Debt Capital Markets Update Q2 2020

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We are pleased to share LSEG’s Quarterly Debt Capital Markets (DCM) update for Q2 2020. The update provides a review of global DCM activity and key highlights from London Stock Exchange, including how our markets are reacting to the impact of the Coronavirus (COVID-19) pandemic and how we can support your business during these uncertain times.

It has been an eventful Q2, and indeed first half of the year in the Debt Capital Markets. We launched an enhanced www.LondonStockExchange.com with new functionalities for issuers and investors, hosted several virtual events including partnering with ICMA for the livestream of the Green & Social Bond Principles AGM; and were recognised for our efforts as Stock Exchange of the Year in the Environmental Finance Sustainable Investment Awards 2020.

Highlights:

  • Global macro dynamics continue to be impacted by COVID-19, with global issuance volumes growing compared to Q2 2019, led by a spike of activity April 2020, led by supranationals, governments and investment grade corporates. Central Banks have kept interest rates at record lows to stimulate the economy.
  • Key transactions: In Q2 2020, London Stock Exchange saw deals from corporate, FIG, sovereign and supranational issuers, with a total of $257bn raised by global issuers through 260 bonds. International Securities Market (ISM) continues to grow, now with 178 admitted bonds, raising £49.2bn from 59 issuers from across the world.
  • Supporting the ongoing response to the pandemic: During H1 2020, issuers raised £65bn through COVID-19 related response bonds on London Stock Exchange and Borsa Italiana, London Stock Exchange has extended its admission fee waiver for social and sustainability bonds with use of proceeds aligned towards mitigating the impact of COVID-19 until 3 October 2020. You can find more information on eligibility criteria and why social bonds are relevant in today’s circumstances here.
  • An enhanced LondonStockExchange.com: was launched in May, with a fresh look and feel and a significantly improved user experience. We have created a new personal investing section for the millions of investors that visit our pages, implemented enhanced data and search functionality with dynamically updated market data pages and heatmaps. Debt issuers now have control of their issuer and instrument pages through the Issuer Services Portal and can use the self-service functionality to upload their deal documentation, including programmes, frameworks and documents incorporated by reference, as well as SparkLive for livestreaming events through their pages. Please refer to our detailed guide
  • Sustainability-Linked bonds now on SBM: Following the launch of the Sustainability-Linked Bond Principles, administered by ICMA, we have updated our Sustainable Bond Market (SBM) eligibility criteria to allow sustainability-linked bonds to be admitted under the dedicated issuer-level segment. This allows for differentiation between use-of-proceeds and general-purpose bonds that are sustainability-linked, strengthening transparency for issuers and investors. You can find more information here.
  • The international hub for sovereign listings: In 2Q 2020 we have seen landmark issuances such as Belarus’s $1.25bn dual trancher, Hungary’s €1.5bn debut green Eurobond, Egypt’s $5bn triple trancher, the State of Israel’s $5bn Formosa bond among others.
  • UK capital raising: H1 2020 saw a 54% YoY increase in amount issued and a 34% increase in number of bonds listed from UK issuers, led by sectors such as utilities and real estate, which have seen an 83% and 43% increase in number of bonds issued, respectively, including debut sustainable and green bonds by Southern Water and Northern PowerGrid respectively.  
  • Upcoming events: London Stock Exchange’s DCM team is delighted to invite you to our upcoming virtual webinars and events, including “An Update on the International Securities Market” on August 18, and our flagship “Debt Capital Markets Forum” on September 21.

To find out more about London Stock Exchange's Debt Capital Markets you can contact the Fixed Income team at bonds@lseg.com or 0207 797 3921.

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