As the Covid-19 crisis rages on, it is separating whole business securitizers into two groups - ones that have seen their revenues steadily improve from their pandemic lows and those that are struggling to stay afloat.

Uncertainty about this part of the ABS market has already led to a huge drop in whole business ABS issuance this year, with volumes year to date at just US$1.94bn, down from the record US$9.1bn seen in 2019, IFR data show.

Indeed, for weaker issuers like gym operator Planet Fitness, tapping this corner of the ABS market for funding - even in the current climate of historic low interest rates and overall huge appetite for ABS - poses a challenge.

"A slow recovery and same-store sales underperformance by some issuers could continue to put pressure on ratings, and impede issuers’ ability (and need) to obtain more term debt through the whole business ABS market," Wells Fargo analysts said in a recent report.

Planet Fitness is one such example....

Goldman Sachs made about US$100m from a series of trades involving Tesla in recent months, according to sources familiar with the matter, as it capitalised on a steep rise in the electric carmaker’s share price this summer that helped fuel a broader surge in US stock markets.

Bankers in Goldman’s equities trading division were behind a range of lucrative Tesla-focused transactions, including trading Tesla stock options, providing financing secured against shares in the company, and buying and selling its convertible bonds, according to the sources.

Those deals helped Goldman produce stand-out equities trading results in the second quarter in particular, sources say, when the bank reported revenues from equity trading approaching US$3bn – its best quarter from that business in over a decade.

The trades also reveal how one of the world’s most prominent financial institutions joined investors both big and small in profiting from the dizzying climb of one...

Digital Debt Capital Markets has closed a second round of funding, raising £4.32m from a group that includes fintech entrepreneur David Rutter and Michael Spencer's private investment group IPGL.

The fintech firm is building a platform called agora that its co-founders - debt market veterans Charlie Berman and Naveed Nasar - say will cut the costs of producing bond new issues. DDCM raised £2.5m a year ago in seed funding that included Spencer - former owner of NEX Group (previously ICAP).

DDCM said it has made significant headway over the past year in developing end-to-end digital support for the entire life cycle of a bond, working to connect agora with issuers, underwriting banks, custodians, central securities depositories, issuing and paying agents.

It said it has completed in-house testing and initial development of first phase software and is now completing the necessary technology.

Rutter is founder and chief executive of R3, which is behind Corda...

Rabobank's new sustainable financing framework raises the game for financial institutions issuing ESG debt by clearly identifying the investments that it will finance upfront in response to investors’ calls for greater transparency.

The move puts sustainability at the heart of the Dutch bank’s funding programme and will allow its treasury to give investors more detail when issuing a range of sustainable debt and prepare its balance sheet for looming EU regulation.

Rabobank has created four new "sub-frameworks" that detail the eligible proceeds for each sustainable fundraising from the outset, rather than issuing generic ESG-labelled deals with a mixed use of proceeds that offer investors’ little visibility beyond an annual report.

Each issue will fund only one of the sub-frameworks: renewable energy, green commercial real estate, healthcare and care facilities and Covid-19 crisis support to SMEs. This separation allows investors to assess materiality and...

Bank of China priced the world's first blue bonds from a commercial bank with a US$942m-equivalent dual-currency deal to support ocean conservation.

Through its Paris branch, the A1/A/A rated Chinese lender priced US$500m of 0.950% three-year blue bonds last Monday at 99.694 to yield 1.054%, or Treasuries plus 90bp, the tight end of final guidance of 90bp–93bp and well inside initial 130bp area guidance.

BOC's Macau branch also priced Rmb3bn (US$442m) of two-year blue bonds in the Dim Sum market at par to yield 3.15%, 35bp tighter than initial 3.5% area guidance.

Blue bonds are a relatively new sustainability instrument, and BOC's deal is the first public offering in Asia. Early pioneers include the Nordic Investment Bank and the government of the Seychelles, which launched the concept in 2018 with the help of the World Bank.

BOC's US dollar tranche was well received by global investors with nearly half of the bonds allocated to EMEA investors, an...

Shares in Readly International rose strongly on their Stockholm debut on Thursday, after the digital magazine platform completed a SKr720m (US$81.6m) IPO.

Shares peaked at SKr66.91, up 13.4% from SKr59 IPO pricing, before easing off in the afternoon to SKr65 by 4pm in London, up just over 10%.

The performance comes after the IPO drew SKr5bn in demand, with the public tranche more than 10 times subscribed, excluding shares acquired by eight cornerstone investors that took about half of the deal.

The offering, which was a mix of primary and secondary shares, had a book of 200 institutions, 45% of which were zeroed. Readly now has 25,000 new shareholders thanks to the retail component.

Strong tech demand came from the US and UK, as well as Continental Europe and Sweden, despite bookbuilding beginning on September 8, the day after the US Nasdaq dropped 4% amid a global tech sell-off.

"The quality of the cornerstone investors, and the ability to find a...

Scentre Group took a big step towards repairing its battered balance sheet with a US$3bn (A$4.1bn) two-part subordinated 144A/Reg S offering that underlines investors' confidence in the long-term prospects of Australia’s largest shopping mall owner.

The US$1.5bn 4.75% 60-year non-call six and US$1.5bn 5.125% 60-year non-call 10 hybrid notes priced at par, well below low 5% and mid 5% initial price thoughts, having attracted hefty respective order books of US$4.5bn and US$5bn.

UBS was structuring adviser and joint bookrunner with ANZ, BNP Paribas, CBA, Citigroup and HSBC. The notes will receive 50% equity credit from the rating agencies and are not included as liabilities for Scentre’s bank and bond covenants.

“Investors appreciated the relatively high yield that the subordinated structure offers for an investment-grade instrument from an investment-grade issuer that underpins Scentre’s strong, long-term balance sheet position,” according to Ian Campbell, head...

Novartis became the second corporate in a week to issue a sustainability-linked bond, though the product continues to draw criticism from some investors who question its efficacy in improving ESG standards.

The Swiss pharmaceutical company printed a €1.85bn eight-year sustainability-linked bond, also known as a KPI-linked bond, on Wednesday.

It followed a US$750m 10-year SLB from Brazilian pulp and paper company Suzano last Thursday. They are first two such bonds issued since the format was debuted by Italian power producer Enel a year ago.

"Investors were clearly interested in this deal, looking at the book, and certainly the structure itself attracted attention," said a banker.

Novartis attracted €3.75bn of orders, which enabled leads to revise pricing to 40bp over swaps from IPTs of 55bp area.

That final level, though, still meant that Novartis paid a spread over its conventional September 2028s, which were bid at 25bp before the new issue's...

Volkswagen got a rapturous response for its long-awaited debut green bond on Wednesday, as investors put aside any qualms over the company's past performance with the deal more than five times subscribed.

While Daimler beat its rival to the punch by becoming the first German carmaker to issue a green bond through a transaction earlier this month, VW's €2bn dual-tranche deal was still an important milestone for the European corporate market given the company's history.

Earlier this year VW said that the emissions scandal of 2015 had cost it some €31bn in fines and settlements.

Yet any fears that investors are still mistrustful of the company can be cast aside. Just like Daimler, VW was able to price its green bonds inside fair value, though bankers say it's hard to pinpoint just how much the green label is responsible for that.

"The bond market is insanely hot at the moment," said a lead on the VW deal.

That aside, there were other technical reasons...

Munich Re made a dramatic entry into the green bond market on Tuesday with a debut Tier 2 offering, a deal that emerged against a buoyant backdrop for issuance in the format.

Insurance companies have increasingly been turning to green debt as they look to bolster their ESG credentials, but remain relatively rare in the format.

In the case of Munich Re, the deal was not only its debut in the format but was also the first from a German insurance company.

"There's a huge amount of liquidity and the market is clearly feverish for ESG product," said a syndicate banker on the trade.

Following some swift but efficient investor work, leads Citigroup, Credit Agricole, Deutsche Bank, Goldman Sachs and HSBC started marketing the long 20-year non-call 10 at 190bp area over mid-swaps.

"It's a great name, everybody likes Munich Re. They have a super high solvency ratio, which clearly investors like," said a banker away from the trade, adding that it would be...

Novartis looks set to become only the third issuer of KPI-linked bonds, injecting some vim into a product that was at one stage lauded as 'the next big thing' in sustainable finance.

The Swiss pharmaceutical company (A1/AA-) has appointed JP Morgan as structuring agent, along with Barclays, HSBC and Societe Generale as lead managers, to arrange investor calls starting today, September 15, with the intention of bringing an eight-year senior unsecured euro-denominated bond to market in the latter half of this week.

Sustainability-linked bonds, also known as KPI-linked bonds, are tied to companies' ESG strategies via key performance indicators. A failure to hit KPIs results in the bonds' interest payments stepping up.

The supply of sustainability-linked bonds has lain dormant in Europe since Italian utility Enel raised US$1.5bn and €2.5bn through separate issues of the instrument in September and October of last year.

Last week, however, some signs of life...