CaixaBank Surges as Bond Sales Ease Debt Concern: Madrid Mover

CaixaBank SA and Banco Popular Espanol SA jumped in Madrid trading after the companies sold bonds to investors, signaling that borrowing conditions were easing.

CaixaBank climbed as much as 14 percent, the most on Europe’s benchmark Stoxx 600 Banks Index, before closing up 12 percent at 3.15 euros, its highest level since March last year. Popular advanced 8.4 percent to 0.76 euros, the highest since October.

Barcelona-based CaixaBank sold 1 billion euros ($1.31 billion) of three-year senior debt at 285 basis points, or 2.85 percentage points, above midswap rates, it said in an e-mailed statement today. Popular sold 750 million euros of 30-month senior unsecured bonds yesterday to yield 4.125 percent, according to a person familiar with the matter who asked not to be identified as they’re not authorized to speak on the matter.

The renewed ability of Spanish banks, whose combined net borrowings from the European Central Bank run to 341 billion euros, to tap wholesale debt markets is a sign that funding stresses are easing, said Juan Pablo Lopez, an analyst at Espirito Santo Investment Bank in Madrid.

“In the absence of other reasons for the gains, it’s positive,” said Lopez. “It always helps when they show they can issue debt.”

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