Data provided by Dealogic
The bar graphs below illustrate the trend in the growth and trends in corporate bond issuance in the euro-denominated bond market.
i) HY Corporate Bond Issuance Since 2003
The low rate/yield environment along with a low default rate since 2009 have given confidence to investors to push down the credit curve as corporate bond yields have declined in the investment grade market. The disintermediation trend has been witnessed in this market too, such that HY issuance has averaged almost Eur47bn per year since 2013, with 2014’s record year for issuance of €57bn – finally surpassed in 2018 – and in spectacular style.
MiFID II is HERE
ii) Monthly HY Corporate Bond Issuance
|∑ = 57.12||∑ = 48.55||∑ = 48.98||∑ = 75.02||∑ = 34.12|
|Avg = 4.76||Avg = 4.05||Avg = 4.08||Avg = 6.25||Avg = 2.84|
The stand-out primary market in 2017 was the high yield market. Anyone fretting about the so-called wall of funding that might impact borrower refinancing levels (2018-2020) ought to have their concerns assuaged by the record €75bn of issuance in 2017.
This market is also the outstanding primary market story for 2018 so far. The interest for primary high yield is as good as it has ever been. There might have been a wobble on the sentiment front through Q4 2017 as investors showed some concern on secondary valuations and we had some pushback, but there are no such concerns now. We still have Monday’s session to come to add a little more to that total. Year to date, as we close out the first four months of 2018, has us at a stunning €30.48bn of issuance.
Our January 2018 forecast for the full year of issuance to come in at around €55-60bn is already at risk.
For fully searchable individual HY deal data, click here.