10.31.2013
By Terry Flanagan

Euronext Brussels Lists First Bond Issue

NYSE Euronext Brussels has completed its first institutional bond offering as investors have become increasingly concerned about the decrease of liquidity in credit markets.

The exchange said in a statement today that it had completed a €250m institutional bond offering on Euronext Brussel. Belfius and BNP Paribas Fortis were joint lead managers for the bond offering from Infrax, the Belgium-based multi-utility group which is publicly owned by 126 municipalities and 4 provinces.

Alain Baetens, head of listings Belgium at NYSE Euronext, said in the statement: “Our goal at NYSE Euronext is to channel domestic savings back into productive investment and allow the stock exchange to steadily increase its contribution to financing the real economy. Bonds are a complementary source of finance for issuers seeking to optimise their funding base and reach out to a new range of investors.”

In July Eric Forest joined NYSE Euronext as chairman and chief executive of EnterNext, a marketplace dedicated to companies with a market cap of less than €1bn, and he launched EnterNext in Belgium that month.

Enternext introduced the IBO, a bond offering with  the same subscription process as an initial pubic offering in the equity market, in France in 2012. The exchange launched a bond product as European banks have reduced their balance sheets and cut lending since the financial crisis.

Less liquid credit markets have also become a big concern for US institutional fixed income investors. A report from Greenwich Associates last week said that 85% of the 1,027 US institutions in the consultancy’s fixed income study were concerned about reduced liquidity.

The report said: “The root cause of the most recent liquidity reductions is not a lack of supply of credit investments, but rather, market structure transitions impeding the market’s ability to put risk in the hands of those who want it most.”

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