Bank and Capital Markets New Issue Review - week 48€¦ · Bank and Capital Markets New Issue Review . 01 ... the monetary policy committee ... telecommunications company Sable agreed

Bank and Capital Markets New Issue Review

01 Nov – 05 Nov 2014, week 48

Capital & Debt Advisory

Market Leading Independent Debt Advisory Bank Market | Public Bonds | Private Placements | Ratings | Hedging | Retail Bonds

Contents Section 1 Market backdrop 2

Section 2 Bank loan market 3

Section 3 USD public bond market 6

Section 4 GBP public bond market 9

Section 5 EUR public bond market 11

Section 6 US Private Placement market 12

Contacts

United Kingdom

Luke Reeve

Tel: +44 20 7951 6548 Email: [email protected]

Chris Lowe


Gary Davison


Europe

Olivier Catonnet Tel: +33 1 5561 0535 Email: [email protected]

Jonathan H.M. Harfield Tel: +420 731 627 155 Email: [email protected]

Britta Becker Tel: +49 40 36132 20781 Email: [email protected]

Asia

Gaurav Ahuja

Tel: +65 6309 8276 Email: [email protected]

US & Canada

K.C. Brechnitz Tel: +1 704 335 4211 Email: [email protected]

Tony Ianni


Australia

Sebastian Paphitis Tel: +61 2 9248 4773 Email: [email protected]

Jason Lowe


Section 7 Credit ratings 14

Section 8 Glossary 15

@EY_UKI

EY Capital and Debt Advisory - New Issue Review 2

Market backdrop

The US accelerates and surprises whilst oil continues to tumble

► On Thursday, the UK saw the Bank of England leave base rates unchanged for the 69th month in a row at 0.5%. Alongside this, the monetary policy committee also retained the size of the Bank’s quantitative easing at £375 bn. Finally, this week saw the Chancellor deliver his Autumn Statement to the market, noting increasing growth forecasts to 3% from the Office for Budget Responsibility (OBR) but a continuing lag in tackling the budget deficit.

► The ECB retained interest rates at the record low of 0.05% and lowered its 2015 forecast for consumer-price growth to 0.7% from 1.1% and in 2016 from 1.4% to 1.3%. In a continuing response to the increasing deflation threats and stagnating growth, the ECB noted that the Bank would review and consider quantitative easing in the early part of 2015, dependent on the impacts of current stimulus. Key challenges remain in implementing such a programme, as well as resistance from Germany who have commentated that such a programme would be outside of the ECB’s remit.

► Positive economic data from the United States continues, this time with the non-farm payrolls coming in at 312k during the month, significantly beating market expectations. The creation of over 300k jobs is the highest since January 2012 and was further supported by wage growth inflation of 0.4% in the month. The news was generally well received, with both the Dow Jones industrial average and S&P 500 advancing to record highs.

► Finally, uncertainty in the oil market continues as prices fall further. A growing supply glut has meant that prices have dropped to below US$70 pp/b for the first time in 5 years. The oil cartel Opec has opted to maintain its 30m-a-day production levels, despite the highest US shale gas output in three decades and lower than expected oil demand in Europe and China. Many industry analysts predict that lower prices will persist well into 2015, with forecasts from the International Energy Agency suggesting that Opec would have to cut production by 1m – 1.5m barrels a day in order to correct the current oversupply.

Section 1: Market backdrop

Tenor 3yr 5yr 7yr 10yr 30yr

UK swap rate 1.26 1.62 1.86 2.10 2.52

Gilt rate 0.88 1.36 1.64 2.02 2.74

Tenor 3yr 5yr 7yr 10yr 30yr

US swap rate 1.28 1.82 2.13 2.42 2.93

UST rate 1.07 1.69 2.06 2.31 2.97

Source: Bloomberg

Source: Bloomberg Source: Bloomberg

Source: Bloomberg

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2014 2016 2018 2020 2022 2024

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3 month UK LIBOR forward rates

Current forward 3m UK LIBOR (-1 wk) fwd 3m UK LIBOR

2yr

3yr 4yr

5yr 7yr 10yr

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Weekly change in UK SWAP

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10-year Benchmark yields

10yr UST 10yr Gilt 10yr Bund

Bank loan market

EUR / GBP completed transactions greater than US$250m


► Compuware Corp has launched a c.$2 billion credit facility to back its buyout by Thoma Bravo which was announced in early September. The debt package includes a $300m five-year term loan B-1, a $950m seven-year term loan B-2, a $105m asset sale bridge, a $550m eight-year second-lien term loan and a $100m five-year revolver. Total leverage is expected to be 5.5x on opening with 4x for first-lien leverage. That said, Moody's calculated pro forma leverage at 7.5x saying that the company should be able to reduce leverage to 6x by March 2016 due to cost-cutting measures.

► Last month, telecommunications company Sable agreed to acquire Columbus International Inc, a leading privately-owned fibre-based telecommunications provider operating in the Caribbean, Central America and the Andean region, for $1.85bn. The transaction will be funded by a $760m dual-tranche credit facility including a $460m senior secured loan and a $300m senior unsecured loan, both maturing in two years.

► The European Bank for Reconstruction and Development (EBRD) has arranged a long-term financing for the $1 billion combined-cycle gas turbine power plant that will be built in Turkey near the city of Kirikkale. The plant will be built by a Turkish subsidiary of independent Saudi Arabian firm ACWA Power. The EBRD has arranged a $250m loan, split between a $200m A loan from the EBRD's own account and a $50m B loan syndicated to Banque Saudi Fransi. Banque Saudi Fransi is also providing a $100m murabaha financing. In addition, The International Finance Corporation (IFC) arranged a $170m syndicated loan, of which $45 million is syndicated to the Korea Development Bank.

Section 2: EUR/GBP bank loan market

Source: Loan Connector Source: Loan Connector

Issue date

Issuer Tranche rating

Form Ccy Amount Maturity Margin (+bps)

Sector Ctry Leads

01-Dec CHRIST Juweliere NR, NR RCF EUR 25 - L+375 Consumer Products DE Various

01-Dec CHRIST Juweliere NR, NR RCF EUR 25 - L+375 Consumer Products DE Various

01-Dec CHRIST Juweliere NR, NR TL EUR 170 - L+450 Consumer Products DE Various

01-Dec Spectrum Brands NR, NR RCF EUR 150 - E+300 Automotive US CS, DB

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European pricing grid - multiyear drawn

AA A BBB

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250

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200

250

300

350

4Q

10

1Q

11

2Q

11

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11

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11

1Q

12

2Q

12

3Q

12

4Q

12

1Q

13

2Q

13

3Q

13

4Q

13

1Q

14

2Q

14

3Q

14

Nu

mb

er

of

de

als

Vo

lum

e (

US

$b

n)

Western Europe Loan Volumes

Lev - Vol. ($Bils.) IG - Vol. ($Bils.)

Lev - No. of Deals IG - No. of Deals

Bank loan market


Section 2: Bank loan market

USD completed transactions greater than US$250m

Issue date



Sector Ctry Leads

03-Dec Autonation NR, NR RCF USD 1,700 2019 L+150 Automotive US Various

03-Dec Compuware NR, NR RCF USD 100 2019 - Technology US CS, DB, JEFF

03-Dec Compuware NR, NR TL USD 300 2019 L+450 Technology US CS, DB, JEFF



03-Dec Compuware NR, NR OTH USD 105 - L+450 Technology US CS, DB, JEFF

03-Dec Sonneborn B1, B TL USD 280 2020 L+450 Oil & Gas US Macquarie

02-Dec China Communications NR, NR OTH USD 1,100 2015 - Construction CN Various

02-Dec Global Cash Access B1, B+ RCF USD 50 2019 - Business Services US BAML, DB

02-Dec Global Cash Access B1, B+ TL USD 500 2020 L+525 Business Services US BAML, DB

02-Dec Sable NR, NR RCF USD 500 - - Telecommunications UK JPM

02-Dec Sable NR, NR TL USD 300 2016 L+550 Telecommunications UK JPM

02-Dec Sable NR, NR TL USD 460 2016 L+450 Telecommunications UK JPM

02-Dec Tesoro NR, NR RCF USD 900 2019 L+275 Oil & Gas US BAML, RBS

02-Dec Varsity Brands B1, B+ TL USD 755 2021 - Media & Entertainment US GS

01-Dec ACWA Power NR, NR TL USD 50 - - Power & Utilities TR Banque Saudi Fransi, EBRD

01-Dec ACWA Power NR, NR TL USD 200 - - Power & Utilities TR -

01-Dec ACWA Power NR, NR OTH USD 60 - - Power & Utilities TR -

01-Dec ACWA Power NR, NR OTH USD 90 - - Power & Utilities TR -

01-Dec ACWA Power NR, NR OTH USD 170 - - Power & Utilities TR IFC

01-Dec Amerada Hess NR, NR RCF USD 4,000 2020 L+108 Oil & Gas US Various

01-Dec Archer Daniels NR, A RCF USD 1,500 2019 - Consumer Products US Various

01-Dec Cydsa NR, NR TL USD 120 2019 - Chemicals MX Citi, RAB

01-Dec Cydsa NR, NR OTH USD 30 2017 - Chemicals MX Citi, RAB

01-Dec Cydsa NR, NR OTH USD 150 2019 - Chemicals MX Citi, RAB

01-Dec Egyptian General Petroleum

NR, NR TL USD 1,500 2017 - Oil & Gas EG HSBC, NBAD, NBE

01-Dec Fibria Celulose NR, NR TL USD 100 2019 L+130 Consumer Products BR BNP, NAT

Bank loan market


Section 2: Bank loan market

USD completed transactions greater than US$250m (cont.)

Issue date



Sector Ctry Leads



01-Dec Hitachi Metals NR, NR TL JPY 35,500 2020 - Mining & Metals JP BOTM

01-Dec Hitachi Metals NR, NR TL USD 650 2021 - Mining & Metals JP BOTM

01-Dec Hitachi Metals NR, NR TL JPY 10,000 2021 - Mining & Metals JP BOTM

01-Dec Sunrun NR, NR OTH USD 200 - L+300 Power & Utilities US Investec

01-Dec Terra-Gen NR, NR TL USD 300 2021 L+425 Power & Utilities US Citi, GS

01-Dec TierPoint B2, NR RCF USD 40 - - Technology US CS, RBC

01-Dec TierPoint B2, NR TL USD 330 2021 L+425 Technology US CS, RBC

01-Dec TierPoint Caa2, NR TL USD 90 2022 L+775 Technology US CS, RBC

01-Dec Waterfront Properties NR, NR TL USD 445 2021 - Real Estate IN STA

USD public bond market


► Following a relatively quiet week due to Thanksgiving on the other side of the Atlantic, the USD bond market saw a flurry of jumbo issuance in the investment grade space this week as companies rushed to take advantage of low interest rates. Notable jumbo issuance this week came from Beckett Dickinson (Baa2, BBB+, NR), Amazon (Baa1, AA-, NR) and Medtronic (A3, AA-, NR).

► This week, Minneapolis medical-device maker, Medtronic (A3, AA-, NR), tapped the US$ bond market for US$17 billion across 7-tranches. Proceeds from the bond issuance are to be used by Medtronic to finance its US$43 billion purchase of Ireland’s Covidien.

► Medtronic’s issuance is this year’s biggest corporate bond deal outdoing Apple’s US$12 billion issuance in April earlier this year. Medtronic’s issue is tied for the second largest on record with Apple’s US$17 billion issuance in April 2013 with the largest corporate bond sale on record being Verizon Communications’ US$49 billion issuance in September 2013.

► Medtronic’s bond sale attracted an order book of US$45 billion further confirming how highly rated US corporate debt has been one of the best performing categories of fixed income this year.

Domestic

Section 3: USD public bond market

Source: Reuters Source: Reuters

Issue date

Issuer Tranche rating (M,S&P,F)

Form Amount (US$m)

Coupon Maturity Spread (T+bps)

Sector Ctry Leads

4-Dec ADT Ba2, BB-, BBB- SN 300 5.250% 2020 +362 Consumer Products US Various

4-Dec Becton Dickinson Baa2, BBB+, NR SN 750 Float 2016 - Life Sciences US Various

4-Dec Becton Dickinson Baa2, BBB+, NR SN 1,250 1.800% 2017 +85 Life Sciences US Various




4-Dec Church & Dwight Baa1, BBB+, NR SN 300 2.450% 2019 +88 Consumer Products US Various

4-Dec Clorox Baa1, BBB+, BBB+ SN 500 3.500% 2024 +125 Consumer Products US Various

4-Dec Cott Beverages B3, B-, NR SN 625 6.750% 2020 - Consumer Products US Various

3-Dec Ameren A2, A, A- SSN 300 3.250% 2025 +97 Power & Utilities US Various

0

50

100

150

200

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bp

s)

USD secondary public bond spread 10-year

Avg. AA USD 10yr spreads Avg. A USD 10yr spreads

Avg. BBB USD 10yr spreads

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Monthy US$ bond volumes

Domestic volume (US$) Cross-border volume (US$)

Cross-border number issued Domestic number issued




Domestic (cont.)

Issue date


Form Amount (US$m)


Sector Ctry Leads

3-Dec Dominion Gas A2, NR, A- SN 450 2.500% 2019 +90 Oil & Gas US Various



3-Dec Entergy A3, NR, NR SSN 250 4.950% 2044 +200 Power & Utilities US Various

3-Dec UnitedHealth A3, A+, A- SN 750 1.400% 2017 +48 Life Sciences US Various



3-Dec Viacom Baa2, BBB, BBB+ SN 400 2.750% 2019 +115 Media & Entertainment US Various

3-Dec Viacom Baa2, BBB, BBB+ SN 600 4.850% 2034 +190 Media & Entertainment US Various

2-Dec Amazon Baa1, AA-, NR SN 1,000 2.600% 2019 +105 Consumer Products US Various




2-Dec Amazon Baa1, NR, NR SN 1,500 4.950% 2044 +205 Consumer Products US Various

2-Dec DirecTV Baa2, BBB, NR SN 1,200 3.950% 2025 +175 Media & Entertainment US Various

2-Dec Plains All American Baa2, BBB+, NR SN 500 2.600% 2019 +105 Oil & Gas US Various

2-Dec Plains All American Baa2, BBB+, NR SN 650 4.900% 2045 +190 Oil & Gas US Various

2-Dec Tenneco Ba3, BB, BB SN 225 5.375% 2024 +310 Automotive US Wells, Citi, MS

1-Dec Berkshire Hathaway A3, BBB+, BBB+ SN 350 2.400% 2020 +88 Power & Utilities US Various



1-Dec Cox Baa2, BBB, BBB+ SN 700 3.850% 2025 +165 Media & Entertainment US Various

1-Dec Cox Baa2, BBB, BBB+ SN 650 4.800% 2035 +185 Media & Entertainment US Various

1-Dec Medtronic A3, AA-, NR SN 1,000 1.500% 2018 +70 Life Sciences US Various

1-Dec Medtronic A3, AA-, NR SN 500 Floats 2020 - Life Sciences US Various








Domestic (cont.)

Issue date


Form Amount (US$m)


Sector Ctry Leads


1-Dec Spectrum Brands B3, B, BB- SN 250 6.125% 2024 +391 Consumer Products US CS, DB

Cross border

Issue date


Form Amount (US$m)


Sector Ctry Leads

5-Dec Constellium B1, NR, NR SN 400 8.000% 2023 +582 Mining & Metals FR DB, GS, SG

4-Dec Chinalco A1, NR, NR SN 500 3.625% 2019 +213 Mining & Metals CN Various

4-Dec Dana B2, BB+, NR SN 425 5.500% 2024 +324 Automotive UK Various

2-Dec Sunac China B1, B+, BB- SN 400 8.750% 2019 - Real Estate CN Various

2-Dec Unitymedia Hessen Baa3, BB-, NR SSN 550 5.000% 2025 +271 Media & Entertainment DE Various

1-Dec Logan Property B1, NR, BB- SN 250 9.750% 2017 - Real Estate CN Various

1-Dec Yuzhou Properties B1, NR, NR SN 250 9.000% 2019 - Real Estate HK Various

GBP public bond market


Section 4: GBP public bond market


Domestic

Cross-border

► In a relatively quiet week with limited new issue supply, the Sterling bond market saw UPP (Baa1, A-, NR) issue £150m of 35-year notes at 1.037% (G+175bps).

Issue date


Form Amount (GBPm)

Coupon Maturity Spread (G+bps)

Sector Ctry Leads

No significant issuance in the week

Issue date


Form Amount (GBPm)

Coupon Maturity Spread (G+bps)

Sector Ctry Leads

3-Dec UPP Baa1, A-, NR SSN 150 1.037% 2049 +175 Real Estate UK BAR, RBS

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GBP secondary public bond spread 10-year

Avg. AA GBP 10yr spreads Avg. A GBP 10yr spreads

Avg. BBB GBP 10yr spreads

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Monthy GBP bond volumes

Volume (GBP) Number issued

ORB retail bond market


In the market

Recent Issues

Date Issuer Ratings (M,S&P,F) Form Amount (GBPm)

Coupon Maturity Sector Country

16-Oct Eros International NR, NR, NR SN 50 6.50% 2021 Media & Entertainment

UK

1-Oct A2D Funding NR, NR, NR SSN 150 4.50% 2026 Real Estate UK

20-Aug Burford Capital NR, NR, NR SN 90 6.50% 2022 Finance UK

15-Jul Golden Lane Charity NR, NR, NR SN 11 4.47% 2021 Real Estate UK

9-Jun Ladbrokes NR, BB, BB SN 100 5.13% 2022 Leisure UK

30-Jan Paragon NR, NR, NR SN 125 6.13% 2022 Finance UK

6-Dec Premier Oil NR, NR, NR SN 150 5.00% 2020 Oil & Gas UK

21-Oct A2Dominion NR, NR, AA- SN 150 4.75% 2022 Real Estate UK

25-Jul Bruntwood NR, NR, NR SSN 50 6.00% 2020 Real Estate UK

25-Jun Helical Bar NR, NR, NR SN 80 6.00% 2020 Real Estate UK

8-May International Personal Finance

NR, NR, BB+ SN 70 6.13% 2020 Finance UK

21-Mar Provident NR, NR, BBB SN 65 6.00% 2021 Finance UK

05-Mar Paragon NR, NR, NR SN 60 6.00% 2020 Finance UK

15-Feb EnQuest NR, NR, NR SN 145 5.50% 2022 Oil & Gas UK

19-Dec Alpha Plus NR, NR, NR SSN 49 5.75% 2019 Education UK

12-Dec UNITE NR, NR, NR SN 90 6.13% 2020 Real Estate UK

Date Issuer Ratings (M,S&P,F) Form Amount (GBPm)

Coupon Maturity Sector Country

No significant issuances in the week

Section 4: ORB retail bond market

EUR public bond market


► This week, the Eurobond market saw a number of domestic issuers tap the market with the Swedish premium automobile giant, Volvo (Ba1, NR, NR), raising EUR1.5 billion in two tranches to further strengthen the Group’s balance sheet and prolong the maturity structure of the debt portfolio.

► The EUR0.9 billion tranche, with a first call after 5.5 years and a maturity of 60.5 years, was issued at 4.200%.

► The EUR0.6 billion tranche, with a first call after 8.25 years and a maturity of 63.25 years, was issued at 4.850%.

Section 5: EUR public bond market


Domestic

Issue date


Form Amount (EURm)

Coupon Maturity Spread (+bps)

Sector Ctry Leads

5-Dec Corvallis NR, NR, NR SN 8,000 6.250% 2019 - Technology DK Various

5-Dec Constellium B1, NR, NR SN 240 7.000% 2023 +646 Mining & Metals FR DB, GS, SG

4-Dec Danfoss NR, BBB, NR SN 500 1.375% 2022 MS+78 Technology DK Various

3-Dec Imerys Baa2, NR, NR SN 100 2.500% 2020 MS+80 Chemicals FR Various

3-Dec Imerys Baa2, NR, NR SN 500 2.000% 2024 MS+115 Chemicals FR Various

3-Dec Volvo Ba1, NR, NR SUB 900 4.200% 2075 MS+380 Automotive SE Various

3-Dec Volvo Ba1, NR, NR SUB 600 4.850% 2078 MS+410 Automotive SE Various

2-Dec Casino Guichard-Perrachon

NR, NR, BBB- SN 650 2.330% 2025 MS+135 Consumer products FR Various

2-Dec Unitymedia Hessen Baa3, BB-, BB- SSN 1,000 4.000% 2025 MS+326 Media & Entertainment

DE Various

0

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EUR secondary public bond spread 10-year

Avg. AA EUR 10yr spreads Avg. A EUR 10yr spreads

Avg. BBB EUR 10yr spreads

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Monthy EUR bond volumes

Volume (EUR) Number issued

Cross border

Issue date


Form Amount (EURm)

Coupon Maturity Spread (+bps)

Sector Ctry Leads

1-Dec Albemarle Baa3, BBB-, NR SN 700 1.875% 2021 MS+140 Chemicals US BASML, JPM, Wells

0

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NAIC-2 US Private Placement spreads (bps)

10yr High 10yr Low

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NAIC-1 US Private Placement spreads (bps)

10yr High 10yr Low

Private Placement market


► In the domestic market, AptarGroup Inc (NAIC-1), a leading global supplier of a broad range of innovative dispensing systems for the Personal Care, Fragrance/Cosmetic, Pharmaceutical, Household and Food/Beverage Markets, tapped the market. The deal was launched as $250m of senior notes, split into 9-year and 11-year pieces with funding in December and February: 9-year bullets, at +125bp; and 11-year bullets, at +125bp.

► Last week, the Empire District Electric Co (NAIC-2), an electric utility based in Missouri, tapped the market in a deal with TIAA, John Hancock, and CUNA. The transaction was for $60mm of 4.27% FMB due in 30-years.

► Caribbean Utilities Co Ltd (NAIC-1), provides electricity to Grand Cayman, Cayman Islands, under a non-exclusive Electricity Generation License expiring in 2029 and an exclusive Electricity Transmission and Distribution License expiring in 2028. Last week, the company raised $50m of senior notes in three pieces with a portion of the funding being used to finance the development of a 39.7 MW diesel power plant. The three tranches included $30m of 15-year bullets, with a 3.65% coupon; $5m of 20-year bullets, with a 3.85% coupon; and $15m of 32-year bullets, with a 4.53% coupon.

► Bracco Imaging, an Italian multinational healthcare company, involved in diagnostic imaging, contrast-agent injection systems, and prescription and over-the-counter pharmaceuticals, tapped the USPP market ahead of its listing on the Luxembourg Stock Exchange. The transaction was done as €100m of 7-year unsecured notes, with a 3.17% coupon.

Section 6: US Private Placement market

Source: Private Placement Monitor Source: Bloomberg

Source: Private Placement Monitor Source: Private Placement Monitor

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US Private Placement volumes

2011 2012 2013 2014

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Yie

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US Treasury benchmark yields

5yr UST 7yr UST 10yr UST 30yr UST

Date Issuer Ratings Form Amount (US$m) Coupon Maturity Spread (T+bps)

Sector Ctry

Dec-14 Indianapolis Courthouse - SSN - - 20yr - Real Estate US

Dec-14 2014 Replacement Power Statutory Trust

NAIC-1 SSN 355 - 15f/8avg +150 Power & Utilities

US

Dec-14 Empire State Realty Trust

NAIC-2 - 200 - 10yr, 12yr,

15yr +100 Real Estate US

Nov-14 Teekay Offshore Partners

NAIC-2 SSN 45 - 10yr +200 - 210 Oil & Gas US


Sector Ctry

Dec-14 Oldendorff Carriers NAIC-2 SSN 50 - 10yr, 30yr +200 Transport DE


Sector Ctry

Dec-14 AptarGroup NAIC-1 SN 475 - 9yr

11yr +125 +125

Consumer Products

US

Dec-14 Empire District Electric NAIC-2 FMB 60 4.27% 30yr - Power & Utilities

US

Dec-14 Wind Energy Transmission

NAIC-1 (A3)

SSN 155 490

4.31% 3.67%

10f/9avg 20f/16avg

+205/10yr +120/Icur

Power & Utilities

US

Nov-14 AES NAIC-2 (BBB)

SN 298 4.17% 9f/3.6avg +300 Power & Utilities

US

Nov-14 STAG Industrial NAIC-2 (BBB-)

SN 80

100 20

4.42% 4.32% 4.42%

8yr 10yr 12yr

+210/10yr +200

+210/10yr Real Estate US

Private Placement market

Domestic: In the market


Domestic: Issued

Section 6: US Private Placement market

Cross Border: In the market

Cross Border: Issued


Sector Ctry

Dec-14 Fortis TCI NAIC-1 SN 90 4.75% 15f/10.25av

g +100

Power & Utilities

CA

Dec-14 Caribbean Utilities NAIC-1 SN 30 5

15

3.65% 3.85% 4.53%

15yr 20yr 32yr

- Power & Utilities

KY

Dec-14 Bracco Imaging - SN EUR 100 3.17% 7yr - Life Sciences IT

Nov-14 Energy Partnership NAIC-2 (Baa3/BBB-)

SN 105

AUD 47.5 3.39% 7yr

+140 +147.5/UST

Power & Utilities

AUS

Nov-14 Befimmo SCA NAIC-2 SN EUR 12 - 10yr - Real Estate BE

Nov-14 BMW NAIC-1 SN 85

215 50

2.91% 3.30% FRN

7yr 10yr 10yr

+90 +100 +100

Automotive DE

Credit ratings

New and Notable from Ratings Agencies


The above list highlights ratings developments that we believe are interesting or noteworthy. This list is not exhaustive.

Section 7: Credit ratings

Issuer Actions Agency

SMBC Aviation Capital Ltd. Ireland-based aircraft operating lessor assigned BBB+ rating/ outlook stable S&P

Action Holding B.V. Netherlands-based nonfood discounter assigned B+ rating on dividend recapitalization and refinancing plans/ outlook stable

S&P

New ratings Keepmoat U.K.-based provider of regeneration services and homebuilding assigned B2 rating/ outlook stable Moody's

Issuer Actions / Comment Agency

Rating actions

EDF Energy group A+ rating is affirmed but with negative outlook maintained Fitch

Ireland Upgraded to A from A- on improved growth and fiscal performance/ outlook stable S&P

E.ON SE German integrated utility's A- rating placed on CreditWatch negative on announced spin-off off a majority stake in its power and gas upstream and midstream business

S&P

Channel Link Enterprises Finance UK-based project finance company rating raised to BBB+ on stronger expected operations/ outlook stable

S&P

Italy Rating lowered to BBB- from BBB reflecting the recurrent weaknesses real and nominal GDP performance/ outlook stable

S&P

Tereos French sugar producer rating outlook revised to negative as fall in sugar prices hits forecast credit metrics. BB+ rating affirmed

S&P

Comboios de Portugal Portuguese rail operator upgraded to BB on integration with Portuguese government/ outlook stable S&P

Constellium N.V. French aluminium producer downgraded to B on debt-funded purchase of U.S.-based Wise Metals/ outlook stable

S&P

Cooperative Bank Plc Bank B rating is affirmed but with a Negative Outlook maintained Fitch

Theme Comment Agency

Finance and market trends

Global growth Global Economic Outlook published. US main driver of growth, with 2015 forecast GDP growth at 3.1% Fitch

Germany German bond issuance to continue slow growth trend in 2015 Moody's

EU Banks Mostly negative European banking system outlooks in 2015 owing to new bail-in regimes, despite improving financial stability

Moody's

EU banks EU bank ratings maintain a negative bias due to potential pressure on state support under EU Bank Recovery and Resolution Plans

Fitch

US regional banks Credit pressure on banks' energy loan books will build should low prices persist into 2015 Fitch

Leveraged Finance U.S. Leveraged Finance investors see favorable market conditions In 2015 / Speculative-Grade rating actions increased in November amid commodity price volatility

S&P

EMEA Corporates Stable outlook for EMEA non-financial corporates despite slow growth on the back of economic reforms, euro weakness and corporate deleveraging/ Debt capacity and rating headroom expected to increase for EMEA corporates in 2015

Moody's/ Fitch


Industry comment

Reinsurance Negative outlook maintained for global reinsurance sector for 2015 as buyers wield strong bargaining power and continue to explore cheaper alternatives to traditional reinsurance

Moody's

US local government Outlook is Stable, with moderate revenue growth, controlled spending, and mixed long-term liabilities Fitch

Infrastructure Revenue sources for debt repayment, not funding availability, are major factor causing under-investment

Fitch

Rail Global Rail companies enjoy a largely stable outlook, but some face sovereign risk S&P

Real Estate Prospects for EMEA's Real Estate sector remain stable thanks to low interest rates and steady earnings S&P

Luxury Goods Europe's Luxury Goods industry will likely cope well with ongoing shifts in global demand S&P


Methodologies Structured Finance S&P publishes methodology for assessing mortgage insurance in structured and public sector finance and covered bonds

S&P

Asset-backed securitization ABS Not rated NR

Commercial mortgage-backed securitization CMBS Other loan OTH

Credit tenant lease CTL Project bond (non-recourse) PB

Deep discount bond DDB Revolving credit facility RCF

Energy savings performance contract ESPC Senior note SN

First mortgage bonds FMB Senior secured note SSN

London interbank offered rate LIBOR Subordinated note SUB

Medium-term note MTN Term loan TL

ABN Amro ABN Jefferies & Co. JEFF

Bank of America Merrill Lynch BAML JP Morgan JPM

BBVA Securities BBVA KBC Capital Markets KBC

Bank of Tokyo Mitsubishi UFJ BOTM Landesbank Baden-Wuerttemberg LBBW

Banco Santander SA SANT Lloyds Capital Services Ltd LCS

Bank of New York BNY Lloyds Banking Group LBG

Bank of Nova Scotia BNS Banca March MAR

Barclays Bank BAR Mitsubishi UFJ Financial MIS

BayernLB BLB Mizuho Financial Group Inc MIZ

BMO Capital Markets BMO Morgan Stanley MS

BNP Paribas Group BNP Natixis NAT

Capital One Bank COB Norddeutsche Landesbank GZ NLB

Calyon CAL Nomura NOM

CIBC World Markets CIBC PNC Capital Markets PNC

Citi Citi Rabobank RAB

Commonwealth Bank of Australia CBA RBC Capital Markets RBC

Commerzbank AG CZB Raiffeisen Bank International RBI

Crédit Agricole CA RBS RBS

Credit Suisse CS Société Générale SG

Deutsche Bank DB Scotia Capital Inc SCA

DnB NORD DnB Standard Bank Plc SB

European Investment Group EIG Standard Chartered Bank STA

Fortis Securities Inc FOR SRM Robinson Humphrey SRH

Goldman Sachs & Co GS Sumitomo SUM

HSBC HSBC UBS UBS

ING Groep NV ING UniCredit Group UNI

Intesa Sanpaolo SA ISP U.S. Bancorp USB

Incapital LLC INC Wells Fargo Wells

Banca IMI IMI WestLB WLB

Glossary Technical abbreviations

Financial institution abbreviations

EY | Assurance | Tax | Transactions | Advisory

Ernst & Young LLP

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Information in this publication is intended to provide only a general outline of the subjects covered. It should neither be regarded as comprehensive nor sufficient for making decisions, nor should it be used in place of professional advice. Ernst & Young LLP accepts no responsibility for any loss arising from any action taken or not taken by anyone using this material.

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Bank and Capital Markets New Issue Review - week 48€¦ · Bank and Capital Markets New Issue Review . 01 ... the monetary policy committee ... telecommunications company Sable agreed