---
title: "SSA and Financials: Weekly Market Update"
url: https://www.helaba.com/en/ssa-and-financials-weekly-market-update-26
type: dd_research
language: en
updated: 2026-09-28
keywords: Renten, Weekly Market Update_englisch
---

# SSA and Financials: Weekly Market Update

Focus on: SSA & Financials 27 October 2022 © Helaba | Research & Advisory | 27 October 2022 1 of 8 Research & Advisory Weekly Market Update Primary market environment: As expected, the ECB's Governing Council today raised the three key interest rates by 75 bps each to counter the record high inflation in Europe. The previously attractive conditions for TLTRO III will be adjusted. The maturities from the bond holdings will continue to be reinvested and there will be no QT for the time being. With a slight delay, the currently brighter sentiment is also visible in our risk trend indicator. However, a general trend reversal cannot yet be assumed. The past weeks have been too volatile. . Primary market barometer The rally in government bonds had a positive effect on SSAs overall. As a result, the supra spread vs. govies narrowed moderately. As it is cur- rently a buyer's market, the right price and the right maturity remain important parameters. Covered bonds continue to meet with sufficient demand from investors. However, it seems that the times when almost every issue was a sure- fire success are a thing of the past. The trend towards higher new issue premiums has continued recently. The difficult market environment and the selective approach of investors are most strongly reflected in this segment: Although the primary mar- ket remains open, both pricing and maturities are crucial for success. In the coming week, the reporting sea- son will also weigh on activity. Covered Bonds Senior Unsecured SSA Risk trend indicator illustrates short-term easing Spread trend indicator\*, ASWspread change versus … \*ASW levels standardized and 2T-smoothed, since 14.2.22 changed calculation of ASW levels by Markit. Sources: Refinitiv, Helaba Research & Advisory IB OXX EUR O 1 day 1 week 4 week 13 weeks 52 weeks 104 weeks Germany -0,15 0,12 0,64 0,80 -1,48 -1,97 European Union -0,10 -0,15 0,79 0,98 1,55 1,12 Germany Covered -0,19 -0,32 -0,15 -0,36 0,27 -0,36 EU Covered -0,05 -0,06 0,01 -0,03 0,27 0,09 Banks senior preferred -0,04 0,22 1,10 1,54 3,23 2,16 Banks senior bail-in (SNP) -0,07 0,13 1,00 1,59 3,30 2,01 Banks subordinated -0,10 -0,08 0,36 1,21 2,89 1,66 Supranational -0,10 -0,15 0,40 0,32 0,83 0,19 Agencies -0,09 -0,03 0,55 0,23 -0,47 -0,99 Sub-Sovereigns Germany -0,05 -0,01 0,10 -0,35 -1,17 -1,76 Sub-Sovereigns -0,09 -0,05 0,46 0,10 -0,04 -0,87 strong middle weak unchanged weak middle strong spread widening spread tightening Focus on: SSA & Financials – Weekly Market Update © Helaba | Research & Advisory | 27 October 2022 2 of 8 SSA In the SSA segment, a slight improvement in sentiment can be observed. But that is all. Once again, the past few trading days have shown that a lot depends on the issuer's name, the pricing and, above all, the chosen maturity. The two securities placed by the EU in the auction procedure with maturities until 2026 and 2037 went through as usual, even though the book-to-cover ratios (B/C) of 1.6 and 1.8 respectively were not very generous for these names. The Communauté française de Belgique tried and failed to buck the prevailing trend towards shorter maturities by choosing a maturity of 17 years. The bookbuilding already in progress was stopped in view of a sparse order book and the issue was cancelled altogether. Outlook: After the ECB is before the Fed and BoE. In addition, regional holidays will be celebrated in Germany next week, so that primary market business will be very limited. Covered Bonds Compared to the previous week, primary market volume in the period since Monday has fallen to around half. In view of the restraint in the run-up to the ECB meeting, however, this development is not surprising. The new issue premiums, which averaged 6.6 bp, were conspicuous among the issues carried out. The 5-year covered issue of Sp Mortgage Bank had the longest maturity this week. It was not possible to narrow the marketing spread. With an order book of EUR 815 million, the EUR 750 million tranche barely crossed the fin- ish line. This example shows once again that the marketing of the formerly very popular 5-year maturity band has become a challenge. Especially when, as in the case of the issuer mentioned, volume optimisation was obviously in the foreground. With a view to the secondary market, it should be noted that the approaching year-end is con- tributing to the illiquidity of the market. Other issues, such as the flared-up dispute between France and Germany on important EU topics, are a warning to be cautious. In the end, everything is somehow connected to everything else, which is also noticeable in covered bonds. From the point of view of our trading, defensive action, now across the entire curve, is preferable. Outlook: The central bank meetings (Fed and BoE) in the coming week as well as the holiday-related absence of some market participants limit the primary market activity. Nevertheless, there are already some issues in the pipeline. Coupon Issuer Rating (M/S&P/F) Volume € Tap Maturity Launch-Spread vs. Mid-Swaps ESG Launch Orderbook 1st Spread- Indication 0,000% EU Aaa /AA+/AAA 2,450 M rd.  06.07.2026 Auction 24.10.2022 3,800 M rd. Auction 0,400% EU Aaa /AA/AAA 2,499 M rd. 04.02.2037 Auction  25.04.2022 5,000 M rd. Auction 5,250% Istituto per il Credito Sportivo - /BBB-/- 0,300 M rd. 31.10.2025 ms +190 Bp  24.10.2022 0,390 M rd. ms + 245 area n/a Communauté française de Belgique A2 /-/- postponed 02.11.2039 BGBs +49 bp  25.10.2022 0,375 M rd. BGBs +49 area Sources: Bloomberg, Helaba DCM € SSA issues week of 24 October 2022 „The sharply tightening spreads between swaps and bunds are increasingly leaving their mark on the swap spreads of covered bonds! As a reminder: for many months, due to historically high yield spreads between the swap and the Bund curve, the relative value of Coverds was very attractive. This has changed noticeably in recent trading sessions. The secondary market is now like the eye of a needle through which everyone wants to pass, and in one direction. The short and medium ends, which have been strongly supported for a long time anyway, no longer seem to be completely immune either.” Translated with www.DeepL.com/Translator (free version)he spread ." Comment from the Helaba trading floor Focus on: SSA & Financials – Weekly Market Update © Helaba | Research & Advisory | 27 October 2022 3 of 8 Senior Unsecured The primary market for senior unsecured bank bonds continues to be open, as the last few days have shown, but the environment remains challenging and both pricing and not too long maturities are crucial for success. So far this week, three EUR benchmark transactions have come to market despite the black- out period during the quarterly reporting season. Caixa Geral de Depósitos from Portugal, rated BBB by the agencies, was able to generate a 3.2 times oversub- scribed book with its senior preferred bond, albeit with relatively low volume and a substantial risk premium. Raif- feisen Switzerland also had to offer a relatively high spread for its first senior non-preferred bond to fill the books. Comparatively successful, in our view, was the senior peferred issue of the well-established AA-rated Sven- ska Handelsbanken. All three transactions had an average maturity of 5 years. The reporting season has so far produced surprisingly solid re- sults for the banks, with the rapid rise in net interest income in the changed interest rate en- vironment being particularly pleasing. However, investors are also extremely nervous about the quality of the loan books and immediately dismiss any signs of weakness (e.g. Santander, SEB). Demand for mortgage loans is already weakening noticeably, which is driving margin competi- tion. This contrasts with a strong increase in lending to compa- nies, which are building up their working capital and drawing liquidity lines in the crisis-ridden business environ- ment. Coupon Issuer Rating (M/S&P/F) Volume € Tap Maturity Launch-Spread vs. Mid-Swaps ESG Launch Orderbook 1st Spread- Indication 3,125% Sp M ortgage Bank Plc - /AAA/- 0,750 M rd. 01.11.2027 ms +20 Bp 24.10.2022 0,815 M rd. ms + 20 area 3,050% Bank of Nova Scotia Aaa /AAA/AAA 2,000 M rd. 31.10.2024 ms +12 Bp 24.10.2022 2,450 M rd. ms + 14 area 3,000% AXA Bank Europe SCF Aaa /-/- 0,750 M rd. 03.11.2026 ms +16 Bp 25.10.2022 0,975 M rd. ms + 17 area Sources: Bloomberg, Helaba DCM € Covered Bond issues week of 24 October 2022 „Markets are currently disconnected as there are the very positive equity markets (DAX above 13,100) as well as significantly narrowed iTraxx indices (-13 bps yoy 10/20-22 in Senior Financial), while the cash market con- tinuously recorded wider spreads and traded very sluggishly. In the cash segment, spread widening averaged 10 bps on preferred bonds, with German banks and the Scandinavians underperforming due to pressure on the curves implied by new issues. The periphery held surprisingly stable. Non-preferred bonds saw spreads widen by an average of 15 bps during the last trading week. Einschätzungen aus dem Handelsraum der Helaba Banks tighten their credit standards ECB Bank lending survey: Kreditvergabestandards\* \* Rise is net tightening Sources: ECB, Refinitiv, Helaba Research & Advisory -20 -5 10 25 40 -20 -5 10 25 40 12/11 13/03 13/07 13/11 14/03 14/07 14/11 15/03 15/07 15/11 16/03 16/07 16/11 17/03 17/07 17/11 18/03 18/07 18/11 19/03 19/07 19/11 20/03 20/07 20/11 21/03 21/07 21/11 22/03 22/07 22/11 Enterprises Consumer credit House purchase Focus on: SSA & Financials – Weekly Market Update © Helaba | Research & Advisory | 27 October 2022 4 of 8 At the same time, banks are noticeably tightening their lending standards, as evidenced by the October results of the ECB's Bank Lending Survey published on Wednesday. Institutions blame this primarily on the risks associ- ated with the gloomy economic outlook. Added to this are the increased refinancing costs and their own balance sheet restrictions. Together with its monetary policy decisions today, the Governing Council announced that interest rates for the third series of targeted longer-term re- financing operations (TLTRO III) will be adjusted and that banks will be granted additional dates for voluntary early repayment. From November 23, 2022 until the maturity or early repayment of the respec- tive outstanding amount, the interest rate will be based on the average of the relevant key ECB interest rates over this period. Details are to follow in a press release at 3:45 p.m. According to our understanding, the favorable inter- est rate for the banks from the TLTROs thus ceases to apply. According to our observations, the institutions had used the instrument mainly for welcome additional income in the low-interest rate environment and the pan- demic. Funding requirements played a rather subordinate role for many banks. However, this does not apply to all banks; for issuers from the periphery in particular, the changes could result in additional demand for capital mar- ket funding. The favorable conditions of the program have recently come under criticism in view of the rapid rise in interest rates, especially as banks are already recording substantial increases in net interest income from their customer business (especially deposits). The Governing Council has also decided that the remuneration of mini- mum reserves will be reduced from the main refinancing rate to the deposit rate. Overall, the Council argues that it wants to ensure consistency with the general monetary policy normalization process through the measures. In doing so, it arguably accepts the loss of confidence associated with unilaterally changing the conditions of an on- going program. Outlook: In addition to the difficult market environment, the blackout period due to quarterly reports will result in comparatively low activity on the primary market for senior unsecured bank bonds next week as well. Furthermore, the year is well advanced and many banks have largely implemented their issuance plans, in some cases even ex- ceeding them. Issuance in this segment is increasingly regulatory-driven (MREL/ TLAC), and issuers are turning to cheaper funding to cover refinancing needs due to the high risk premiums. Coupon Issuer Rating (M/S&P/F) Volume € Tap Maturity Launch-Spread vs. Mid-Swaps ESG Launch Orderbook 1st Spread- Indication 5,750% Caixa Geral de Depósitos, S.A. Baa2 /-/BBB- 0,500bn 31.10.2027 ms +275 bps  24.10.2022 1,600bn ms + 295 area 3,750% Svenska Handelsbanken AB Aa2 /AA-/AA+ 0,750bn 01.11.2027 ms +85 bps 25.10.2022 1,300bn ms + 105-110 bp Sources: Bloomberg, Helaba DCM € Senior preferred issues week of 24 October 2022 Coupon Issuer Rating (M/S&P/F) Volume € Tap Maturity Launch-Spread vs. Mid-Swaps ESG Launch Orderbook 1st Spread- Indication 5,230% Raiffeisen Schweiz Genossenschaft - /A/A+ 0,500 M rd. 01.11.2027 ms +220 Bp 24.10.2022 0,550 M rd. ms + 220 area € Senior Non-preferred issues week of 24 October 2022 TLTRO`s by settlement date bn EUR Sources: ECB, Helaba Research & Advisory 0 200 400 600 800 1000 1200 1400 0 200 400 600 800 1000 1200 1400 Redemption 28th June 2023 Focus on: SSA & Financials – Weekly Market Update © Helaba | Research & Advisory | 27 October 2022 5 of 8 Short news 10/27 ECB raises key interest rates by 75 bps: The Governing Council decided today to raise the ECB's three key interest rates by 75 basis points each. It also ends the favorable conditions on the third series of targeted longer-term refinancing operations (TLTRO III) as of November 23, 2022. 10/26 BdB on sustainable investment: Although more and more investors want to invest as sustainably as possi- ble, there is still a considerable need for information on the term "sustainable investment". These information gaps need to be closed because the commitment of private investors is also important in order to restructure the entire economy in the direction of sustainability, says the Association of German Banks (BdB). 10/25 ECB Bank Lending Survey results: Credit standards for loans tightened due to risks to the economic out- look and monetary policy normalization, according to the euro area bank lending survey published by the Euro- pean Central Bank (ECB). Results also show that corporates’ loan demand rose, driven by higher input costs and working capital needs. 10/21 EBA to scrutinize banking book models amid macro turmoil: Europe’s top banking regulator will more closely scrutinize banks’ interest rate and credit risk modeling practices after macroeconomic stresses have caused bankers to lose faith in the accuracy of their internal models. “We will have questions for the banks,” Del- phine Reymondon, head of the liquidity, leverage, loss absorbency, and capital unit at the European Banking Au- thority (EBA), tells Risk.net. 10/20 ECB to warn of risks in its opinion on Spanish tax proposal: The European Central Bank (ECB) is set to warn of the adverse impact on Spanish banks' solvency of a proposed tax on the sector and of a higher cost of credit in an upcoming non-binding opinion. "Attention will be drawn to the adverse impact on solvency and to risks for the transmission of monetary policy, as higher taxes could lead to an increase in the cost of loans," one of the sources told Reuters. Issuer Date Issuer Date NATWEST GROUP PLC 10/28 INTESA SANPAOLO 11/04 BANCO BILBAO VIZCAYA ARGENTA 10/28 ERSTE GROUP BANK AG 11/04 BNP PARIBAS 11/03 SOCIETE GENERALE SA 11/04 RAIFFEISEN BANK INTERNATIONA 11/03 BPCE SA 11/04 ING GROEP NV 11/03 Sources: Bloomberg, Helaba Research & Advisory Reporting dates of selected banks Focus on: SSA & Financials – Weekly Market Update © Helaba | Research & Advisory | 27 October 2022 6 of 8 \* Closing prices from the previous day Sources: Refinitiv, Helaba Research & Advisory, \* ASW-Spreads Market Data (current\*, vs. 1 week, vs. 4 weeks) E-STOXX 600 Banks 128 1,42% 6,49% iBoxx € Cov. Germany 1,3 -0,8 1,0 iTraxx Senior Financial 122,9 -14,6 -25,0 10Yr-Yield 2,12 -0,25 -0,02 iBoxx € Cov. Bonds 11,0 -0,3 2,2 iBoxx € Supranational 5,5 -1,03 6,27 Swap 10J 2,97 -0,28 -0,11 iBoxx € Banks PS 103,0 3,4 23,5 iBoxx € Agencies -13,6 -0,92 10,65 iBoxx € Germany -68,6 0,01 13,75 iBoxx Banks NPS 153,6 1,4 27,4 iBoxx € Sub-Sov. Germany -0,5 0,67 3,55 iBoxx € EU 12,2 -1,66 10,61 iBoxx Banks Subordinated 248,6 -8,2 12,3 iBoxx € Sub-Sovereign 17,5 -0,25 7,11 Leisure tip for the weekend: Lorsch Abbey in Lorsch Do you have ideas for leisure tips? We would be happy to receive your suggestions at research@helaba.de. Source: https://kloster-lorsch.de/en/welcome Lorsch Abbey- Founded in 764, Lorsch Abbey inspires with its diverse history. The King's Hall of the former abbey and the archaeological remains of the monastery complex are among the rare late Carolingian buildings still pre- served in their original appearance. A magnet for the public is also the Lau- resham Experimental Archaeological Open Air Laboratory. It is the ideal model of a Carolingian manor house with residential and farm buildings as well as gardens, meadows and fields. There one can expierence vividly how the every- day life of the people felt like about 1,200 years ago. A trip on the last sunny weekend in October is worthwhile before the open-air laboratory closes until February. The authentic experience of early medieval life provides a new ap- proach to our history for young and old! More information: Welcome - UNESCO WELTERBE (kloster-lorsch.de) Focus on: SSA & Financials – Weekly Market Update © Helaba | Research & Advisory | 27 October 2022 7 of 8 Chartbook SSA, Covered Bonds, Senior Unsecured Senior Primary volumes Senior Unsecured: Spread development EUR benchmark issue volume cumulative by weeks, bn EUR ASW spread, bp Sources: Bloomberg, Helaba Research & Advisory Sources: Bloomberg, Helaba Research & Advisory 0 10 20 30 40 50 60 70 80 90 100 0 10 20 30 40 50 60 70 80 90 100 1 4 7 10 13 16 19 22 25 28 31 34 37 40 43 46 49 2021 Senior Preferred 2022 Senior Preferred 2021 Senior Non-preferred 2022 Senior Non-preferred 0 50 100 150 200 250 300 0 50 100 150 200 250 300 Okt.21 Dez.21 Feb.22 Apr.22 Jun.22 Aug.22 Okt.22 Banks Subordinated Banks Senior Bail-in Banks Senior Preferred Covered Primary volumes Covered Bonds: Spread development EUR benchmark issue volume cumulative by weeks, bn EUR ASW spread, bp Sources: Bloomberg, Helaba Research & Advisory Sources: Bloomberg, Helaba Research & Advisory 0 20 40 60 80 100 120 140 160 180 200 0 20 40 60 80 100 120 140 160 180 200 1 4 7 10 13 16 19 22 25 28 31 34 37 40 43 46 49 2022 2020 2021 -4 -2 0 2 4 6 8 10 12 14 16 -4 -2 0 2 4 6 8 10 12 14 16 Okt.21 Dez.21 Feb.22 Apr.22 Jun.22 Aug.22 Okt.22 EUR Covered Covered Germany SSA: Primary volumes SSA: Spread development EUR benchmark issue volume cumulative by weeks, bn EUR ASW spread, bp Sources: Bloomberg, Helaba Research & Advisory Sources: Bloomberg, Helaba Research & Advisory 0 50 100 150 200 250 300 350 400 0 50 100 150 200 250 300 350 400 1 4 7 10 13 16 19 22 25 28 31 34 37 40 43 46 49 2020 2021 2022 -25 -15 -5 5 15 25 -25 -15 -5 5 15 25 Okt. 21 Dez. 21 Feb. 22 Apr. 22 Jun. 22 Aug. 22 Okt. 22 Sub-Sovereigns Agencies Supranationals Sub-Sovereigns Germany Focus on: SSA & Financials – Weekly Market Update © Helaba | Research & Advisory | 27 October 2022 8 of 8 News from Research & Advisory  FOCUS ON: CREDITS - PRIMARY MARKET UPDATE EUR BENCHMARK BANK BONDS: Q3 2022  FOCUS ON: CREDITS - EUR CORPORATE BONDS: PRIMARY MARKET Q3 2022  FOCUS ON: CREDITS – BANK AND COVERED BOND PROFILES GERMANY  FOCUS ON: SSAS – GERMAN AGENCIES  FOCUS ON: COVERED BONDS – EUROPEAN COVERED BONDS: CENTRAL WEBSITE PROVIDES CLARITIY  FOCUS ON: CREDITS – LIVE DEALS – A USEFUL INDICATOR FOR PLANNING ISSUANCE  FOCUS ON: CREDITS – EUROPEAN BANKS: CLIMATE RISK STRESS TEST HIGHLIGHTS NEED FOR FURHTER ACTION  EUROPEAN BANKS: ACTIVITIES BECOMING EVER GREENER  IMPLEMENTATION OF THE EU COVERED BOND DIRECTIVE: SPAIN VERSUS FRANCE AND GERMANY (VIDEO)  IMPLEMENTATION OF THE EU COVERED BOND DIRECTIVE – STATE OF PLAY: AUSTRIA VERSUS FRANCE AND GERMANY (VIDEO)  IMPLEMENTATION OF THE EU COVERED BOND DIRECTIVE – STATE OF PLAY IN FRANCE AND GERMANY (VIDEO)  COVERED-BOND-LAWS: IMPLEMENTATION OF THE EU REGULATION (VIDEO) Team of authors Publisher and editorial office Helaba Research & Advisory Editor: Stefan Rausch Corporate Research & Advisory Responsible: Dr. Gertrud R. Traud Chefvolkswirtin/ Head of Research & Advisory Neue Mainzer Str. 52-58 60311 Frankfurt am Main T +49 69 / 91 32 - 20 Internet: www.helaba.com Disclaimer This publication has been prepared with the greatest care. However, it contains only non-binding analyses and forecasts of current and future market conditions. The information is based on sources which we consider to be reliable, but for whose accuracy, completeness or up-to-dateness we cannot assume any liability. All state- ments made in this publication are for information purposes only. They must not be understood as an offer or recommendation for investment de- cisions. Here you can subscribe to our newsletter: https://news.helaba.de/research/ Dr. Susanne Knips Senior Credit Analyst T 069/91 32-32 11 Sabrina Miehs, CESGA Head of FI & SSA Research Senior Advisor Sustainable Finance T 069/91 32-48 90 Christian Schmidt Covered Bond & SSA Analyst T 069/91 32-23 88

SSA: Price and maturity remain important parameters. Covered Bonds: Trend towards higher new issue premiums continues. Senior Unsecured: TLTRO III changes decided by the ECB Governing Council only partially lead to increased demand for capital market funding.