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Corporate paper ECP and USCP Makrets; ABS ECP shrinks; Euribor BM Update


By Ioannis Gougoulias

The data below was retrieved using CMDportal's Data Sheet and Instrument Search tool.

 

European Commercial Paper and USCP markets record 3.3% and 10% increases YTD.

The total outstanding amount in European Commercial Paper and Certificates of Deposits recorded a small 3% increase in 2018 YTD. Starting in January 2018, the amount of market was close to EUR796bn. After three and a half months this amount grew by EUR26.3bn to EUR822bn. Taking into consideration, the French domestic market (NEU CP), we see that the outstanding also rose by an impressive 10% in just 3 months, starting from EUR255bn and finishing at EUR281bn. In the CMDportal universe, we also count the German domestic CPCD market. This segment grew as well from EUR9.5bn at the beginning of the year to EUR11.8bn in late March, figures which suggest a 23% increase. Combining Euro CP, NEU and German CP we get a figure close to EUR1.096bn for the end of March 2018. At the same time, the USCP recorded a strong 9% reaching this way, USD1.048bn.

 

Asset Backed European Commercial Paper market shrinks 6.3% YTD

Based on aggregated data up to 13th of April 2018, the size of the European Asset Backed Commercial Paper market has shrunk by 6.3%. The size of the market in the beginning of the year was close to EUR50bn but after 14 weeks (up to second week of April 2018) it dropped to EUR46.7bn. The largest amount of the market is denominated is the EUR currency, which now consists of the 64%, growing from 57.7% at the start of 2018. On the other hand, the size of the USD denominated Asset Backed Commercial Paper has dropped 39%, from EUR10bn to EUR6bn. In this market the NEU CP market has recorded an 11% drop in size, going from EUR5.5bn to EUR 4.9bn. Given the low interest rate environment in Europe and in the US we would expect this market to grow but this does not seem to be the case.
 

Corporate ECP increases by impressive 30.3%

Although the Asset Backed segment of the ECP market is shrinking, the Corporate is thriving. According to CMDportal data, this segment of the market grew in just three and a half months from EUR62bn to EUR80bn. The SSA sector, also, recorded a strong 5.21% increase. The rest of the sectors, Insurance and SFVs are down by 9% and 6%, respectively, while the FIG ECP market, which had an impressive year in 2017 with a 12% increase, is now down by 0.5%.

What are the recent developments on the benchmark reform?


 

• In Europe, the ECB launched a second consultation in mid-March on its new overnight unsecured interest rate, while EMMI launched last week the first consultation for the hybrid methodology proposed for Euribor.
• In the UK, the Bank of England will soon calculate and publish the reformed SONIA rate, from 23 April.
• In the US, the Fed has published its new Secured Overnight Financing Rate for the first time on Tuesday; futures on the new overnight rate will be launched on 7 May 2018.

To learn more about the recent trends click on the following link: Strategy Desknotes Global - Guide to Benchmark Reform.

 

Where is this data coming from? 

CMDportal is the global bond and money market utility connecting issuersdealers and investors. The service aggregates data from a wide range of sources, including issuers, dealers and fund investors recording both who issued, who traded and who bought the instruments. 


Can i produce a Debt Capital Markets statistical query like this?


Yes you can. CMDportal provides a wide range of tools to analyse bond and money markets. Data Sheet results can be downloaded as an XLS file. 

Mr. Gougoulias is an Analyst at CMDportal. He can be reached at analysts@cmdportal.com.
  



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