French corporates are enjoying their status as Europe’s most popular bond market. Traditionally, that mantle went to Germany, whose markets are larger and more liquid. But amid sovereign debt fears across the continent, which are driving investors out of southern European bonds into French and German ones, France is coming out on top.

Covered bond sales by French banks have surged above Germany's usually dominant market for the first time in the six months to June 30, data provider Dealogic shows.