November 28, 2017 / 4:08 PM / a year ago

NRW, Ludwigshafen price aggressively

LONDON, Nov 28 (IFR) - The SSA market is still going strong with the German State of North Rhine-Westphalia and the City of Ludwigshafen both pricing aggressively, and Bank Nederlandse Gemeenten announcing a new mandate.

NRW drew books of €3bn, sizing its five-year transaction at €2bn and setting the spread at 24bp through mid-swaps - a tightening of 2bp. Leads were Barclays, DekaBank, Deutsche Bank, DZ Bank and Nord/LB.

“There’s a certain tolerance from investors versus sub-Libor returns given the flow established by the ECB,” said a lead.

“You have to ask yourself if you want to put your money to the ECB at minus 40bp or maybe a German Bundesland, which is perhaps less of a loss.”

A lead away from the deal commented that the result was very good.

“It’s a tricky maturity, but it clearly worked very well.”

Ludwigshafen tightened significantly to swaps plus 22bp from high 20bps, allowing it to up the sizing to €150m from €100m via DekaBank, DZ Bank and UniCredit. Books for the 10-year Stadtanleihe closed above €160m.

The name is a good opportunity for investors to diversify, said a lead.

“The market is stable, although many investors are now sitting on very good performances and are wary of taking risks. They’ll buy anything that’s attractive, but will let pass normal trades that are at very tight levels,” he said.

Another issuer gauging investor interest this week is the Dutch public sector agency BNG. It has mandated Daiwa, RBC and TD to arrange a series of one-on-one investor calls beginning today for a new, US dollar Sustainability transaction.

The proceeds of the three-year will be utilised for lending to the Dutch Housing Associations according to BNG’s Sustainability Framework for Dutch Housing Associations.

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