Bank bond issuance increases ahead of stress test results

12 July 2010

Bank bond issuance hit its highest point since mid-April last week as financial institutions in Europe look to raise funding ahead of the publication of the stress test results conducted on them.

According to figures from Dealogic, €18.4 billion ($23.1 billion) worth of bonds were sold – up on the €4.8 billion recorded the week before.

The likes of BNP Paribas, Barclays and HSBC were among the banks involved with the issues, reports the Financial Times.

Myles Clarke, head of the bond syndicate desk at Royal Bank of Scotland, said that such firms are looking to make the most of improving investor sentiment before the stress test results come out.

"There's such an overhang of issuance that needs to get done this year that if last week's deals continue to perform well, you'll see bank after bank coming to this market," he added.

Last week, the EU confirmed that 91 banks will have the results of stress tests conducted upon them made public.

By Tony Aynsley

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