PRIMARY EUROSTERLING MARKET BOOMS DESPITE RATE CUT

  Two new eurosterling bonds were launched
  today, making a total of 10 new deals in the sector so far this
  month, as borrowers rush to cash in on a bull sterling market
  fueled by the strength of the pound and pre-budget euphoria.
      The Bank of England finally gave way to a 1/2 point cut in
  banks' base lending rates earlier today, but dealers said this
  had been largely discounted and was not likely to detract from
  the current popularity of sterling-denominated investments.
      "Sterling, in any shape or form, is flavor of the month and
  we're set to see many more eurosterling deals," one dealer said.
      Today's new eurosterling bonds were a 10-year, 100 mln stg
  deal for Sweden at 9-1/2 pct and priced at 101-1/4 pct, lead by
  Baring Brothers and Co Ltd and a 14 year 60 mln stg convertible
  deal for Storehouse Plc launched by SBCI International Ltd. "We
  thought we saw a proverbial flood of new deals with the 14 we
  had last month but it seems March will beat February hands down
  with 10 already," one eurosterling specialist said.
      "Optically, psychologically, these single figures are much
  more attractive for the borrower. Eurosterling looks like a
  cheap and attractive way to raise your money," he added.
      This accounts for the wide variety of borrowers who have
  tapped the sector recently, ranging from sovereigns such as the
  Kingdom of Sweden today, continental banks including
  Commerzbank and Deutsche Bank and British corporations.
      Another U.K. Merchant bank analyst noted that the current
  vogue for eurosterling enabled several corporate borrowers last
  month to offer paper priced below comparative gilt yields.
      A Storehouse official confirmed that the issue was aimed at
  Swiss and German investors who were showing good interest.
      This is the first entry into the long term international
  capital markets by Storehouse, British designer Terence
  Conran's retail conglomerate which incorporates U.K. Chain
  stores Mothercare, British Home Stores and Habitat.
      "We have been considering the move for quite some time now
  and the current strength of the eurosterling sector provided
  the perfect opportunity and spur for us to finally tap the
  market," Lance Moir, corporate treasurer at Storehouse Plc told
  Reuters.
  
  

