In June, domestic issuers made less intensive use of the Swiss franc bond market compared to May. The anticipated «final sprint» mentioned a month ago by Tim Schmuki of the Capital Markets Team at Zürcher Kantonalbank (ZKB) failed to materialize. According to ZKB, this was due to signs of market saturation and the escalation spiral in the Middle East. Nonetheless, the primary market still offered some highlights.

Key Figures and First Half-Year Overview

According to ZKB statistics, Swiss issuers (excluding the federal government) raised CHF 4,2 billion in June, representing a 39 percent decline compared to June 2024. However, foreign issuers increased activity sharply, raising CHF 1,9 billion, up 41 percent year-over-year.

The primary market in the first half of 2025 overall saw 11 percent more volume than the same period last year. In July, a summer lull is expected, particularly in the second half of the month due to holiday season.

A broad range of issuance benefits institutional investors, who often acquire larger blocks during the primary phase, since secondary market trading can be thin. The high activity also benefits banks involved in issuance—including ZKB—as their earnings depend heavily on volume placed. Lastly, a functioning primary market is crucial for corporates, financial institutions, public bodies (such as cantons and cities), and the broader economy, especially when other sources of funding (like traditional bank loans) become less attractive.

June Highlights

• City of Zurich launched a 100-year bond, the longest bond ever issued on the Swiss market.

• Zurich Airport returned to the primary market for the first time in nearly five years.

• St. Galler Kantonalbank issued the longest subordinated Tier 2 bond to date, with maturity in 2037 and a call date in 2032.
• Cembra Money Bank issued an auto lease-backed bond rated AAA, significantly above its bank rating of Single-A.
• Raiffeisen launched its first Green Bond, with proceeds earmarked for climate-friendly Swiss real estate financing. Services Industriels de Genève also issued a Green Bond.
• As usual, the two mortgage bond institutions were dominant in terms of volume, contributing nearly half of the total domestic issuance.

Other issuers included SGS (dual tranche), Alpiq, the Municipality of Köniz, cantonal banks from Valais and Lucerne, and Baloise, which is set to merge with Helvetia.

International Segment with Notable Debuts

The international primary market also brought headlines:

• Two first-time issuers appeared: the International Development Association (part of the World Bank Group, issuing a sustainable bond), and Uruguay (Republica Oriental del Uruguay), representing the sovereign segment.

• Among financials, there was a clear trend toward subordinated debt: Canadian Imperial Bank of Commerce (bail-in), Fédération des Caisses Desjardins du Québec (Tier 2), DZ Bank (Tier 2).

• Banco de Chile issued a Social Bond, a rarer type of Sustainable Bond compared to Green Bonds.

Other international issuers included Traton Financial (Volkswagen Group), Crédit Agricole Home Loan (Covered Bond), and the Republic of Austria, representing a second sovereign issuer.

Secondary Market Trading Also Rises – More Positive News for SIX

At the beginning of the month, SIX Group, the operator of Switzerland’s financial market infrastructure, released its secondary market figures for June.
CHF 10,5 billion in bonds were traded on the SIX Swiss Exchange, a 15 percent drop from May but a 10,6 percent increase compared to June 2024.

The strong primary market (newly listed bonds are typically traded more actively than older ones) seems to have boosted secondary market activity. In the first half of the year, bond trading volumes reached CHF 67 billion, up 11 percent year-over-year. However, some experts, such as Richard Mooser in an interview with finews.com, questioned the reliability of the SIX statistics due to the erosion of reporting requirements.

Finally, on Tuesday, SIX Group received another positive update:
Rating agency Standard & Poor’s affirmed its A rating (A+ for operating subsidiaries) and revised the outlook from negative to stable.