CORP SNAPSHOT: Blank start to 2025

SSA issuers have wasted no time in tapping the primary bond market on the first trading day of 2025 with three out across euros and sterling, but so far corporate borrowers are keeping their powder dry.

With just a short two-day week, many market participants are extending their seasonal holiday period and bridging into next week, which is when we instead expect IG corporate issuance to get underway for the year.

It is unlikely to be until Tuesday though, with Monday marking the Epiphany holiday in parts of Europe which historically keeps euro supply off the menu.

More broadly, we expect another typically bumper January, with the month traditionally marking one of the highest for issuance across the year.

It is usual for automakers to kick off the year’s euro IG/split-rated corporate bond activity and we expect it to be no different in 2025.

RCI Banque, the financing arm of French borrower Renault group, has opened up the market in each of the last seven years and so they look a safe bet to get us underway, whilst in the previous two years RCI has been joined by peer Toyota Motor Corporation.

The blank start start to 2025 comes after falling rates and underlying yields tempted a host of corporate (ex-HY) to tap the euro market in 2024 and resulted in the sector seeing its third-highest annual supply haul on record.

As a reminder, the final total finished up at EUR362.75bn, having only been beaten by the EUR381.562bn in 2019 and the all-time high of EUR443.5145bn in 2020 when issuers were flocking to the market amid the Covid-19 pandemic.

Corporates in turn contributed to a yearly single currency total across all asset classes of EUR1.491tn, the highest ever, having beaten the previous record of EUR1.485bn set in 2020.

For more takeaways from a bumper 2024 for single currency corp activity, see CORP VIEWPOINT: Another bumper year for bond issuance despite headwinds.

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