Record European bond sales kick off 2025 as borrowers capitalize on tight spreads

Investing.com -- A record-breaking number of borrowers flocked to the European bond market on Tuesday, looking to capitalize on near three-year low spreads. According to data compiled by Bloomberg, 28 issuers are seeking to raise at least €30.4 billion ($31.7 billion), a number expected to increase as the day progresses. This marks the highest number of borrowers in a single day in the past decade.

The European primary bond market began to heat up on Tuesday, following a period of relative quiet during the New Year's holiday and Epiphany celebrations. The surge of activity follows a record year of new issuance in 2024, with borrowers attracted by the tight spreads, which denote the compensation investors demand over a benchmark rate.

Marco Baldini, global head of investment-grade syndicate at Barclays (LON:BARC ) Plc, attributed the high level of issuance to the timing of the holiday season. He also noted that investors, flush with cash, are ready to accommodate new issues.

Several banks, including Barclays Plc, BPCE SA, Natwest Markets Plc, Nationwide, and Commerzbank AG (OTC:CRZBY ), are introducing new deals. Food and beverage giant Nestle SA (SIX:NESN ) is aiming to raise an expected €1 billion from a seven-year offering and a rare 20-year issue. Additionally, Renault SA (OTC:RNLSY )'s financing company is pursuing a three-year deal, and Enel (BIT:ENEI ) SpA is offering a two-part hybrid bond.

Companies have been quick to tap the market early this year, aiming to get ahead of earnings blackout windows that start later in the month.

In the government bond sector, Hungary, Slovenia, and Belgium have launched sales. Chile is also in the mix, seeking to raise funds through a euro-denominated social bond.

Looking ahead, further deals are anticipated. German airline Deutsche Lufthansa AG (OTC:DLAKY ) and chemicals manufacturer Evonik Industries AG (ETR:EVKn ) have already announced plans for offerings in the coming days.

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Source: Investing.com