
+44 20 7779 8083***

◆ The Beatles may have a new, if that is the right word, song but one of their classics sums up Zambia's debt restructuring best
◆ The bank treasurer's dilemma
◆ A new index for the covered bond market

To say Zambia has had a convoluted route to get to its debt restructuring is something of an understatement. But it has made major progress this week and the deal it has arrived at with bondholders could be a sign of things to come for the many other emerging market countries negotiating debt relief. We delve into the new debt package and assess its pros and cons.

Meanwhile, at the other end of the credit spectrum, we take a look at the dilemma facing covered bond issuers for the month ahead. Their travails are emblematic of those facing funding officials in all corners of the bond market — whether or not taking the opportunity to issue now will be a smart move to get ahead of the pack in January.

We also look into a new index for the covered bond market from JP Morgan and ask if it solves the problem it means to and whether it will be widely adopted.

◆ Why the PE industry is going to have to make the IPO market work
◆ Real estate, real refi risk
◆ Managing the SSA bond pipeline

The European IPO market is in a pitiful state. Of the few deals that do make it to book building, some are pulled while some that are priced then tank. Discounts are eye-watering and a lack of liquidity makes bringing mid-cap companies all but impossible. As one ECM banker told us this week, "something has got to give."

Well, it turns out it might just be the private equity industry that does the giving. We discover why financial sponsors must start coming to the IPO market next year and what they can do to manage the risks of doing so. "The whole world is trying to work out what this new price of money actually means," said one market participant.

It seems to mean little but misery for a number of real estate companies. A sector that thrives on high leverage, it is starting to face genuine refinancing risk now interest rates have soared. We sort those that have access to capital from those that have none and discuss the latter's options for staying alive.

Speaking of interest rates, the ECB stood still this week with its monetary policy. We looked into what that means for the sovereign, supranational and agency bond market for the rest of the year, and more importantly, for January — traditionally the busiest month of its funding calendar.

◆ Scottish government puzzles bond market with debt plan
◆ Saudi sov wealth fund makes sukuk debut as crisis in Middle East deepens
◆ Supranational hybrids and other highlights from the IMF/World Bank Annual Meetings in Marrakech

Scotland's first minister Humza Yousaf caught the attention of the bond market this week by revealing plans for the country's first sovereign issue. The plans are vague and he has given himself until May 2026 to price one, so we cast our net far and wide to see what the market thought of the idea and whether it's prudent policy or political posturing.

As GlobalCapital said would happen last week, there was debt issuance from the Middle East, despite the escalation in fighting between Israel and Hamas. It was a landmark trade too: Saudi Arabia's Public Investment Fund's debut sukuk. We assess how it went and what comes next, if anything, for emerging market bond issuers.

Scotland's plans for sovereign bonds, or Kilts as we're calling them, may have been eye catching but they're not the only innovation in the SSA market at the moment. Far more concrete an idea — and with far greater consequences for the market at large, and development finance generally — is hybrid capital from supranationals.

They were a hot topic at the IMF/World Bank Annual Meetings in Marrakech last week, from which our team has just returned to share the most important discussions that took place from development bank capital, to Morocco's earthquake recovery to the impact of war in the Middle East and more.

◆ Will Israel-Hamas conflict or US rates derail EM primary?
◆ Europe's IPO market dealt a new blow
◆ Private credit muscling in on investment grade lending

Emerging market issuers sold no dollar bonds in the immediate aftermath of both Hamas's attack on Israel on October 7 and Israel's initial response. But the violence was not the only reason for the lack of issuance, as we discover. EM bond printing is set to resume imminently and from the Middle East, of all places. We explain why and how.

Meanwhile, another pulled IPO in Europe was another kick to a market that is most definitely down. We discuss Planisware's decision to hook its listing and what the ramifications will be for future IPOs. We also look at where new listings activity might now come from.

Finally, we look at how and where private credit is making inroads into lending to investment grade companies, a business traditionally the reserve of banks. We find out that they have a niche to exploit that might well develop into what some are calling a "symbiotic" relationship with traditional lenders as they do the business the big banks won't.

◆ IG investors comfort eat sweet spreads
◆ What can FIG issuers do now?
◆ US HEI securitizations: mainstream or flash in pan?

With some core government bond benchmarks soaring to their highest yields in over a decade this week, we looked at the effects long term rising interest rates and short-term spikes in yields are having on what investors will buy and what issuers can raise from the capital markets.

We discover from which end of the risk spectrum corporate bond investors are keen to buy and what effect that is having on the pricing of the riskiest types of investment grade bonds.

And we also look at the market from a bank funding official's point of view and how their menu of capital raising options is changing in the bond market.

Finally, we look into a burgeoning asset class in US securitization — deals based on home equity investments — and find out that higher interest rates are both friend and foe to the development of this market.

◆ Central banks and governments want to take banks’ money
◆Where has the greenium gone?
◆ Direct lending goes investment grade

Banks have been having a whale of a time as issuers in the bond market this month, with ample demand. But a whole gang of threats is creeping towards them. Having failed to pass on higher interest rates to their depositors, banks are vulnerable to a deposit war, in which banks compete with each other to raise rates and attract deposits – but worse, governments are wolfing the same money by issuing very popular retail bonds that pay far more than deposits.

Meanwhile, central banks are not satisfied with the monetary tightening measures so far and want to actively drain liquidity out of the banking system. The European Central Bank is talking about massively jacking up its Minimum Reserve Requirement, which would force banks to park money idly and squeeze their profits. It might also start selling its QE holdings of bonds into the market, which again would suck deposits out of the banks.

All of this points to banks having to borrow much more in the bond market, which could be painful for the weaker brethren. Worst of all, it could tip the banking sector into a crisis, or the economy into a recession.

Plus we look at the dwindling greenium in the public sector bond market and the new craze among direct lending funds: investment grade companies.

◆ Should markets rejoice or worry? ◆ FIG borrowers are gung-ho ◆ Topping rates poses quandary for EM ◆ CLO investors sort sheep from goats

Capital markets of all stripes wrestled this week with one question: what happens next to interest rates? Each market had its own interpretation, and they were surprisingly different.

Public sector bond specialists worried about how the Federal Reserve and European Central Bank’s ambiguous behaviour will affect deal appetite. Financial institutions are loving it and cracking on early with next year’s funding, while corporate borrowers are finding investors want just one thing: spread.

For emerging markets the stakes are much higher and the gambles issuers have to make much riskier. And we hear from the European CLO market, where investors are beginning to do what might seem obvious: distinguish between different CLO managers.

◆ A new NPL threat to Italian banks
◆ Hybrid capital gets a makeover
◆ Covered bond liquidity
◆ SSA market finds its rhythm

Reaction in the markets to Italy's plan to allow bad lenders to buy back their loans at a small premium to what the owners paid for them has been both critical and robust. Is it just private investors griping about not being allowed to make enough money, or is there something bigger and more fundamental at stake for Italy's banking sector? We find out.

We delve into what Moody's revision to how it assesses hybrid capital means for issuers and give an update on some innovative deals in the asset class for multilateral development banks.

Meanwhile, news from Munich where we took the pulse of the covered bond market at its biggest event of the year and, finally, a sense of direction in the SSA market this week as two European institutions weighed in in the form of the EU and the ECB.

Some corporate borrowers are finding the once verdant loan market a hostile spot to hang out lately, driving some companies to test out bonds for the first time. If a debut deal this week from Germany’s Rewe — which seems to still be able to access loans without any problem — is anything to go by, then the potential debutants planning to take the plunge should feel very confident indeed.

In the world of SSAs, the market has been hit and miss in ways that bankers and issuers find hard to define. There are three major theories as to why, as explored in the podcast, but the most striking one is that the market is holding its billions of euros back for the European Union’s late summer syndicated trade.

Meanwhile, somewhere famously not in the EU has run into some bother. The UK’s second largest city and England’s largest council, Birmingham, is facing a funding crisis. Beyond the acute problems for the city itself, the financial failures have put a significant dent in long held hopes that the UK local authorities might start to take more funding from the capital markets.

Finally, we head to Turkey, where two of the country’s biggest banks — Vakif and Yapi Kredi — were in the market on consecutive days, to the detriment of both deals. The Turkish sovereign has another $2.5bn to raise before the end of the year, so we discuss what can be gleaned from the banks’ outing.

◆ Nordea's novel twist on sustainable funding goes mainstream
◆ Corporate and SSAs: here for the duration
◆ Gabon and off: coup hits bonds

Having inaugurated the product in its home currency markets, Nordea this week brought its SLL bonds to euros. The deal's proceeds are dedicated to funding the lender's sustainability-linked loan book, creating an instrument that is ESG-themed but is neither a sustainability-linked bond, nor a green bond. We examine its credentials and find out who else might be issuing one.

In the primary bond market this week, there was clear evidence that investors want long-dated bonds, which has not been the case all year. This was clear in the corporate bond market where long-dated tranches were much in demand but what could SSA issuers be doing to take advantage of this trend?

Finally, regular listeners will be familiar with Gabon's recent debt for nature swap, which included a new blue bond. We look at what a coup in the country means for the issuer's debt pile.

Issuance returned to multiple debt markets this week after the summer drought, with the sovereign, supranational and agency market and corporate bond markets seeing a spurt of trades.

While everything was orderly, there was a noticeable lack of pizzaz to many of the trades, with small books compared to historical averages and some issuers needing to pay higher than usual premiums.

This is not what the market wants to see before the September surge starts in earnest. The coming weeks are going to be packed with deals, and in an ideal world, borrowers would be going into this frenetic period knowing that order books are bulging and premiums are thin.

Meanwhile, in the CLO market, spreads are nearing their magic number. With spreads tightening around 25bp, and CLOs that priced last year taking the defensive measure of adding short non-call periods, a handful of CLOs are already looking to take advantage and reset their deals to a tighter spread.

However, for more CLOs to join the trend, spreads need to tighten by a little more. But once that happens, it’s off to the races for resets, and the market can expect to see a deluge of repricings in short order.

For this week's episode of Another Fine Mezz, securitization deputy editor Tom Lemmon is joined by European CLO reporter Victoria Thiele, but European ABS reporter George Smith is off to become a Dad.

In the US, specialist CLO equity funds believe they're "winning the argument" as limited partners (LPs) who invest in the manager-retained equity (known as captive funds) become frustrated at their squeezed returns.

Meanwhile in European CLOs, triple-A investors are also frustrated. They're looking to limit the power of CLO managers being willfully dragged along into amend and extend deals by beefing up the legal documents before investing in a CLO.

And finally, the Financial Conduct Authority's (FCA) 707 page document outlining its plans for the UK's post-Brexit securitization regulation is still being digested. The question is how the UK securitization market going to look once its implemented.

◆ China property co debt straits play out in EM...
◆ ... and European corporate bonds
◆ The industrious sterling bond market

The aftershocks of Chinese property development whopper Country Garden's revelation that it would miss bond coupon payments rippled across the world's capital markets this week. We follow the trail from the beleaguered builder throughout the capital markets to see how it could hit the European corporate bond market and how it has already impacted upon demand for emerging market bonds.

As the German dramatist Gotthold Lessing wrote, "...everything is connected, everything is interwoven, everything changes with everything, everything merges from one into another." This is one of those fascinating threads in global finance that demonstrates the interconnectedness of the world's economy and markets. The picture was rosier in the UK, however (and how often has anyone been able to say that the last couple of years?), where the sterling bond market is in fine form. We highlight new bonds from a couple of UK FIG borrowers and examine why the market is so busy when others appear to be on a summer holiday. Who says the UK has a problem with productivity?

Central Africa’s Gabon did what no other African sovereign has done this week when it completed a debt-for-nature swap which included the first ever blue bond from the African continent.

But the deal did not come without its intricacies, as the sovereign got an insurance from the US Development Finance Corp, meaning that the usually Caa1/B- rated country was now selling Aa2 rated debt.

It took a couple of attempts to get the deal right, after the sovereign postponed the deal last week because of rates volatility. We delve into what it took to get such a deal over the line.

Meanwhile, the FIG market is going full guns blazing with multiple deals pricing this week. One of the standouts was an Additional Tier 1 trade from BNP Paribas in dollars, the first such deal in the currency since Credit Suisse sent shockwaves through the AT1 market on its collapse.

◆ US downgrade: why, if you liked US Treasuries at 3.96%, you'll love them at 4.18%
◆ A new fund for forests
◆ The African sovereign bond paradox
◆ Pemex problems

There was a lot going on in the US Treasury market this week, following a downgrade of the sovereign by Fitch, an increase in government borrowing beyond what was expected and jobs data. We delve into what it means for the bond market.

Meanwhile, former World Bank treasurer Ken Lay is gaining some traction lately with an old idea he has been working on for years — a sovereign wealth fund to save forests. We explain how it would work and which countries are up for it.

Finally, we turn our attentions to the emerging markets where some see the return of Gabon to bond issuance this week as a sign that other African sovereigns will follow. But there's a paradox: investors don't want to buy bonds from those issuers until the yields are lower. We explain why and whether any of those issuers will be forced to raise debt capital anyway and how they might do it.

We also talk about mounting problems at Mexico's state-owned oil company, and EM bond market giant, Pemex.

◆ Deep dive into new SSA asset class

◆ What the possible return of NoChu means for Europe's CLO market

◆ US market braces for aircraft ABS revival

The African Development Bank is at the forefront of the biggest development in SSA debt issuance in years. It will likely price the first hybrid deal from such an issuer in the coming weeks and months. We examine why it is doing so, how the deal will work, who will buy it and what it will achieve.

Meanwhile, Norinchukin Bank might just be back buying CLOs again. It was the biggest buyer of the product by far until a couple of years ago when regulations forced it to back down. But as evidence mounts that the so-called "CLO whale" is back in European waters, we delve into what that means not just for that market but beyond, as far as Europe's leveraged loan market.

Finally, aircraft ABS have been on a tear in the US market. That has some insiders excited about the prospect of an issuance revival, following years of very little thanks to the ravages of the pandemic and the invasion of Ukraine on the aviation industry. But as more people take to the skies, we look at the prospects for new ABS.

◆ G20 tries again for MDBs to do more
◆ The investment case for Turkey after UAE steps in
◆ Will the CMBS revival be stunted?

Multilateral development banks, which borrow money from the bond market at triple-A rates to fund projects in the developing world, are the subject of great scrutiny as the world claws its way out of the pandemic and grapples with climate change.

The G20, which met this week in India, is urging them to raise more on the capital markets to lend greater support in the developing world. This week, we reveal how these financially conservative institutions are coming round to the G20’s way of thinking after much initial resistance. We discuss why and what that means for the capital markets.

Meanwhile, the UAE has made a huge financial commitment to help Turkey as it recovers from devastating earthquakes in February. We took the opportunity to examine how that and president Recep Tayyip Erdogan, re-elected in May, might be changing international investors’ views on the country.

Finally, the European CMBS market is making a comeback. We discuss how but more importantly, what structural impediments limit this asset class from reaching its full potential.

◆ "Nobody on the road, nobody on the beach," as issuers spy their chance
◆ Why SSAs are in prime position for the rest of the year
◆ A record breaking deal in Asia's equity-linked bond market

Don Henley lamented the lack of people on the road and the beach in his song The Boys of Summer. Some in the bond markets might be thinking the same almost 40 years later as there appears to be very little let-up in issuance activity, putting paid to the old saw that summer is an idle period for primary markets.

We find out why bank issuers in particular are looking for opportunities to raise debt capital and what the risks could be of entering the corporate bond market.

One issuer group in a strong position, however, is SSAs. We find evidence in a syndication from the EU this week that the balance of power lies very much with the borrowers.

Meanwhile, LG Chem issued a stunning dual tranche $2bn exchangeable bond this week, smashing all sorts of records in the process. We examine the deal and find out discuss the next lot of equity-linked issuance is coming from given the clear investor appetite for the product.

◆ The World Bank's Valerie Hickey 'we need green systems, not projects'

◆ Two airports praised for SLBs

◆ Three IPOs revive market for European listings

Valerie Hickey is the World Bank’s global director for the environment, natural resources and the blue economy. She talked to us about the challenges the world faces in getting capital to developing countries, what the World Bank is doing about it and how a change of thinking is needed to make development finance more effective.

Meanwhile, Heathrow and Aeroporti di Roma both priced sustainability-linked bonds this week. The product has come in for criticism this year but market participants had good things to say about these two deals. We investigate why and question just how effective a tool these will be for bringing change to the aviation industry.

Another market that has not had a vintage year is that for new listings in Europe. But three IPOs were priced this week, giving us cause to ask whether a full recovery is underway.

◆ Its pipes leak but does Thames Water’s debt structure hold water?
◆ How the EU’s funding for H2 impacts the SSA market
◆ LatAm issuers like London buses but not for the obvious reason

Thames Water, the utility that hydrates over a quarter of the UK population, ran into trouble this week that could result in its renationalisation. We examine the company’s debt structure and assess what it means for the health of its whole business securitization.

Meanwhile, the EU revealed a much smaller funding requirement for the rest of the year than many expected this week. We discuss its impact on other SSA issuers and how it affects the issuer’s quest for investors to view it as a sovereign borrower.

London buses, the cliché says, don’t come for ages and then several arrive at once. That’s the tale of the Latin America primary bond market this year too but it’s not the only comparison to be made with the double deckers on the UK capital’s streets because plenty of this week’s deals were also big in the red. Several well-known issuers priced new issues, some of which were over $1bn and some of the week’s bonds went on to trade below reoffer. We assess what that means for LatAm issuers in the weeks to come.

◆ A dicey moment for bank bonds
◆ Unibail shops for hybrid solution
◆ Vibes from this year's 'Euromoney'
◆ The ESM's new MD speaks to GlobalCapitalThe covered bond market had a wobble this week. It was the last thing bank bond issuers needed just as the wreckage of Credit Suisse and Silicon Valley Bank disappeared from the rear view mirror. But it could be the first sign of further volatility in FIG bonds with the market set to face an imminent, severe structural readjustment.

Commercial property firms are a class of issuer that have been facing up to tougher conditions for some time, leading to trickier financing conditions. We discuss shopping centre operator Unibail-Rodamco-Westfield’s novel way of refinancing its hybrid debt, which is callable next month.

The 32nd edition of Euromoney’s Global Borrowers and Investors Forum took place this week, at which GlobalCapital played a prominent role. The event, such a big part of the bond market chalendar that it is known to most simply as “Euromoney”, draws in anybody who is anybody from the SSA, FIG and European corporate bond markets. Well, we certainly found a somebody to speak to: Pierre Gramegna, the new MD of the European Stability Mechanism spoke to us at the conference about the institution’s future.

Another blow for London listings
Cold property: US offices worry CMBS
AT1 market revival
SLLs vanishing

WE Soda, the soda ash producer, pulled this week its much heralded London IPO. It was a blow that the UK’s equity capital market and the European IPO market needed like the proverbial hole in the head. We examine what went wrong but discover that all is not lost, with three other deals in the works.

Meanwhile, the bank bond market has gone from strength to strength since the dark days of Silicon Valley Bank’s and Credit Suisse’s collapse in March. BBVA and Bank of Cyprus placed the cherry firmly on top of the comeback cake this week by pouncing on investors’ hunger for yield to serve up a pair of stellar AT1 deals – the asset class at the centre of Credit Suisse’s controversial rescue.

The situation is more worrying in the US CMBS market where a perfect storm highlights the peril of offices and a section of the securitized products market. Finally, in the sustainability linked loan market issuance is shrinking but as we discover, that might be a good thing.

AI: the cheat code to cheap labour?
Why NY might be about to get it very wrong on sov debt restructuring
A huge green bond debut for Aussie mining state

Artificial intelligence might not have made it far past drafting generic deal pitches and finding a list of comparable bonds just yet but that, it could be argued, is already a chunk of what junior bankers do when they are learning the ropes.

As yet unable to solve some of the more serious inefficiencies in the capital markets industry yet, the use and uses of AI are surely only going to grow. We look at what the consequences of that might be on jobs and how business is done.

Meanwhile, legislators in New York are working through reforms to sovereign debt restructuring laws that would enforce the inclusion of private investors. We examine the perils of doing so.

Finally, Western Australia priced a huge debut green bond last week. The state has a huge mining industry that does environmental harm. We find out why none of the proceeds of the bond will go directly on reducing its impact.

An attempt to raise standards in the SLL market
Will WE Soda’s IPO pop?
Grocer price caps enrage bond investors

First off, apologies to John Betjeman for the above mauling of his work but it isn’t often that you see market participants applauding attempts to regulate what they do and it inspired us to verse, albeit not our own. That happened this week when the UK’s Financial Conduct Authority decided to investigate the sustainability-linked loan market to see if things needed tightening up. We tell you what they are and why.

Meanwhile, after years of fretting over its status as a major equity market, London is about to host the biggest listing in Europe all year. WE Soda may not be the sort of glamourous tech company the UK craves for its stock exchange but it will be a big deal and a big moment for both the UK and European IPO markets. We discuss what is at stake.

Meanwhile, bond investors expressed fury that food retailers might be subject to price caps. We examine why.

How borrowers are navigating the US’s debt ceiling stand-off
The rise of Middle East capital markets
Tougher times ahead for European corporate issuers

This was the week when capital markets really started to worry about the US hitting its debt ceiling. We examine how that affected issuers in the dollar market this week from SSAs to the big Wall Street firms, to big companies. But the tension has spread far beyond the US, including to the European corporate bond market where, if you looked closely, there were this first signs of trouble after a buoyant three weeks of issuance. We look at how that market will cope in the coming weeks and months given Uncle Sam paying his dues is far from its only worry.

The Middle East capital markets have also been in fine form. Not only do we discuss the sukuk market’s stellar year and weather this marks a turning point in its development; we also look at an astonishing IPO from Abu Dhabi to see what it tells us about the growth, but also the limitations, of the region’s capital markets.

Sukuk market flying but other parts of EM in peril
What now for Turkis issuers?
SSAs dive into dollars despite debt ceiling threat
Exciting pricing in UK RMBS

Emerging market issuers are hardly a uniform bunch and that was demonstrated this week with some taking full advantage of an undersupplied sukuk market, while in Latin America, some borrowers are facing disaster. Meanwhile, in Turkey, market prices last week suggested investors and dealers got their election predictions wrong. With the run-off vote approaching, we look into how Turkish borrowers’ market access will shape up.

The dollar market has become a less reliable place for SSA issuers since the Federal Reserve started putting up interest rates. But issuers piled in this week as pricing fell in their favour. We look at the impact the problems with the US debt ceiling may have for these issuers.

The RMBS market was ablaze with activity this week too with three deals. Two of them — for Lloyds and Virgin Money — achieved remarkable pricing. We discuss those trades and what they mean for a market that is likely to once again become a more important part of banks’ funding mix.

Pivotal moment for Turkey’s bond issuers
Once upon a time… in Ecuador
Crunch time for RMBS

It’s not every day that a Hollywood megastar endorses a bit of finance arranged by a notorious investment bank to protect the Galapagos Islands; in fact that is a very specific set of circumstances indeed. So, when Leonardo DiCaprio posted on Instagram this week in praise of the largest debt for nature swap so far — for Ecuador, arranged by Credit Suisse — we had to talk about it.

The drama around the deal is even higher for it coming at a time when Ecuador’s president is at risk of impeachment. And another president who might be facing an imminent exit is Turkey’s Recep Tayyip Erdogan. We look at what the country’s elections this weekend will mean for its bond issuers.

Finally, we brace for a critical period in European securization as RMBS issuance ramps up as banks wean themselves off central bank funding.

European banks duck out of lending and underwriting
Can risk transfer solve the US banking problem?
Irritation in the corporate bond market

Evidence has emerged of banks, particularly from Europe, doing less funding for high polluting clients. It represents a riposte to accusations of greenwashing but, as always in green finance, we discover there are many shades of grey. Meanwhile, US regional lenders are under further pressure. We look into whether a technique popular in Europe for managing risk could save them. Finally, we examine whether corporate bond issuers’ claims that their banks are serving them poorly in terms of telling them what investors want are warranted.

Italy and Switzerland give bank bonds a boost
A renaissance for emerging market corporate issuance… or not
Using pension funds to fix UK equity capital markets

Banks’ access to debt funding and capital hit two important waypoints on the journey back from March’s crisis towards full health. UniCredit called an additional tier one deal, reassuring investors that all is as it should be in the asset class, and a Swiss bank priced a bond in the international market. But, as we discover, questions remain for the sector despite both events.

Meanwhile, a bond for a South African energy firm was the sort of deal that might be expected to lead to a spree of emerging market corporate issuers in the market. But here too there were plenty of reasons to be sceptical of a full reopening taking place.

Finally, we looked at hopes that the pensions industry in the UK can fix the country’s equity capital markets — if only someone could figure out how…

NEXT WEEK: GlobalCapital did its first ever editorial webinar this week with three of its editors tackling your questions on some of the biggest topics in capital markets. You can view it here. And if you have a question you’d like us to answer, or any comments you’d like to make based on the webinar, or indeed anything you encounter on GlobalCapital, then please email us at podcasts@globalcapital.com and we will do our best to tackle some of them next week.

Will securitization finally throw off the shackles?
Bank funding progress report
EU sustainability taxonomy causes more aggro
Australians take over European corporate debt

European securitization has been in something of an open prison, GlobalCapital argued this week, since the 2008 financial crisis. But the end of central bank funding schemes — themselves an indirect consequence of that crisis, which securitization carried the can for — means that ABS could be about to break out. We examine the market to see if it is going to rediscover its pre-crisis heyday. It will be a key funding source for banks, which this week showed how well they are recovering from the March madness that claimed Silicon Valley Bank and Credit Suisse. But, as we discover, the market still bears scars. Meanwhile, new additions to the EU Taxonomy for Sustainable Activities are proving just as controversial as what was already in there. And finally, we work out why so many Australian companies hit the European corporate bond market this week and discuss the implications.

Quantum computing’s impact on capital markets, oh boy!
IPOs are back, and they’re going to be done differently
The corporate hybrid debt market’s biggest test
A green rating to rule them all

We assess what boffins and bankers have been telling us about the impact quantum computing will have on financial markets. As is so often the case with technological leaps, views differ between whether the computational power that quantum offers is a solution in search of a problem that isn’t already being solved adequately by Microsoft Excel, or whether we stand on the cusp of a genuine revolution in how markets work. And of course, there are huge risks to consider, not least around security. Is the sky the limit, or is Skynet the limit? We examine the claims. We also look into the European IPO market’s comeback and a shift in how deals will be done; an intimidating amount of corporate hybrid debt that needs refinancing; and a new venture for rating companies’ green claims.

Europe’s big banks issue for first time since Credit Suisse collapse
Investment grade corporates power through
What makes a crisis?

Lent appeared to end early in the bond markets this week as issuers across the credit spectrum brought a rash of deals, leaving encouraging markers for the weeks ahead. By recent standards of market dysfunction, issuers have been quicker to come back to the market than some would have expected. But were these Easter eggs all they cracked up to be?

Certainly, issuance resumed after the hiatus caused by the demise of Silicon Valley Bank and Credit Suisse last week but it powered up a notch since as big eurozone banks entered the fray, well rated corporates issued deals and even high yield issuers priced bonds. But we took a closer look at how these deals performed and how well investors digested the feast to give a health assessment of the capital markets. We also looked ahead to what could quash the positive feeling that drove issuance this week.

Among those items on the worry list is, of course, the banking crisis that has dominated the markets for the last month. We talk not only about whether it is over but whether it is even right to call it a crisis in the first place.

Banking crisis not over, says veteran analyst
Why European banks are sitting out the primary market revival
From Berlaymont to Berlin: reading the runes in the SSA market

The creatures of the capital markets poked their noses tentatively out of their burrows this week to see if the banking storm had passed and to survey its impact. Issuers tested the primary markets with new bonds and no further banks needed rescuing. But, according to veteran equity analyst, Steve Clapham, founder of Behind The Balance Sheet, this could well be a lull in the torrent rather than the promise of blue skies from now on.

He talked to us about the state of the banking sector, its serious problems, the difficulty in fixing them and whether more lenders could go to the wall in the near future.

Meanwhile, we looked into when banks will be able to issue fresh debt and what they will be asked to pay for it after a week where they were the most cautious type of issuer to do venture into new public funding.

It was a different story in the sovereign, supranational and agency bond market where there were deals galore. But after a barnstormer from the EU, the following pack did deals that were less spectacular. We assess what this tells us about the state of the bond markets.

Is the banking crisis over?
Is additional tier one capital finished?
Rival banks will try to pick off Credit Suisse’s corporate clients

The elimination of Credit Suisse as an independent bank last weekend was swift and clinical, but the market response has been anything but. Bond issuance was all but closed this week.

Financial institution bond spreads widened massively at the beginning of the week, especially on additional tier one capital (AT1) bonds. This uber-geeky product became a household name when the Swiss authorities decided to wipe out all Sfr16bn of Credit Suisse’s AT1, treating it worse than the equity. We discuss whether AT1 can recover or is now fatally tainted.

We also explore when and how bond issuance will resume by public sector, financial and corporate borrowers. Volkswagen did manage to bring a successful deal this week, but in general even the public sector space was barren of deals as issuers shied away from the volatility. There were high hopes for next week, but with bank stocks falling on Friday, they are now fading.

Investment banks are already sensing an opportunity amid all the angst, however – they are trying to woo away Credit Suisse’s high quality corporate clients. It is early days, but there are reasons to believe they may have good success.

Will Credit Suisse survive and in what form?
Tech lending after SVB
A false dawn for EM issuers

Swiss regulators are known for making capital requirements tougher for their banks than rule makers elsewhere — it’s known as the Swiss finish. But that didn’t prevent the Swiss National Bank from having to provide a Sfr50bn lifeline to Credit Suisse this week and the bank’s future is still far from certain.

We investigate whether the crisis-dogged Swiss lender will have time to implement the restructuring it began in October or whether it is about to have a completely different solution imposed upon it, with options including being sold to its local rival, UBS.

Credit Suisse got caught up in the aftermath of the collapse of Silicon Valley Bank (SVB) as markets scoured for weak links in the banking sector. We look this week, however, at what the funding for the tech sector will look like now that HSBC owns SVB UK.

We also discover how hopes faded over the course of the week for emerging market issuers, which some had hoped would benefit from the rally in US Treasuries that followed the SVB disaster. Turns out it was the wrong kind of rally.

Hand wringing at the end of Arm saga
Green bond rebirth for corporate issuers
Getting private money into development finance
Lenders look to engage Europe’s telcos

Arm gave the UK equity capital markets a slap this week when it opted to list in New York rather than the celebrated microchip designer’s home exchange in London, despite huge efforts to persuade it to do otherwise. It has prompted a lot of soul searching about the state of the UK as a listing venue but we question if things are really that bad, or if the UK is even being judged against the right peers.

There has also been a resurgence in corporate green bond issuance as the market starts to find fault in sustainability-linked bonds. We look at what is driving the trend back to the OG of ESG-themed securities and what companies’ labelled funding mixtures will look like in future.

One of the biggest problems in global development is the mobilisation of private capital. We report this week on how a new fund is looking to solve the problem and what other solutions the capital markets have come up with to bridge what some reckon is a $2.6tr gap that needs to be bridged for the world to meet the UN’s Sustainable Development Goals.

Finally, we investigate the telecoms sector, which promises to be a big source of lending activity for banks in Europe this year if only something would stop holding it up.

QT walks among us
Companies get a yen for yen
Divi recaps return
EU sets Green Bond Standard

Quantitative tightening got a bit tighter this week when the ECB stopped showing up in the order books for new covered bond syndications. The central bank’s asset purchases have been a defining feature of Europe’s bond market for the last few years as used its balance sheet to fight crisis after crisis. We take a look at what the impact will be of its withdrawal and who is taking up the slack.

A week ago, GlobalCapital reported on how expensive it was becoming for some banks to lend dollars to their corporate clients. This week, we found cheaper alternatives in Asia. We delve into the trend for yen in the loan market as borrowers look to manage their funding costs in a world of rising rates.

Meanwhile, one of the more bullish types of leveraged finance issuance is back – the dividend recap – despite the dust barely having settled on last year when banks struggled to syndicate leveraged debt into the wider market. We examine what has driven this spate of deals and whether there has been a sudden change of heart among investors.

Finally, the EU has agreed a political deal for its Green Bond Standard. But of course, negotiating such a thing over the five years it has taken is mere child’ play in European regulatory circles. We look into what needs to happen next for it to matter, including its passage into law and problems with the EU’s Taxonomy for Sustainable Activities.

Upheaval in the CEE bond market
Covid aftershocks in the US CMBS market
What Banga means for the World Bank and SSA bonds

Russia shocked the world a year ago today when it invaded Ukraine. The world has felt the effects, including the capital markets. To mark the occasion we look into three areas of the markets profoundly changed by the war and question how they will develop as the conflict rumbles on.

The pandemic also had a profound effect on how we live our lives, in particular how and where we work. This is now starting to affect the securitization market in the US where deals backed by commercial mortgages are facing rising delinquencies because of the move to hybrid working and rising interest rates. We dissect this market and look at what lies on store.

Finally, it’s all change at the top of the World Bank as it searches for a new president to replace David Malpass who resigned earlier in the week. It may not be the biggest issuer in the capital markets but it is certainly among the most influential institutions on the planet both as borrower and lender.

Moreover, the change comes at a time when some are urging multilateral development banks to borrow even more. We look into the surprise nominee for the presidency, Ajay Banga, and what his appointment, if it happens, means for the world’s development banks and their place in the capital markets.

Are EU bonds govvies yet?
Fast moving credit market develops a strange rattling noise
Debt-for-nature: from the Galapagos to the developing world

The EU’s huge funding programme and how it issues debt make it appear very much like a sovereign borrower. But while it might like to view itself as such, its audience of investors and bankers don’t entirely agree that it is… yet.

We discuss why the EU wants to be part of the govvie market, what it needs to do to get there and discover that there could be all sorts of consequences if it achieves its goal in the eyes of the bond market.

Meanwhile, the go-faster stripes seem to be wearing off of the speeding credit market as investors worry about spreads and interest rates and some new bank and corporate bond issues start to look a little stodgy — and it could not be happening at a worse time for issuers.

Finally, we look into debt-for-nature swaps and how this innovative bit of financing could help vulnerable countries deal with two of their most pressing problems: global warming and debt sustainability.

Do two IPO swallows make a summer, or a winter of discontent?
Why investors think SLBs are 'worthless' and what to do about it
The buy-side grapples with government green bonds
Moans in loans

The first two IPOs in Europe this year were priced this week, for Ionos and EuroGroup Laminations. They were a key test for the market after a dismal 2022 when many new listings were shelved as market participants grappled with inflation, rising rates, the threat of recession and geopolitical horrors. We examine what the deals tell us about equity capital markets this year.

Meanwhile, all is not well in the sustainability-linked bond market, a nascent crucible of innovation that aims to help issuers meet environmental targets. We look into why investors are calling the coupons the bonds pay irrelevant and look at the latest efforts to value the economics of these trades more meaningfully. We also look at a new resource to evaluate government green bonds.

Finally, although the bond markets has had a stellar start to the year, activity in the loans markets - an alternative source of capital for companies - is way down. We ask why and discover why having such a busy bond market could in fact be a source of encouragement for lenders.

Investors bored with sustainability targets
How green was my allocation? Bookrunners won’t tell you
Can emerging market borrowers keep up the comeback?

There’s a clash brewing in the sustainability-linked bond market with investors losing interest in issuers’ KPI targets. We ask why these important sustainability targets are missing the mark and what the consequences are for the SLB market.

We also look into the problems surrounding another key element of the socially responsible bond market — demonstrating that green bonds are going to green funds.

Finally, we focus on emerging market bonds, which in terms of issuance have gone from a dreadful 2022 to smashing records so far in 2023. We investigate whether such a pace can continue after a huge week of economic data and central bank interest rate announcements and which issuers can regain access to the market.

What’s up with ECM?
European politicians suddenly love securitization again
Adani versus Hindenburg Research and what it means for Adani’s banks

The equity capital markets were supposed to have been alive with deals this January — bond markets certainly have been — but very little has happened. We investigate who is to blame and when we might see some action.

Meanwhile, European politicians and officials have stigmatised the securitization market after its part in the 2008 financial crisis. All of a sudden, as a letter from French and German politicians and leaked to GlobalCapital reveals, they agree with the banks that many of the rules that tame this market are a hindrance. We look at what they are calling for and why they’ve had such a big change of heart.

Finally, Adani Group, the Indian industrial conglomerate, has come under a short attack by activist hedge fund, Hindenburg Research. We look at what Hindenburg is alleging and Adani’s response but also what it means for the banks in the capital markets that serve Adani.

Mighty Earth vs JBS: how sustainable is the SLB market?
How the FIG and corporate bond markets are changing this year
What can put a stop to record bond issuance

The sustainability-linked bond market is a nascent one but booming. It is a controversial one too, with some accusing it of being a platform for greenwashing. Those accusations escalated this week when Mighty Earth, an NGO, made a complaint to the US Securities and Exchange Commission about SLB issuer and beef production giant JBS.

The outcome is sure to resound through this market for years to come. We examine Mighty Earth’s complaint and look at JBS’s response to it. We also talk about what the consequences might be for the wider SLB market.

Meanwhile, the primary bond market has been fizzing. It has been a record year for euro issuance, for example. We look at how the bullishness in credit is affecting issuance in the financial institution and investment grade corporate bond markets. But we also question the exuberance, whether it can last and what will derail it.

Sergiy Nikolaychuk of Ukraine’s central bank offers an in-depth look at the country’s economy in wartime
Can the good times last in the primary bond market?
Real estate looks for refi rehab and direct lenders end up as owners

Sergiy Nikolaychuk is the deputy governor of the National Bank of Ukraine, the country’s central bank. Appointed to the job in 2021, he has been at the heart of Ukraine’s financial system and economy throughout Russia’s invasion. We spoke to him in Vienna this week about how the NBU makes plans during wartime, its expectations for the conflict and how its economy and financial system has held up as well as its latest agreement with the IMF.

While Ukraine might not be able to come to the capital markets for now, bond issuers across different sectors are making the most of it. Issuance records both for individual borrowers and market sectors are tumbling just two weeks into the year. Issuers are suffering from FOMO, market participants tell us. But what else should they fear and can the good times in the bond market last? We find out.

Not every type of borrower is able to get into the market, however. Issuers from the beleaguered real estate sector have debt to refinance in the coming years but had a tough time borrowing last year. We look at the mounting problems for the industry in capital markets.

We also take a look at direct lenders who are increasingly taking the keys to the companies they have lent to that got into trouble. We look at how widespread this could become and the consequences for the direct lending market.

Why the good times in primary bond markets may not last
The consequences of the ECB’s demand that banks buffer their leveraged finance positions on LBOs
How that could play into the hands of private creditors

The first couple of weeks in January are not just among the busiest of the year in the capital markets but can also tell us a lot about the year ahead. In the first GlobalCapital Podcast of the year, we take a look across the credit spectrum from ECB rulings in the leveraged finance market to how sovereigns will fund the energy price crisis.

How bond issuance goes in January is especially important this year after such a disrupted 2022 for so many borrowers. A lot of the problems underlying bond issuers’ attempts to raise capital last year have not been solved — inflation is still high, rates are rising, recession is looming and the effects of war in Ukraine linger.

Nonetheless, issuers across the board enjoyed a strong first few days in the markets. Bigger tests are to come, however, especially once the bloated piles of cash that investors have to deploy each January start to dwindle.

Meanwhile, the ECB has increased the capital it wants banks to hold against their leveraged finance positions. We discuss how that will affect the investment banks that dominate this market, why it could play into the hands of private credit and what it means for leveraged buyout volumes this year.

In GlobalCapital's last podcast of 2022, four of our journalists pick the moments from this year that stood out most for them as important, memorable... or amusing.

We also discuss how the UK regulator is using Brexit to try and ease some of the harsh restrictions imposed on securitization by the EU since 2008 — while the EU is refusing to listen to the industry’s complaints.

In the equity capital market, there has been a burst of block trades, proving that investors have appetite — an encouraging sign for the chances of more ambitious deals next year.

And bond investors are finally getting to grips with one of the big questions in sustainable finance: how can you assess whether oil and gas companies are genuinely transitioning towards low carbon.

Will the easing of Chinese Covid rules help or harm emerging market issuers?
How public sector issuers compete with a jumbo — and growing — borrower like the EU
Private credit’s late bloom

China relaxed some of its zero-Covid policy this week, giving hope that this will stimulate Chinese growth. We explain why that will be a boost for beleaguered emerging market bond issuers and investors — and also why it might not.

The European Union completed its gigantic funding task for the year this week with a €7bn bond sale. Other SSA issuers have had to navigate around it all year as this bond behemoth must come to the market often and in size. But next year, the EU — and other sovereign issuers — are likely to have to borrow even more. We explore what is driving this and what it means for the SSA bond market.

Finally, we revisit the world of private credit and direct lending — sectors that have boomed in recent times — to see where managers are having the most success in raising cash from investors, following the successful closing of two new funds this week, and where they are struggling.

Hungary, its investors and their ESG worries
The digital bond markets take a step forward
Aroundtown drama fails to cool hot hybrid market

Hungary came to the markets this week with a privately placed increase of a dollar bond. Along with recent green bonds from the issuer, the response from some in the market was that the issuer was doing funding this way to avoid scrutiny over its standards of governance.

The country is in an escalating dispute with the EU over allowing the primacy of the rule of law, as bloc membership demands.

The European Commission has recommended freezing disbursement of funds to the country unless it makes certain reforms. If Europe's Council of Ministers votes in favour of the freeze, Hungary will be more reliant on capital markets.

We look at investors’ observations of what they think Hungary is doing and ask whether they are fair. We also discuss Hungary’s response — both to the Commission and to those investors.

We also look at the latest digital bond from the European Investment Bank — what advancements were made, what the benefits are, where digital bond issuance is headed and what could stop it from getting there.

And as the Santa rally that we first discussed two weeks ago runs on and on, we take a look at the rampant market for hybrid corporate debt and how it appeared to reach a new level of sophistication this week.

How much longer can the extraordinary run of bank bond issuance last?
Are sustainability-linked bonds too complicated to be meaningful?
New bond, old tricks: the art of underwriting returns

It has been a record November for bank bond issuance and one of the busiest months for that market ever. That is, of course, unusual. What is even more unusual is that many in the market expect the pace of issuance to run long into December.

Typically, the market dies down after the US Thanksgiving holiday at the end of November. We look into what is driving this late spree of deals and ask what might stop it.

Sustainability-linked bonds are not straightforward products and this week, one from Valeo, the French car parts maker, had investors expressing frustration. The deal itself was a success but investors are concerned about the complexity of some of the environmental targets the issuer and others like it are aiming for. They argue they lack the expertise to judge whether ambitions around emissions are meaningful. We look at their complaints and how an industry geared towards assessing financial performance can come to judge environmental progress.

Finally, we look into a bond issue from Slovenia’s largest bank, NLB. The issuer tried the deal with a syndicate of banks but postponed it only to return with the same deal one trading day later with only one lead manager mandated, which had offered to underwrite the bond. We ask whether the art of dealers buying deals is making a comeback.

Will the Santa rally in bonds last until Christmas?
How much bond issuance will TLTRO repayments drive?
Ithaca Energy: autopsy of an IPO

The first UK IPO of significance in a year might have been hoped to be a bellwether for future deals and perhaps spark a revival for listings. But the IPO of Ithaca Energy has not worked out quite as the company and its investors might have hoped with the share price tumbling. We take an in-depth look at the company and the listing to find out what happened.

In the primary bond market the tale has been, on the whole, much rosier. Investors have bet that central banks are nearing the top of their interest rate rising cycle – or at least they believe the pace of increases will slow. That means they are buying bonds again, giving a boost to the primary market. A better than expected US inflation number last week turbocharged that dynamic in this week’s primary market.

But how long can this Santa rally last? And is the market good enough for all borrowers to take advantage? We look into some of the successes and failures in the bond market this week and give the tyres on which it is rolling a thorough kicking – no reindeers were harmed in the making of this episode.

Meanwhile, the ECB is revealing data on repayments of its Targeted Longer-Term Refinancing Operations. Banks and some supranational and agency borrowers took trillions in cheap cash from the central bank but now the terms have worsened they are handing it back. A big chunk of this they will have to refinance in the bond market. We take a look at what that means for SSA and covered bond issuance.

The re-emergence of lender protection in leveraged finance
How one Korean insurance company caused chaos in Asia’s bond market
Climate resilience comes to sovereign bonds

Some serious people in the leveraged finance market believe that covenants designed to protect investors are on their way back. That would mark the reversal of a trend that has been going on for perhaps 20 years of borrowers, and the people that own them, pushing the conditions that govern their borrowing ever more in their own favour.

It is early days – to the extent some market insiders do not believe it is even happening – but we investigate this week what restraints lenders are demanding and how far they can push back with interest rates rising and recession looming.

Financial institutions’ autonomy in deciding to redeem their regulatory capital early or keep it in place is often a controversial topic. This capital is designed to be called but a borrower’s call option is just that: an option, not an obligation. Nonetheless, chaos ensued in the Asian market recently when Heungkuk Life, an insurance company, made some very strange decisions about what to do with one of its callable bonds. It was a story of how on company’s confusion spread throughout the bond market dragging in all manner of innocent bystanders.

Finally, we take a look at an announcement made at COP 27 in Egypt this week and what an effort to build climate resilience into bonds means for the small, low income countries most vulnerable to climate change.

That the asset management industry – and the financial markets at large – has a problem with gender equality and women’s participation will be a shock to no one. But a recent survey laid bare just how stark the issue is despite years of debate about how to make the business a better place to work for half of the population.

Two women with a wealth of financial markets experience joined us this week to discuss the state of the industry and what to do to improve it. Louise Wilson is the co-founder of Abundance Investment and was previously head EMEA of equity capital markets at UBS. Apiramy Jayarajah was most recently head of UK wholesale at Aviva Investors, which she joined from HSBC Global Asset Management but before that worked on trading floors at ABN Amro and Royal Bank of Scotland.

We are also right in the middle of recruitment season for those looking to get into the industry, either through internships or graduate schemes. So, we took the opportunity to ask Louise and Api what women in particular should be mindful of and what they should be asking prospective employers about a career in finance.

Who’s in
Who’s out
Who’s paying for it

Credit Suisse finally revealed its new strategy this week — breaking the firm up into three. Many of the details had been leaked in the run up to the announcement but it was no less momentous for all of that.

The Swiss firm will keep its domestic operations, wealth management and markets business. Meanwhile, it is selling its profitable but capital-hungry securitization business to investment houses Apollo and Pimco and setting up a separate capital markets and advisory business to be called CS First Boston, reviving a storied Wall Street brand much to the delight of some of its veteran deal makers.

We look into the rationale behind the plan, what businesses will thrive and what will be shut down in the new regime. We take a look at who will be running CSFB and how he will staff it given the high number of senior departures from scandal-ridden Credit Suisse over recent years. We also take a look at how the restructuring will be financed.

Will Liz Truss’s exit as prime minister be enough to calm the capital markets? What must her successor do to put the UK back on track? Plus who dares wins in corporate bonds and the far-reaching implications of HSBC ads being banned for greenwashing

Capital raising about to get tougher for companies
Chaos reigns in Gilt market

With many corporate bond issuers in Europe heading into earnings blackout periods, fears are that once they release their results in a few weeks, the negative impact of inflation, supply chain disruption and rising rates will mean lower profits.

That in turn will make capital markets tougher places to raise money. We discuss who will be hit and what they can do to issue debt in the aftermath of bad results with overall market conditions looking grim.

Speaking of grim markets, UK prime minister Liz Truss may have ditched another tax cut policy as well as her first chancellor in a bid to reassure the country of her leadership and bring stability to bond markets but the early signs are that she has failed again.

The Gilt market is "all over the shop", according to one trader, behaving much more like an illiquid, high risk market in distress - the opposite of what it is supposed to be.

Following the PIF’s debut bond, is Saudi Arabia a credible green investment?
The multitude of unusual tactics bond issuers are using to get deals done in difficult markets

The Public Investment Fund, Saudi Arabia’s sovereign wealth fund, made a huge splash in bond markets this week with its debut deal. But the $3bn sale across three green tranches, including a 100 year bond – an unprecedented feat among debut issuers – was not without controversy.

While the deal execution itself could not be hailed as anything other than a success, investors had wildly differing opinions about whether a green bond from Saudi Arabia is a credible ESG investment or not. The country is in the middle of a bold plan to transition away from oil income, which had one of the deal’s lead managers calling the 100 year piece a “bond beyond oil”, but is it doing everything it can? We examine the deal and the arguments for and against lending money to the PIF if your priorities are the environment, social wellbeing and sound governance. If anything, the deal shows there are no simple choices in ESG debt markets.

Nothing is simple in the wider bond market either, it seems. Getting deals done is tricky with markets so volatile and uncertain. There is little to suggest they will become more placid, or that funding costs will fall, any time soon either. We look at how borrowers are using all of their wiles to get funding through the door while they can.

The way out of UK market disarray
Italian banks in a better state
Bring back the bonus cap, say bankers

We analyse the disruption to capital markets this following new UK chancellor of the exchequer Kwasi Kwarteng’s plan to fund tax cuts and energy bill support through extra government bond issuance, which spread across currencies and asset classes and ended — or perhaps just paused — with the Bank of England making an emergency purchase of some of those bonds just as the government was in the market issuing some. Sovereign debt managers often tell us they like their markets to be dull and predictable — this it most certainly was not.

But where does the UK go from here? We asked the market and heard that the way out of this mess was the government’s to navigate and that it could not rely on the Bank of England stepping in to maintain orderly markets as a permanent solution.

Italy is a country that has been more closely associated with volatile politics and markets in recent times. Indeed, an election result last week drove up the spread between Italian government bonds (Buoni del Tesori Poliennali, or BTPs) and German ones — a key indicator that shows investors believe Italy is becoming a more risky investment prospect when it rises.

That in turn affects Italy’s banks, of which there are many and which are big users of the markets to raise funding and capital. But, even as one Italian bank failed to price a deal in the markets this week, we uncovered the reasons why the funding picture for this key group of institutions in the European economy is better than one might think.

And finally, back to the UK where we have gauged reaction in the markets to the removal of the bankers’ bonus cap — another policy from Kwarteng’s mini budget. Spoiler alert: it’s not what you'd expect.

Uruguay has taken a step further along its path to issuing a sustainability-linked bond, which will be something new for the market to get its teeth into. And in an extra wrinkle, the South American sovereign borrower is proposing to pay investors less if it hits certain sustainability targets.

We take a look at how near this controversial idea is to becoming reality and whether the market thinks Uruguay will succeed or fail.

Meanwhile, as we recorded the podcast, the UK’s new chancellor of the exchequer, Kwasi Kwarteng, was delivering to parliament his plans for the country’s finances. One policy he was expected to reveal was to remove the cap on bankers’ bonuses.

We explain why we think this is a good policy, even if the timing appears to be horrific for a whole host of reasons.

A number of senior bond bankers in Europe’s corporate bond market cannot for figure out why investors are buying what they have to sell.

With US inflation above expectations this week suggesting central banks could be about to raise interest rates imminently, yet again, some bankers are having a hard time figuring out why you’d buy anything now that you could buy at a much better yield by waiting a couple of weeks.

We explain how deals are getting done in such a volatile market and what is driving investors into the market when they know bigger returns could be had by waiting.

We also look at what a fresh round of investment banking job cuts in the US might bring and whether there are in fact signs of hope that suggest the cuts might not be that severe.

Finally, we talk about the drive to get bankers back to the office. It could be a handy way to prune excess staffing numbers as those who crave flexibility leave the industry but, as we discover, balancing what is best for the business with what is best for the people that make it happen is far from a settled issue.

Almost a year ago, we discussed the energy crisis for the first time on this podcast — how energy companies were using the capital markets in the face of higher demand for their product and what it meant for inflation. A year on, things are much worse.

Russia’s invasion of Ukraine a few months later has turbocharged that crisis to the point where this week governments are once again unveiling fiscal support packages to help people and businesses through. We look at where the capital markets might be used to fund the response and whether they can shoulder the burden with shrinking central bank monetary support.

But we also revisit what the energy companies — and others linked to the sector — are doing now that they are facing extreme swings in the price for gas, what it means for their finances and what they need from the capital markets to navigate through it.

And speaking of volatile markets, we discuss how one investment bank has recalibrated its primary bond business in credit markets in a way it thinks will help it to act more quickly and decisively just when such qualities may make the difference not just between winning a bond mandate or losing it but in being able to execute it without losing your shirt in the process.

Earth Wind and Fire’s September, a nostalgic paean to the joys of the first month of autumn, might strike a chord with those involved in the business of raising bonds for companies and banks this year.

Traditionally — along with January — one of the busiest months in the primary market calendar, most Septembers offer a bumper harvest of bond issuance as investors return form their summer holidays refreshed and with new piles of cash to deploy for the final quarter of the year.

But this year, things are very different. With no central bank buying to prop the market and a whole host of economic horrors facing it from soaring energy costs, inflation and the prospect of a global recession, issuers will face a far tougher time persuading debt investors to part with their money.

We examine the perils facing banks and companies for what will be one of the trickiest months of the year to see which issuers are the most vulnerable, what kind of market they will face and how they can navigate it to raise vital funding.

Perenna is a company hoping to change the way home buyers borrow money in the UK with a system borrowed from Denmark. It claims its way of lending money will make housing more affordable. We test that claim and look into how this change could affect the covered bond and residential mortgage backed securities (RMBS) markets.

With the number of publicly listed companies seemingly in secular decline, we discuss how stock exchanges and regulators around the world are competing to persuade companies to list with them — especially exciting, new tech firms. We examine what a company needs from an IPO and the public trading of its stock and what it wants to avoid, and how the various reforms are helping or hindering those aims.

We also take a closer look at the biggest market of them all, New York, which seems to be taking a rather different approach to regulation from the rest of the world and debate what the consequences of that may be.

The Rhine, which flows through Germany's industrial heartlands, is drying up and that could spell trouble for the corporate bond market.

A number of industrial giants — investment grade bond issuers with around €66bn of debt between them — all of a sudden can no longer use the river in the ways they are used to.

They are struggling to get materials in, carry out their processes and to ship their goods out. It is the second time the river has run low in just four years. The last time it was this low was over 100 years ago.

We examine what the ramifications of this will be for the companies affected and their debt and for their suppliers and customers, but also whether this is a prime example of the true costs of failing to tackle environmental sustainability — perhaps the defining long term problem facing capital markets and society at large.

Nancy Pelosi, speaker of the US House of Representatives, riled China this week by dropping in on Taiwan. The ripples of the visit spread across the Asian bond market, already suffering from myriad pressures both local and global.

Issuers pulled deals as investors worried about just how far China would go in its retaliation but it was not such a bad week for every borrower, as Singapore demonstrated. We look at how the diplomatic dispute will hurt the Asian bond market in the weeks and months ahead.

In Europe, trouble is brewing in the collateralised loan obligation (CLO) market. The investors which stump up the cash to allow issuers to put CLOs together in the first place are being squeezed to the point where it is becoming uneconomical for them to put money in. We examine the causes driving this and what the CLO market can do to overcome it and keep the deals flowing.

From the German equity capital markets, through leveraged finance, to the hairier parts of the blue chips’ balance sheets, raising capital is not easy if you’re a corporate treasurer.

We take a look at the problems hindering Frankfurt-listed companies from raising equity capital and what they propose to do about it — not to mention the perils they face if they do.

But we also look at the barren leveraged finance market. Sponsors and banks in this deal desert had found an oasis in the form of direct lenders. But now the well looks to be running dry, we investigate why and what the alternatives are.

We also look ahead to what must surely be a day of reckoning fast approaching for companies with hybrid capital — a complex type of funding designed to improve an issuer’s debt metrics and credit ratings. The market for hybrid debt has been moribund but it cannot remain that way forever. We talk about what is likely to happen when it reopens and what affect this will have on the companies that use it.

A wave of emerging market bond defaults could be about to hit, judging by where EM sovereign bonds trade against US Treasuries. But are we really looking down both barrels of a default deluge or is the situation more nuanced than the numbers suggest?

Meanwhile, one very high profile emerging market borrower, Ukraine, is asking for a debt standstill. We look through what that means for the country, its investors and its future in the capital markets.

We also look at whether multilateral development banks are going to swell their borrowing programmes in the coming years to help extend greater funding to the developing world and we also assess a momentous day in the eurozone as the ECB raised rates for the first time in 11 years but, critically, also launched its latest policy tool — the snappily named Transmission Protection Instrument.

Cryptocurrencies have had a rough time of late but they are clearly no flash in the pan. That has driven regulators to intensify their efforts to gain control over this financial frontier.

The Bank of England’s deputy governor this week sounded a warning that if the crypto world wasn’t brought under control soon, it risked suffering its own Hindenberg moment, referring to the time the famous German airship exploded ending, perhaps prematurely, the development of what could have been a useful technology.

Of course, there have already been explosions in the crypto markets but regulators are keen to find a way to bring stability to their more useful parts to allow them to flourish. We look at who is trying to bring which bits of crypto to heel and how they plan to do it.

Banks have a big part to play in this too. Following the recent release of the ECB’s climate stress test for the lenders it regulates, we discuss how banks’ involvement in the notoriously energy-hungry crypto markets should be done with the aim of greening it as it develops.

We also investigate the latest turmoil in Italian politics. Prime minister Mario Draghi offered to resign this week, sending Italian sovereign debt yields and spreads to Bunds higher, just as his former employer the European Central Bank is expected to reveal its new tool for keeping those very numbers under control. We take a look at what this means for Italy and how SSA borrowers will adapt their funding tactics to cope with ever more frequent disruption — this was not after all the first shock of the week with US inflation coming in above expectations at 9.1%.

We reveal why capital markets often barely flicker even when there is the sort of huge political disruption that took place in the UK this week, when prime minister Boris Johnson said he would resign following a series of scandals and a rebellion within his own government.

Closer to capital markets, we take a look at the next leap forward in sustainability-linked bonds. Chile may have brought the first sovereign deal but Uruguay could be next. It has been considering issuing once since not long after the first ever version of the product arrived from Italian energy company Enel in September 2019. We explain why Uruguay’s bond could be such an important one for this nascent asset class and what the consequences could be for other sovereign issuers.

We also see how a revival of an esoteric corner of the US securitisation market is helping power companies in the country increase their ESG spending and whether the same market could develop in Europe.

In the same week that the Green and Social Bond Principles provided a ton of new guidance on how to apply its formula to different types of security, which we discuss, we take a look at how the capital markets are offering investors different way to fund the green transition.

Green capital raising is a rare bright spot in the equity markets these days but it is not all plain sailing. We look at what went wrong with Plenitude’s IPO, the listing of Eni’s renewable business. It was supposed to be a banner event for the market but instead, it got pulled. The listing of De Nora, another jumble of activities under one roof with an ESG flavour, did get done. We take a look at what it takes to raise equity capital for a green company and what deals may be round the corner.

But it isn’t just public equity markets ploughing money into the green transition. Private funds are buying up various unglamourous companies — bins and buses — and helping them on their green journey. We look into what is driving this trend and what the funds’ motivations may be.

Finally, it was a shocking week in the primary bond markets with deals getting hooked left, right and centre. We reveal what market experts told us were the best ways to navigate the primary bond market when it is in this state and discuss whether a pulled deal is anything to be embarrassed about any more.

It was not that long ago that we ran a number of stories and podcast episodes about banks battling for staff so that they could get record volumes of deals through the capital markets. With inflation rampant, recession looming and interest rates on the rise, some markets have dried up as M&A grinds to a halt. Now bankers fear for their jobs, with one likening the situation to the dotcom bubble bursting two decades ago.

Tech firms don’t have to go so far back in time to recall a torrid spell in financial markets. As the world emerged from the Covid pandemic, tech companies went from being the belles of the ball to being the empty beer bottles. As their valuations plummeted, they kept away from raising equity capital. But this week, Ocado, the online grocer, brought a deal to market. We discuss why it had to come in such a terrible market, whether other tech firms will do the same and what their options are.

Finally, we discuss what went down at Euromoney’s Global Borrowers and Investors Forum this week, where the ECB’s plans to control government bond spreads was the subject of some very lively debate. We look into why some find the idea of yet more bond market intervention so objectionable.

Last week the ECB laid out its plans for its monetary policy. That surely was enough to convince bond markets that it had a grip on both rampant inflation and government bond spreads, right? Wrong.

This week it had to convene an unscheduled meeting of its governing council so that it could figure out how to manage spreads in the government bond market. Dealing with inflation is the bank’s core mission; dealing with spreads is something it has had to take on during many years of crisis. In some ways, the two objectives are mutually exclusive. So we discuss what the ECB is up to and what the consequences will be.

We also talk about the much more immediate consequences of the US Federal Reserve’s historic 75bp rise for emerging market bond issuers. Their market is shut but will that lead to financing problems for a number of economically vulnerable countries?

We also dissect what incoming EU regulations that demand investment firms get a read on what their clients’ sustainability ambitions might be for their portfolios mean for the asset management industry. This is a huge piece of rule making that will require a mountain of work on the buy-side and it is due to come into force in August. But the industry appears to be far from ready to deal with it.

We wouldn’t normally talk about a capital markets conference on the podcast but next week sees one of the biggest — Global ABS, the biggest gathering for the European securitization market — resume its pre-pandemic full, physical form at its regular haunt, Barcelona. It comes just as the securitization markets in Europe are in a rough state.

We discuss what the thousands of delegates at the meet-up will be talking about and where their market is headed — which is also the topic of our newest podcast which is about securitizaton, Another Fine Mezz, available now on globalcapital.com.

There are also changes afoot in the leveraged buyout market, as private lenders muscle in on business that has traditionally been run by banks. We examine what this means long term for LBOs.

And in the corporate bond market, we investigate the rise of the glocos — global coordinators that is, a title banks in a bond syndicate are taking on, what it means (if anything) and why the term has started to appear.

From bonds to equities, issuers are finding it harder to raise capital. Inflation, invasion and disruption, not to mention rising interest rates, are shortening the times when the financial markets are stable enough to allow issuers to come to the market with deals.

We look into what that means for the rest of the year in bond and equity markets and discover that it is forcing issuers to crowd into the same, smaller windows for new issuance than they have been used to for the last few years. We highlight the problems that will cause some of them.

We also discuss what may be something of a Martin Luther moment in socially responsible investing. Stuart Kirk, HSBC’s head of responsible investing, boldly went and named his criticisms with the ESG finance industry at an industry event recently. His critique has caused a furore in a part of the capital markets where there is often too cosy an alliance of — at least in terms of what is said publicly — bland, good intentions. We discuss whether Kirk had a point — after all, he is no global warming denier or an outsider to financial markets — and how the ESG finance sector and HSBC should respond.

There is no doubt that bond markets are becoming tougher places from which to raise money. Even in the public sector bond markets, where issuers flock in times of trouble, what are typically issuers prized for their rarity are now enjoying less demand because investors have come to value highly the ability to sell out of positions easily given the volatility.

But at least borrowers are getting their funding done there. In the emerging markets, which so often bear the brunt of capital markets and economic turmoil, there is a rather different problem. Here, issuers are having to come to terms with rising yields, widening bond spreads and no end in sight to the volatility as they face the prospect of recession, a strong dollar and rampant inflation; all of which makes life tough for them in the capital markets. On the podcast this week we question why more of them aren’t trying to do more to issue bonds before the situation grows even worse.

Elsewhere, travel and tourism sector companies have been making the most of rising passenger numbers and fewer restrictions to raise equity capital to pay down debts. But they too face risks to their recovery from the pandemic. We investigate what they are and whether their capital markets revival will be short lived.

War in Ukraine, the pandemic and the recovery from it, rampant inflation and the end of the era of cheap money — people in the capital markets have a lot to think about when allocating or raising money. But are they missing the biggest problem of all: China’s slowing economy?

A growing number of market participants think so. China as a producer of goods sold to the world and a key consumer of plenty of the world’s commodities and finished goods, is an integral part of the global economy and therefore, a driver of what is possible in the capital markets. Hopes of a revival in European stock market listings are now foundering as investors look long and hard at which companies are the most reliant on a Chinese economy dogged by lockdowns and port and factory closures.

We discuss who will be hit and how hard. We also look into how problems in other emerging market countries may effect their ability to raise funding in the bond market and where else they might go for cash instead.

We also take a look at some new bonds that were priced this week in different parts of the market and figure out what they tell us about how borrowers will have to approach a volatile bond market in the weeks and months to come.

Normally when central banks make policy decisions that they were expected to, capital markets activity carries on unencumbered. But not this week.

The 50bp interest rate increased from the Federal Reserve on Wednesday was long anticipated but while markets appeared to take the news well at first, by Thursday things had gone sour once more making issuance difficult. Certainly, there’s a lot to feel grim about in the economic realm — supply chain disruption, war in Ukraine, rampant inflation and possibly a looming recession. Meanwhile, investors and issuers are dealing with the gradual withdrawal of central bank economic stimulus.

All of that makes the capital markets a tougher place to navigate and picking the right deal to do at the right time a harder task than it has been for years. This week, we look across debt and equity capital markets to examine how they will respond and discuss whether some borrowers are in for an unduly rough ride or whether this is simply the return of the good old days when investors discerned between the good credits and the bad.

It’s not just raw materials and components that are hard to get hold of nowadays. The European leveraged finance market is bang on trend and experiencing some supply chain disruption of its own. We explain which parts of the market are just starting to work again and which are about to seize up and how that will proliferate across other parts of the capital markets.

Naturally, we also find a way to crowbar a discussion of Elon Musk’s planned purchase of Twitter into the mix and examine how the leveraged finance market might help or hinder that deal.

We also look at how the bond market for financial institutions trying to raise funding is changing. We test the idea that it may become a market of haves and have-nots in terms of cheap, easy access to bond market funding.

Then we turn to sustainable finance. We discuss how investors are making bigger demands of issuers who want to print sustainability-linked bonds and the knock-on effects this will have on their supply chains and on the products and services they produce as the capital markets learn ever more about how to account for and mitigate emissions.

It was just a fortnight ago that we reported on what could turn out to be a swathe of job losses in the equity capital markets. But all is not lost; not only are some companies readying initial public offerings to give ECM bankers something to do, for those still left wondering if they’re facing the chop next, there is a hiring spree afoot elsewhere in the capital markets. We tell you where that is and what you can expect to be paid.

That hiring spree, like everything else in the capital markets, has been driven by what central banks are up to and the effect that has on bond issuance. We saw that influence manifest in other parts of the bond market this week too and we discuss whether the differing speeds of central bank monetary policy change will make this a year one of short lived opportunities for cheap funding in different markets. We discuss what borrowers will benefit from that and what they will need to do to take advantage.

Finally we highlight a growing trend in private lending — net asset value loans made to private equity funds. It’s an old technique so why is it having such a resurgence? Subscribe to the GlobalCapital podcast at wherever you get yours from to find out.

If ever there was a week to demonstrate the interconnectedness of the international capital markets to what is going on in the rest of the world — in this case the awful events in Ukraine — this was it. On the podcast this week we follow a thread that starts with the appalling situation in eastern Europe and ends in the US securitization markets by way of looking at how companies are responding to the heightened uncertainty that the war has brought to the global economy, how it has affected their financing needs and how this is influencing the capital markets in turn.

We also discuss why so many companies are making their public bond market debuts at the moment and finally, we turn our attention to the equity markets where, again, the war in Ukraine is resulting in some interesting behaviour from sellers of large stakes in public companies — trying to hide their identity when they come to market. We examine what they are doing, why they are doing it and, ultimately, whether it is a good idea or not.

It was only recently that GlobalCapital reported on both the huge amounts of business being done in the capital markets and the tussle between banks to hire enough staff to cope with it all. Record volumes meant soaring pay, especially among the massed legions of junior bankers as firms competed for staff. But the equity capital markets in particular have just had a dreadful quarter with very few pockets of activity and some recently hectic parts of the market all but closed. Already, bankers are starting to fear lay-offs cannot be far away.

We discuss this week whether they are right to fear a wave of redundancies or whether this is a knee-jerk reaction and that business will come bounding back as markets grow used to life with inflation, the war in Ukraine and its wider economic effects.

We also highlight how certain groups of investors are returning to parts of the bond market they had abandoned for years, proving that rising rates and widening credit spreads are not all bad news for bond issuers.

For more than a decade, Europeans and Americans have only known low interest rates and central banks soothing debt markets with endless lashings of liquidity, through buying bonds. In recent years, the European Central Bank has been buying up to 40% of every corporate bond and covered bond issued in the eurozone, as well as vast quantities of public sector bonds.

But it is pulling out — meaning the euro bond market is losing its biggest investor. Can it cope? Even the best rated supranational, sovereign and agency borrowers are having a tough time — the market was so volatile this week they could no longer price deals over the usual benchmark of mid-swaps.

But lower down the credit spectrum the effects are likely to be much more painful.

The Swiss franc bond is usually a placid place, where conservative investors soberly swallow low yielding, low risk bonds. But it does contain a streak of adventure — the more gamesome investors, especially wealthy individuals investing through private banks, like to buy emerging market bonds, which provide much higher returns.

Some shine has come off this year, though. This week Russian Railways, which has issued in Swiss francs, tried to pay an interest coupon but could not because of sanctions. Russian borrowers are quite big in Swiss francs, partly because rich Russians’ Swiss bank accounts invest in the deals. Could this put Swiss investors off their emerging market food?

Listen to GlobalCapital’s podcast to find out.

A month into Russia’s war on Ukraine, capital markets are getting more used to the risk it poses, and a wider range of issuers are able to raise money. But riskier types of deal — emerging markets, high yield and equities — are still virtually impossible.

Emerging market bond issuance did resume with deals for Nigeria and Turkey, but then the brakes were slammed on again this week when Jay Powell, chairman of the US Federal Reserve, startled bond aficionados by hinting that some of the Fed’s rate hikes this year could be double-sized: 0.5% in one go. On this week’s GlobalCapital podcast, George Collard, EM bonds reporter, explains how this is affecting countries from Latin America to the Middle East, and gives an update on the efforts by Russian borrowers to pay interest on their bonds — while Western authorities try to stop some of them.

Mike Turner, public sector bonds reporter, says even some of the highest quality borrowers in the world, such as the European Union and German state bank KfW, are finding the bond market full of traps at the moment. What investors liked one day, the next they hate.

A good equity deal got done in Iceland, however, where the government sold $400m worth of shares in Islandsbanki, one of the three banks it had to nationalise in 2008. Victoria Thiele, equities reporter, asks if this could lead to more privatisations of former zombie banks in Iceland and elsewhere in Europe — such as Spain, the UK and Ireland.

Occasionally capital markets produce something truly cheering. Jon Hay, sustainability editor, explores the World Bank’s ‘rhino bond’, issued this week, which enables investors to finance rhino conservation in South Africa in an innovative way – by giving up their interest payments.

Banks might finally be held to account for the damage to the environment their bond and equity underwriting does. Elsewhere, three Russian companies might face bankruptcy thanks to the effect of sanctions on their convertible bonds.

While it has been fairly straightforward to measure what emissions a loan or an investment funds, assessing the part a bank’s capital markets deal arranging business plays in polluting the planet — working on an oil company IPO, or lead managing a bond for a mining company, say — has been harder to acknowledge.

Now, work is underway to shed light on this vital part of greening the financial system just as HSBC — a big bank in this business — committed to disclose the impact of its capital markets business for oil, gas, power and utilities clients, following shareholder pressure.

But what will these disclosures tell us? How long will they take to arrive? And most importantly, how will they get banks to reduce their impact via the capital markets?

Meanwhile, three Russian companies are facing an existential threat thanks to the convertible bonds they issued running up against sanctions. We have discussed Russian defaults on the podcast before but these companies, thanks to a combination of Western sanctions, and those of their own government, face bankruptcy if they cannot find the money to buy back the bonds they sold to investors. So far, the bondholders — who likely don’t want to or can’t own a Russian business in a different sector to their own — are working with lawyers and the companies themselves to work out how to resolve a complicated situation.

We discuss how they ended up in this mess and what the remedies may be in what is, in the parlance of our times, an unprecedented time for this part of the capital markets.

The full implications of the Russian invasion of Ukraine for the capital markets are still far from clear. As we recorded this episode, European leaders were meeting at Versailles to discuss, among other things, another gigantic borrowing programme for the EU that could be funded in the bond markets — this time to fund defence and energy. We discuss all that we know so far on this developing story and whether it will make the EU the sort of permanent capital markets presence that defines it as the eurozone’s benchmark issuer.

The EU wasn’t the only European institution considering its response, however. A key European Central Bank meeting on Thursday gave the first indication of what monetary policy makers plan to do to combat inflation now that war threatens both even greater rising costs and lower growth. The US Federal Reserve and the Bank of England will follow next week.

Closer to the eye of the storm we look at what the world’s major banks are doing about their businesses in Russia. Goldman Sachs and JP Morgan are pulling out but, as we discover, it’s not simply a case of packing up and going home when your clients are all trying to do the same.

Finally, we look into something just as complex but where there is even less transparency — whether Russian issuers will be willing and able to comply with the country’s decree that they only pay their bond obligations in roubles, whether that will result in mass defaults and what the long term implications of that will be.

The Russian invasion of Ukraine has given capital markets participants in the West compelling legal, moral and financial reasons to question, and indeed halt, their involvement in financing the country and its businesses.

Swathes of new sanctions have forbidden all sorts of financing activity, but critically, investors and companies like index providers — which provide a framework for so much investment in Russian assets — are now going beyond what is laid out in the proscriptions as they look to disentangle themselves from Russian capital markets.

The effects will likely be catastrophic for Russia, especially its equity markets. But if westerners are forced to sell their Russian assets all at once into a market with no buyers, it won’t just be Russia that feels the financial pain.

On the podcast this week, we discuss how banks, index providers and investment managers can cut their risk exposure to Russia and whether they can do it without hurting themselves in the process. We also look into whether a recent sudden interest in buying defence stocks is compatible with the sort of ESG concerns that are being given as a moral justification not to invest in Russia.

This week’s podcast was recorded the morning after Russia began a full scale invasion of Ukraine.

We look into the immediate effects on the capital markets — what the fresh rounds of sanctions means for Russian issuers and what sort of deals other borrowers will be able to do once enough stability returns to markets.

We also discuss an area of the capital markets where investors are flocking to buy deals that may turn even hotter as a result of the invasion: the IPO market in the Middle East.

The remedy recently imposed upon BNP Paribas for a sexual discrimination case it lost in 2019 could have far reaching effects on the gender pay gap and for transparency over incomes — one of the City’s great taboos — more broadly.

Not only did the French bank have to pay Stacey Macken, who won the tribunal, over £2m in compensation but it has been instructed to conduct a pay audit that will see it produce pay data for all of its London branch staff — from the canteen to the C-suite, via the trading floors — to show whether it is paying people fairly in relation to each other and the jobs they do. No other company has been instructed to do this before though some have done it voluntarily.

Should the data reach the public domain, then it will offer great insight into what BNP Paribas pays and for what jobs. That data will be valuable to BNP Paribas’s many rivals but should they be thinking about doing a pay audit themselves in an effort to narrow the gender pay gap, pay staff fairly relative to each other and to head off grievances and embarrassing public tribunals brought by their own staff? We discuss the implications.

We also take a look at an eye catching piece of debt issuance by Turkey — a country with $11bn to raise on the debt markets this year but whose access to those already volatile markets has been complicated by rampant inflation and unorthodox monetary policy. Turkey’s debt officials have found a way to bring a blockbuster deal to complete over a quarter of that funding task in one fell swoop. Listen in to find out how they did it.

Meanwhile, as the IPO market finds its feet again, we discuss what deals will work and what won’t; and finally, we investigate the gigantic problem looming over government debt markets in some parts of the eurozone and what the ECB will do about it.

Salomon Brothers is back. One of the most storied names of 1980s Wall Street, immortalised in Michael Lewis’s book Liar’s Poker is a registered trademark once again and is planning to get into the financial markets.

Travelers Group swallowed up the original Salomon Brothers in 1998, a firm which merged with Citi in the same year. Citigroup finally dropped the Salomon brand — by then Salomon Smith Barney — 19 years ago.

There are some people around the capital markets today who worked at this legendary firm though, as the years go by, more people will have learned about it through books like Lewis’s than through encounters with its former staff. So what is behind the revival?

This week on the podcast we look into who is behind the venture and what they might do with the business. We also ask which famous but defunct City or Wall Street brands might be next.

We also discuss the Bank of England’s plans to unwind corporate quantitative easing and the bond market’s reaction to it. We also examine how the rest of the primary bond market is adjusting to a world where interest rates are almost certainly on their way up for the long term — a set of circumstances that a whole generation of capital markets practitioners, just like working in a world where Salomon Brothers exists, has not experienced before.

Much of the focus in capital markets is on what central banks — and subsequently, issuers of both debt and equity — will do next. We discuss how those policy decisions will affect issuance in the capital markets this year. But meanwhile, a situation is brewing between Argentina, which is in no position to issue debt at all, and the IMF that could have huge repercussions for not only both parties but also the country’s bondholders.

Argentina is no stranger to debt restructuring, the IMF or default. This time, the country owes the Fund $45bn as part of an agreement to help it out of an economic crisis from 2018. That crisis came after Argentina had spent a fleeting but glorious spell as a bond market darling after years locked out of debt markets thanks to a previous default. For a short while, the sovereign, its regional governments and other borrowers printed bonds like there was no tomorrow. When the economic reforms required to sustain such a debt pile failed to materialise, the inevitable happened and Argentina was back at the IMF for funding as it battled with bondholders over what it owed.

Fast forward to this year and Argentina has reached an “understanding” with the IMF over a new funding package. Perhaps just as well given Argentina is supposed to pay around $3bn of that $45bn by the end of March at a time when it is running low on dollar reserves and has few ways of generating them.

But an “understanding” of “key principles” is a long way from a final agreement and as always in Argentinian debt negotiations, things are never run smooth. For a start, there are doubts that the possible funding package will help Argentina avoid another debt restructuring in 2024 in any case. Moreover, for an IMF prescription, the package seems unusually light on economic reform, leading to some speculation that securing this agreement is as vital for the Fund as it is for Argentina. And then of course, there is the political dimension, with the financial “understanding” triggering the resignation of a key political figure in protest this week.

We discuss whether that is political posturing or a genuine threat to the IMF and Argentina’s chances of reaching an agreement and what implications that might have for the country and its creditors — both from the official sector and the capital markets.

We also examine how the EU has perhaps scuppered its own plans to guide investors towards sustainable investing and we look at whether banks are worried about lending to Russian clients as the country’s stand-off with Ukraine runs on.

Compensation is up across the board for investment banking staff and bankers in the capital markets. But where do you have to work to make the big bucks? The GlobalCapital Podcast reveals the answers.

We talk about pay levels — salary and bonus — throughout the ranks and which bits of the bank pay the best to work in. We also talk about what different shops pay and where to locate yourself for the best chance of making top dollar… or euro, or pound.

But are the rising compensation levels sustainable? What will happen once investment banking and capital markets activity slows? All this and the rest of the most interesting stories from the capital markets in this week’s episode, including good news (at the time of recording) from Russia and Ukraine, the beginnings of what could be a rush of oil and gas companies coming to the equity capital markets (be sure to listen to the previous episode for more), plus the new twist on an old trick that Deutsche Bank is pushing to some of its corporate bond issuing clients.

Last week on the GC Podcast, we questioned whether we had passed the high point of bond market madness — the sorts of new issues that left some market participants wondering why anyone would buy a deal on such parsimonious terms as they watched many more pile in regardless. This week, there was mounting evidence to suggest we had.

Top rated issuers in the SSA and covered bond markets found themselves locked out of longer dated debt — at least at terms they would be happy to pay — as benchmark government bond yields rose further still. Inflation is persistent; even the ECB now thinks so as it revealed in the minutes of December meeting this week. There is no doubt that investors are expecting rates to keep rising and that is driving them into ever more defensive deals at short maturities.

In emerging markets, it is not just the rates picture that is troubling issuers and investors. Russia’s threat to Ukraine and a number of more localised concerns mean that issuers that have mandated banks to bring bonds to market are waiting before doing so. As they watch from the side lines, they will have seen some deals struggle this week while other issuers paid a large premium to issue. Is wating for things to get better a policy that will prove penny wise but pound foolish?

In equity markets, however, there might be a golden chance for capital raising for heavy polluting companies from the oil, gas and mining sectors — and possibly the last one they will ever have. We explain the factors behind that as well as discuss how the IPO market will look for them and everyone else this year.

Finally, and perhaps to redress the ESG balance, we examine a new way to get private capital from the rich world into the developing one in a scheme that may solve one of the biggest riddles in development finance.

The primary bond market was going gangbusters this week. January is always a busy month but, so far, this one feels busier than others.

Bond markets have run on central bank fuel in the form of low rates and quantitative easing for years. That has led to some startlingly low yields and an era of cheap borrowing. But with rate rises on the way to combat inflation, there is a very real sense that this could be the end of an era.

Amid the flood of new bond issues, issuers are grappling with how to keep lure investors into allowing them to lock in low rates just as the era of cheap money looks set to end. Meanwhile, investors are asking themselves what it would take for them to buy certain bonds that pay what are obviously meagre yields now, let alone how they will compare once rates rise across the board.

All of that has led to some interesting dynamics across the sovereign, supranational and agency, financial institution, corporate high yield and convertible bond markets. The success of some of the deals issued this week looks, at first glance, to be completely counterintuitive, that is until you take a closer look.

On this week’s podcast, we take that closer look to see what is driving bond issuance, whether we witnessing the final throes of the age of cheap money, and how that might affect the rest of the year in the primary capital markets

January is invariably one of the busiest months in the capital markets calendar for new issuance as borrowers race to get ahead of their funding plans, and those of their rivals. So far this year, it has been no different with huge volumes of bond funding raised across different markets. But underlying the buoyant conditions is a sense of unease that they might not last forever.

This week, we looked at what is causing that unease — from the spectre of rising interest rates and the tightening of central bank monetary policy, to inflation, to protests in Kazakhstan and what risks they pose to other parts of the emerging markets — and how that will affect borrowers looking to issue debt this year.

We also delve into the latest controversial iteration of Europe’s Taxonomy for sustainable activities and how this might affect the sustainable finance market.

This week was an important one for the primary capital markets, even if there was very little, if any, issuance. The US Federal Reserve, the Bank of England and the European Central Bank all made key monetary policy decisions that laid the ground for what is traditionally one of the busiest months for capital raising all year — January — and beyond.

We focus on what the ECB said about its plans for bond buying and how this will impact bond markets at the start of next year, particularly for public sector borrowers. The central bank looks to be winding down its Pandemic Emergency Purchase Programme. Knowing that central bank support for the market is going, public sector issuers, which have been the main beneficiaries of the Pepp, will look to get more funding done than usual at the start of the year before the ECB winds down its buying under the programme in March.

But the ECB is mitigating that withdrawal of support by deploying its firepower in different ways. We discuss what these are, how they will affect the capital markets, and which borrowers will benefit.

First the UK and now the EU have embarked upon a review of whether the way IPOs are done on their turf is fit for modern markets or not.

With €93bn-equivalent raised through IPOs so far this year in EMEA — a number only equalled in the last 21 years in 2007 — there seems to be a case for streamlining the way deals are done and making the market cheaper and more accessible.

But IPO volumes vary from year to year — it will not always be this busy. Will the reforms under discussion be beneficial in the long run?

Market participants often hail the way IPOs are conducted in the US because they are perceived to require a lot less work. But does that make for a better market with better outcomes for investors and issuers?

On the podcast this week, we discuss what changes have been made in the UK and the EU, what may lie in store, and what market participants want to see from a reformed market for listings on the eastern side of the Atlantic.

A fertile hunting ground for signs of major shocks affecting capital markets is invariably the parts where the worst rated credits are — where risk is deemed to be highest. That typically means the emerging markets and, as was our subject this week, the leveraged finance market where the most indebted companies raise debt capital.

The recently detected Omicron variant of the coronavirus is already having an effect on the latter. Three huge financing deals that have been in the pipeline for months are now quite likely to be shoved into next year because investor confidence has ebbed away.

Typically, banks with huge leveraged finance debt positions to sell don’t like holding on to them over Christmas, but that now looks like it will be the case. On the podcast this week, we examine how they have ended up in this situation and what the consequences are likely to be.

Meanwhile, we also discuss credit investment firm Alcentra, which has been put up for sale by its owner, BNY Mellon.

Turkey has once again defied monetary policy orthodoxy by cutting interest rates in a bid to tackle inflation, which is running at around 20%. The results on the country’s currency, the lira, have not been pretty and it has plummeted in value. But what does that mean for the country’s access to capital markets? This is, after all, a sovereign borrower with a big presence in bond markets and the country’s banks and companies also rely on international funding.

We discuss why the reaction to the interest rate cut in the bond market was muted but highlight the risks that loom large for Turkey’s capital markets.

Meanwhile, the self-styled “CEO of El Salvador — its president Nayib Bukele — is attempting what might generously be called a novel form of sovereign financing. He wants to issue a $1bn bond that pays out based on the performance of Bitcoin. And he wants to use some of the proceeds to build a new city… called Bitcoin City… at the foot of a volcano…

We deliberate over whether this is a good deal for investors or not (spoiler alert: we don’t think it is) and what Bukele might be up to.

We also discuss the latest findings from our survey about life in the capital markets after Covid and how it has affected banks’ attitudes to diversity.

The way people did business and went about their work in the capital markets changed almost overnight in early 2020 with the advent of the coronavirus pandemic — and in ways many would have previously thought impossible.

Gone were the gruelling roadshows and short haul business trips as deal marketing went online. Gone too was the need to be present in the office or on the trading floor. Compliance and technological worries were swiftly overcome and record volumes of capital markets business were done despite the chaos that the pandemic brought.

Now, as working conditions normalise, it is time for the industry to assess what it will keep from the pandemic experience and what it has missed the most from before. Many bankers have long since resumed normal office working but many expect — and are being given — a greater degree of flexibility. But how much flexibility is the right amount?

Ultimately, capital markets are about relationships. How will building and managing those change now there is a clear expectation that there will be less business travel in the future?

We discuss the findings of the survey and what will the lasting changes be to working life in the capital markets.

If the COP 26 conference on climate, which concludes this week in Glasgow, has had a consistent theme, it has been trying to agree how much funding the developing world needs from the rich one to combat the most severe consequences of climate change, and how to make sure that funding gets there.

In this week’s podcast we examine some of the smart and innovative ways capital markets can help bring about climate adaptation in the developing world, and how institutions like development banks can help to mobilise the billions — perhaps trillions — of dollars necessary to prevent a global catastrophe from both public and private purses.

Like some kind of location scout for a Bond film, we start in the coral reefs of Belize and move to Washington DC’s corridors of global power before considering which other exotic but threatened countries can benefit from global capital flows looking to have a positive impact on the developing world and climate change.

It’s half time in Glasgow at the COP 26 conference where the world has gathered to thrash out the next steps in the fight against climate change. GlobalCapital, which has been reporting from the front lines of ESG finance since the concept’s inception, has boots on the ground at the event (and not on the other side of Scotland, like CNN) while we have also been involved in a special collaborative project with our sister publications in the Euromoney Institutional Investor stable to bring you — completely free — the most important news, analysis and opinion from the capital markets; banking and finance; and the legal, insurance and tax sectors among others around the latest developments in Glasgow and from the wider green transition (go to euromoney.com/COP26 for more).

On the podcast this week, we discuss the GFanz initiative — Mark Carney’s $130tr plan to fund the green transition — and what it can and can’t achieve. We examine the UK’s plans to force companies to consider their path to net zero and we look into one of the biggest problems facing COP 26: funding the developing world through the climate crisis.

Finally, we take a look at what the second week of COP 26 holds in store.

With record amounts of issuance in the equity capital markets, dealers and issuers have become increasingly reliant upon cornerstone investors to ensure their deals get done.

A cornerstone investor — one that commits to a large chunk of stock in an IPO before book building begins in exchange for a full allocation of shares — should bring several benefits to a new listing by removing some of the underwriting risk, encouraging other investors to join the deal and in some cases helping the stock to perform once it has been priced.

But many market participants have complained that you can have too much of a good thing. Plenty of IPOs are being cancelled, postponed or are bombing in the secondary market regardless of cornerstone participation. Yet that is causing bookrunners to sign up ever more cornerstones in deals where they previously would not have been required. This, the critics say, prevents true price discovery, makes stocks illiquid and is inherently unfair, among other bellyaches.

On this week’s podcast, we discuss the extent of the problem, what can be done about it and what sort of deals need and could do without cornerstone buyers.

Will capital markets convert to using blockchain-based systems? Will digital currencies replace conventional ones? These questions have been in the air for a long time, but the uncertainty is fading. Increasingly, it looks like the answer to both will be yes.

Two experiments this week bring those prospects nearer. SG’s Forge subsidiary has begun a repo transaction on tokenised covered bonds, conducted wholly on the blockchain. And Euroclear and the Banque de France have been war-gaming a whole range of transaction types.

Meanwhile, the meteoric growth in stablecoins means they are becoming some of the largest owners of short term securities, such as commercial paper and government bills. Fitch thinks they could overtake conventional money market funds in the CP market. Is this a good idea, given their unregulated nature and history of faux pas?

Listen to our podcast for an update from the digital front line from Lewis McLellan, Bill Thornhill and Frank Jackman.

Energy suppliers and customers are facing mounting costs thanks to the rocketing price of gas. Heavy demand, particularly from China, combined with low storage in Europe has meant scarcity, which has driven up prices.

In the UK, where residential energy customers benefit from a price cap, many smaller energy suppliers have gone out of business finding themselves unable to pass on rising prices to end customers. These seemingly unprofitable end customers have now been passed to the big suppliers — those big enough to rely upon capital markets for funding.

This week, GlobalCapital looks at what that means in capital markets both for the big energy suppliers and what it tells us about something everyone in financial markets is thinking about: the future path of inflation.

The ECB’s Pandemic Emergency Purchase Programme (Pepp) is set to end in March. It has been spectacularly successful in suppressing European government bond spreads at a time when those sovereigns have had to raise more money than ever to fund their way out of the pandemic. Naturally, the looming deadline has market players worried about what will happen to the yields of countries such as Spain, Italy and Greece. The ECB this week appeared to leak a proposal for what comes next. On the podcast this week, we discuss the merits not just of that plan but of the timing of the messaging, which came right in the middle of a volatile period for bond markets and rising yields. Is the message now more important than the policy?

Keeping with European sovereigns and the pandemic, we also discuss the latest move in Poland’s ruck with the EU over the precedence of the rule of law and whether the country will see any of the billions in EU funding it is hoping for and what that might mean for bond markets.

Equity markets have been on a tear since an initial tumble when the coronavirus pandemic began. Lashings of central bank support for markets, optimism over the recovery, emergency balance sheet repair and issuers and sellers taking advantage of rocketing valuations have kept developed market valuations climbing. It has become a very crowded trade, with investors bemoaning the amount of work they are being asked to do to keep up just to pay top-end prices.

But there may better opportunities in emerging market equities. Famous investor Jeremy Grantham of GMO picked the asset class as one to watch at the start of the year. In truth, performance has been mixed since then across different emerging markets. But some, such as Russia, are booming with stellar index performance and plenty of supply. We look at what is driving the surge and what opportunities it may present.

Capital markets around the world had to get up to speed quickly last week with Evergrande, the huge Chinese property developer teetering on the brink of default on $20bn of dollar bonds and some $280bn of other liabilities including renminbi bonds. In this week’s GlobalCapital podcast, GC Asia editor Rashmi Kumar and Latin American bonds reporter Olly West explore the possible outcomes, including a shock to China’s ultra-important property sector, to confidence in the Chinese financial system, and possibly to appetite for emerging market debt around the world.

The twin influences of the pandemic and the EU continue to form the size and shape of its biggest bond market — that for government debt.

There are signs that the spike in bond issuance driven by the pandemic will start to fall now the recovery is underway. But it’s not all about supply and demand with public debt such a hot political issue within the EU.

As the pandemic took its toll, the more frugally minded member states had to pause their demands for fiscal prudence. They’re back on the case now — with one very large, notable exception — and are pushing for what they argue will be a more responsible approach to borrowing and spending.

On this week’s podcast we ask how that and other political spats across the EU from west to east are dictating the path of the government bond market.

Every constituent of the capital markets is eager to be seen considering the environmental, social and governance impact of their activities. The private equity industry is no exception. But while it may well be able to screen what it buys as far as the E and G of the ESG trinity are concerned, it sometimes struggles with the S. That’s because the consequences of a PE buyout of a company are often job losses and lower benefits for the least well off workers. Does that mean that the PE business model is antithetical to socially responsible investing? Or are the buyout barons doing society good by improving the assets they own? And how can they better manage their impact — something that will surely be a business advantage while socially responsibility is such a priority in capital markets?

A surge in capital markets business following the pandemic has caused a bidding war for junior bankers – those in the first few years of their careers, who can execute deals, if not necessarily run a business yet. At the same time, investment banking is no longer the tallest tree in the career forest for the ambitious. Banks must now compete with all sorts of other employers for the best and brightest. The result has been a rush to get enough bankers in through the door to cope with business. That means soaring pay for bankers at the start of their careers but where will it all lead? And what happens once the dealflow dries up?

For a market so well supported by central bank bond buying, there have been some strange dynamics at play in European corporate debt of late. In some corners of the market, deals have struggled and yet just this week a borrower brought a deal in the sort of size you would normally expect to see in a busy September, not while everyone is supposed to be at the beach in August. The monster order books of just a few months ago seem to be a thing of the past and yet businesses pummelled by the pandemic are printing bonds with record low coupons. What is going on and what does it mean for when the market gets busy again in the autumn?

Across the world’s financial centres, summer interns and graduate trainees are taking their first steps in investment banking. This year too, one bank has welcomed school leaver apprentices to its front office for the first time. There is no doubt that that marks a huge change in how banks recruit junior staff, which for years has been defined by hot pursuit of those with elite academic credentials. But has the jobs market changed? Is investment banking still the draw it was or are those embarking on their careers today after something more than a big income and a storied City or Wall Street name on their CVs? And are the banks themselves looking beyond their traditional hunting grounds for the next generation of MDs, rain makers and masters of the universe?

Despite a lot of excitable talk about the tapering of central bank asset purchases around the world earlier in the year, the ECB this week gave the capital markets a clear indication that the direction of its monetary policy would remain extremely loose. The Frankfurt-based institution has tweaked not only its inflation target but its forward guidance, which outlines how it plans to achieve this. We discuss what that means for borrowers and investors in the capital markets.

The direct lending market in Europe, where funds lend directly to companies rather than through a bank intermediary, has blossomed over the last decade or so, giving businesses that typically cannot issue bonds access to an alternative source of capital to bank funding, which itself has not always been easy to come by. Direct lenders, for their part, have attracted investment from all manner of institutional investors looking for juicier returns than they can find in public markets, while offering the companies they lend to a deep, long-term lending relationship. But with yields vanishing across capital markets, just how are direct lenders maintaining returns and are their end investors paying enough attention to the risks they are taking on?

Both the ECB and the European Commission this week revealed plans to influence and direct the path of the booming sustainable finance markets. The central bank has made fighting climate change a central part of its monetary policy thinking, while the Commission wants to tackle a wide range of sustainable finance activity from regulating ESG themed issuance, to ratings agencies and more besides. But is more regulation helpful or a hindrance? Will the measures proposed make much difference? And will they happen quickly enough?

The EU has made a strong start to funding its €800bn Next Generation EU programme in the bond market. It will be printing an awful lot of bonds over the next few years, way beyond what a supranational would usually issue and bringing the sort of volume more typical of a sovereign borrower. It is only supposed to be a temporary measure to fund the pandemic recovery but now people are wondering if the EU shouldn’t issue of this sort of volume permanently, becoming the eurozone’s safe asset in the process. This week GlobalCapital discusses whether that is likely, necessary, or desirable and what the implications might be.

The demand for sustainable finance has exploded in the last few years. It is a hotbed of innovation as debt issuers look to make the most of investors’ desire to fund a better world. This week GlobalCapital considers one of the most recent innovations: sustainability-linked debt. The format is simple; a borrower pays more or less on its debt depending on whether it meets certain sustainability targets. But two deals this week highlighted some of the controversies this nascent market faces over its credibility.