The waiting games: ME issuance, digital capital markets and French covered bonds

So George, good news from the Gulf this week, with the US and Iran agreeing basically a 60-day ceasefire, which sounds a bit more exciting than a memorandum of understanding.

But anyway, that's hope that that will lead to a permanent peace deal after this sort of two month period.

And that should be good news for the bond market, of course, where Middle East issuers have been somewhat at base since the war began at the end of February, as it should be more stability and therefore better issuance conditions.

But just how subdued has it been the

last few months? it's been pretty quiet.

There have been deals, but there was a long pause during March and into April when no Gulf issuers came to the public bond markets.

I think it's important to stress the public markets because there was a big spate of private issuance that has continued.

It's still going on.

So some of the biggest, highest rated issuers in the region like Kuwait, Abu Dhabi, Qatar, they've been doing big private placements.

But that obviously has an impact on the public issuance volumes, which are a little bit down year on year after what was a pretty spectacularly busy January and February.

Okay, then.

So how has the, I guess, the credit landscape changed in the Middle East as far as capital markets are concerned? Because some credits have had a sort of a better war than others, if that's not a terrible way to put it.

Yeah, if you compare now to the end of February, it's not actually looking that much different.

Gulf spreads, they blew out in March, understandably.

Immediately after the war, there was a big sort of knee-jerk sell-off, pretty much across the board to varying degrees.

But it's more or less rallied.

There are some spreads that are tighter than they were before the war.

I think that the obvious and big exception to that is the real estate companies, particularly the privately owned ones.

Some of them have government ownership, but a lot of them are private.

And they suffered really quite nasty sell-offs in March.

Their yields went hundreds of basis points higher rather than sort of tens like for some of the more higher rated issues.

And that's partly because, you know, a lot of them are below investment grade.

They're the kind of rare sub-investment grade issues from that part of the world.

The obvious reason for that is people have got worried about expats leaving the gulf because of the attacks from iran worried about people not wanting to move there in future worried about tourism that sort of thing but on the whole the you know the picture isn't actually that much different now they've been extraordinarily resilient even their

spreads have tightened back in a bit though haven't they

So George, good news from the Gulf this week, with the US and Iran agreeing basically a 60-day ceasefire, which sounds a bit more exciting than a memorandum of understanding.

But anyway, that's hope that that will lead to a permanent peace deal after this sort of two month period.

And that should be good news for the bond market, of course, where Middle East issuers have been somewhat at base since the war began at the end of February, as it should be more stability and therefore better issuance conditions.

But just how subdued has it been the

last few months? it's been pretty quiet.

There have been deals, but there was a long pause during March and into April when no Gulf issuers came to the public bond markets.

I think it's important to stress the public markets because there was a big spate of private issuance that has continued.

It's still going on.

So some of the biggest, highest rated issuers in the region like Kuwait, Abu Dhabi, Qatar, they've been doing big private placements.

But that obviously has an impact on the public issuance volumes, which are a little bit down year on year after what was a pretty spectacularly busy January and February.

Okay, then.

So how has the, I guess, the credit landscape changed in the Middle East as far as capital markets are concerned? Because some credits have had a sort of a better war than others, if that's not a terrible way to put it.

Yeah, if you compare now to the end of February, it's not actually looking that much different.

Gulf spreads, they blew out in March, understandably.

Immediately after the war, there was a big sort of knee-jerk sell-off, pretty much across the board to varying degrees.

But it's more or less rallied.

There are some spreads that are tighter than they were before the war.

I think that the obvious and big exception to that is the real estate companies, particularly the privately owned ones.

Some of them have government ownership, but a lot of them are private.

And they suffered really quite nasty sell-offs in March.

Their yields went hundreds of basis points higher rather than sort of tens like for some of the more higher rated issues.

And that's partly because, you know, a lot of them are below investment grade.

They're the kind of rare sub-investment grade issues from that part of the world.

The obvious reason for that is people have got worried about expats leaving the gulf because of the attacks from iran worried about people not wanting to move there in future worried about tourism that sort of thing but on the whole the you know the picture isn't actually that much different now they've been extraordinarily resilient even their

spreads have tightened back in a bit though haven't they