Spanish companies welcomed again by the markets and foreign investors

By Tania Suárez, in Madrid | Thanks to the current environment of improved trust and confidence levels, Spanish companies and banks have reopened the primary market. Santander was the first one, followed by Sabadell, BBVA, Banesto and Telefónica. Repsol and Ferrovial joined to this debt issuing, and it is expected that Pescanova will be the next one. Some experts see the European Central Bank’s open bar of liquidity, together with the new Spanish banking sector reform, as the reason why Spanish banks and companies dare to take the plunge into the primary market. And they have succeeded: the demand has been much higher than expected, and they obtained a 43.5% of the market issuance volume up to date in 2012.

It’s especially significant the step forward of Spanish banks, because they have been out of the primary market since last spring (specifically since April 12), almost a whole year of severe drought. Now they are back, and they are strong: together they’ve sold €5,7bn.

Santander placed €2bn in covered bonds on February 1, after a high demand of €8.5bn. Investors from Germany, Austria and Switzerland bought 34% of those covered bonds, Spain 27%, UK and Ireland 15%, and France 7%, among others.

Sabadell sold €1.2bn of 3-year covered bonds, and the surplus demand forced the bank to expand a 140% its original amount. The investor coupon reached 3,625% (250 basis points over benchmark interest rates).

BBVA placed also €2bn (193 basis points over midswap) of 18-months senior debt, in spite of receiving requests valued at €3bn. Finally, Banesto sold €500mn of 4-years covered bonds, 235 basis points over midswap.

About the Author

The Corner
The Corner has a team of on-the-ground reporters in capital cities ranging from New York to Beijing. Their stories are edited by the teams at the Spanish magazine Consejeros (for members of companies’ boards of directors) and at the stock market news site Consenso Del Mercado (market consensus). They have worked in economics and communication for over 25 years.

1 Comment on "Spanish companies welcomed again by the markets and foreign investors"

  1. geeee! We, the people, hope to get some taste of those good news, just a little slice of that wonderful welcome they are receiving… They are so good and generous, why were they being left aside in this wonderful market of ours??! It´s true: the average spanish keept them far from it… Gosh, we are so lazy, good god, thanks we have Santander, BBVA, Sabadell… Long live to Botin! Let´s make him president…

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