Demand for corporate bonds is falling – with a few exceptions

Frankfurt In view of delays and train cancellations, Deutsche Bahn is currently rarely generating enthusiasm. But at least among investors in the bond market, the train is in demand. There were purchase orders for more than EUR 4.5 billion for the state-owned company’s new EUR 500 million bond – the bond was oversubscribed nine times.

Ingo Nolden, who heads the capital market business with companies at HSBC Germany, knows that such high demand has become extremely rare: “Many new bonds have recently been only twice oversubscribed, some even less.”

Twice as much demand as supply – that doesn’t sound like a big problem for companies at first. But last year, according to Nolden, demand generally exceeded supply three to four times. Paula Weißhuber, Head of Corporate Bonds at Bank of America (BofA) in Europe, emphasizes: “Many companies find the current market environment challenging.”