CEEMEA OPEN: Lithuania, MBH Bank land deals
- Cash USTs have cheapened overnight, erasing some of Tuesday's richening, although overall moves have remained rather limited amidst a lack of meaningful headline drivers. The 10yr yield rose as high as 4.5966% vs yesterday's 2.5wk nadir (4.53%).
- Trump hinted at a 10% tariff on China over drug concerns and criticized the EU as unfair, warning of impending tariffs. He is also reportedly eager to renegotiate the USMCA trade deal with Mexico and Canada ahead of its 2026 review, potentially replacing it entirely.
- Brent is steady around $79.23/brl. Israeli PM Netanyahu announced a major military operation in Jenin, Palestine to "eradicate terrorism," resulting in at least ten deaths and dozens injured, just days after a Gaza ceasefire. Meanwhile, Trump reversed Biden-era sanctions on Israeli settlers in the West Bank.
- Mar25 Bunds and OATs are mixed in Asia-Pac trade, with the former underperforming, down 18 ticks at worst.
- European equity future markets are mixed, with the DAX outperforming (+0.47%). US equity futures point north, led by the Nasdaq mini (+0.69%). Asia-Pac cash equity is mixed, Hang Seng is down on 1.65% as Trump continues to threaten China with tariffs.
Fresh in the CEEMEA Pipeline
- There are no new additions to the pipeline.
On the Radar
- Having process quickly through the pipeline, a EUR2bn Reg S (Company 1) dual tranche issue is now priced for The Republic of Lithuania, rated A2 (stable) by Moody's, A (stable) by S&P, and A (stable) by Fitch, in the following format:
- EUR 1bn 5yr (Jan-2030) at m/s+60bp, in from the revised guidance of m/s+60-65bpsa. The deal attracted over USD2.05bn in demand (peaked at USD2.3bn), excluding JLM interest.
- EUR 1bn 15yr (Jan-2040) at m/s+125bp, in from the revised guidance of m/s+125-130bpsa. The deal attracted over USD2.6bn in demand (peaked at USD2.7bn), excluding JLM interest.
- Additionally, MBH Bank Nyrt, rated Baa3, stable (Moody’s), has landed a EUR750m Reg S 5yr (Jan-2030) Senior Preferred issue at m/s+300bps, in from the m/s+235bpsa IPTs. The deal attracted over EUR1.4bn in demand, including EUR100mn in JLM interest.
- Still on the sidelines, Orlen S.A, rated A3 (stable) by Moody's and BBB+ (stable) by Fitch, the largest multi-utility group in Central Europe, organised a series of fixed income investor calls yesterday (January 21) to advertise a debut USD benchmark Reg S Senior Unsecured 10yr bond.
Priced Deals
Date | Issuer | Ccy | Amount (m) | Coupon | Maturity | Yield | Spread | IPTS to Pxd | Book size (m) | Coverage | NICs |
21-Jan | MBH Bank Nyrt. | EUR | 750 | 5.250 | 29/01/2030 | 5.358 | M+300 | -25.0 | 1400 | 1.87 | |
21-Jan | Republic of Lithuania | EUR | 1004 | 2.875 | 28/01/2030 | 2.975 | M+60 | -10.0 | 2050 | 2.05 | 0 |
21-Jan | Republic of Lithuania | EUR | 1000 | 3.625 | 28/01/2040 | 3.777 | M+125 | -20.0 | 2600 | 2.60 | 0 |
What to watch on Wednesday
- In CEEMEA,the data slate kicks off with the S. African December CPI print (8GMT), seen accelerating to 3.2% y/y and 0/3% m/m vs 2.9% and 0% previous. The core print is seen rising a touch to 3.8% y/y and 0.2% m/m from 3.7% and 0% prior, respectively.
- In addition, Polish Avg Gross Wages, Employment, Sold Industrial Output, PPI (all at 9GMT), S African Retail sales (11GMT) and Russian CPI WoW (16GMT).
- In the US, just the MBA Mortgage Applications (12GMT) and Leading Index (15GMT) is on tap.
- Central bank speakers to talk today include ECB's Villeroy (9.15GMT), Knot (10.30GMT), Lagarde (15.05GMT) and Nagel (18.30GMT).
Wider market Sentiment
- USD Index at 108.20
- UST 2yr/10yr at 4.278%/4.584%
- Bund 2yr/10yr at 2.209%/2.508%
- Brent at $79.02/brl
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