Weekly Credit Update

1 March 2016

Weekly Credit Update

Important disclosures and certifications are contained from page 36 of this report

Analysts Louis Landeman +46 8 568 80524 [email protected] Katrine Jensen +45 45 12 80 56 [email protected]

Investment Research www.danskebank.com/CI

This document is intended for institutional investors and is not subject to all the independence and disclosure standards applicable to debt research reports prepared for retail investors.

2 2

- General credit market news and current themes

- Credit indicators

- Scandi investment grade

Contents

- Coverage universe, credit ratings and recommendations

- Scandi high yield

3 3

What's on our minds - General credit market news

Source: Bloomberg, Danske Bank Markets (both charts)

• The past week has indicated some further positive momentum

for corporate bonds and credit spreads have grinded tighter. The most interesting transaction came in the corporate space as Vodafone issued a total of EUR6bn of bonds with maturities ranging from three to 10 years. In the largest corporate issue in EUR for about a year, which attracted a total of EUR13.5bn of orders, Vodafone offered investors both some new issue concessions and the inclusion of a change of control clause.

• Positively, the US high-yield market has noted its second week in a row of inf lows (USD2.7bn). While not really large, it is still an indication of investors now seeing value in the US high-yield market at current yield levels. The market has also found some new support from the recently rising oil price, which somewhat improves the outlook for the struggling energy and oil sector.

• New macro data showed that Swedish GDP grew by a surprisingly large amount in Q4 15, with year-on-year growth of 4.5%. We have previously highlighted the benign outlook for the (Swedish) real estate and construction sectors for 2016 and this supports this view. Retail corporates focused on Sweden such as ICA Gruppen (our rating 'BBB') and Lantmännen (our rating 'BBB-') should also be beneficiaries. We believe that Lantmännen's SEK Dec. 2020 bond is trading at an attractive level.

• This week we present a new trade idea on the Nov 2021 4.875% EUR bond issued by Investor AB, which appears attractively priced considering Investor's strong financial profile. See page 12 for further information.

4 4

Scandi high yield

5 5

Recent trade ideas (high yield)

Source: Danske Bank Markets

See the end of this document for a list of our coverage including shadow ratings and recommendations.

Type Trade Idea Opened 17 Feb 2016 Start spread 455

Opened 18 Jan 2016

Start spread 497

Opened 14 Jan 2016

Start spread 467

Opened 13 Jan 2016

Start spread 777

Opened 7 Dec 2015

Start spread 692

Opened 27 Oct 2015 Start spread 105 Opened 27 Oct 2015 Start spread 569

Opened 1 Oct 2015

Start spread -27

Opened 1 Oct 2015

Start spread 6

Outright Buy Stena EUR2017 Attractive valuation 2017 bond. We remain underweight all other Stena bonds

Outright Buy Tallink NOK 2018 FRN Trading at an attractive spread following recent widening

Outright Sell DONG Energy call 2023 The long end of the DONG Energy hybrid curve is too tight

Outright Buy SSAB EUR2019 The SSAB EUR2019 currently trades at very attractive levels compared with other outstanding SSAB bonds

and compared with the current 'BB-' rating from S&P

Outright Buy Norwegian Air Shuttle

EUR2019

The Norwegian Air Shuttle EUR2019 currently trades At very attractive levels compared with other outstanding NAS bonds and compared with our 'B+'/NO shadow rating.

Switch Buy Color Group NOK 2019,

Sell Tallink NOK 2018

Color Group spread pickup attractive versus Tallink

Outright Buy Color Group NOK 2019 Spread wide for the assessed rating

Switch Sell Stena 2020,

Buy TDC hybrid

Fundamentally, we see increased credit risk in Stena

And recommend investors switch into names with

the same or stronger credit profiles such as TDC (hybrid).

Switch Sell Stena 2020,

Buy Volvo hybrid

Fundamentally, we see increased credit risk in Stena

And recommend investors switch into names with

the same or stronger credit profiles such as Volvo (hybrid).

6 6

Best and worst performers (Nordic coverage universe) - High yield


1 month in local currencies YTD in local currencies

3,108

3,108

2,850

2,522

2,522

1,649

1,183

1,141

1,024

948

3

3

1

-12

-16

-50

-59

-81

-82

-103

-5000500100015002000250030003500

BW Offshore Ltd NOK 2017


Farstad Shipping ASA NOK 2017




North Atlantic Drilling Ltd USD 2019


North Atlantic Drilling Ltd NOK 2018

Prosafe SE NOK 2017

Akelius Residential Property AB SEK …

Nokia OYJ USD 2019

Ahlstrom OYJ EUR 2019

Stena AB EUR 2017

Fred Olsen Energy ASA NOK 2019

Meda AB SEK 2019

Meda AB SEK 2018

Seadrill Ltd USD 2017

Outokumpu OYJ EUR 2019

SSAB AB EUR 2019

Change in local currencies (bp)

3,331

3,331

3,275

3,192

2,939

2,848

2,691

2,691

2,616

2,088

16

9

6

4

2

-12

-13

-17

-51

-61

-500500150025003500



Seadrill Ltd NOK 2018

Farstad Shipping ASA NOK 2017

North Atlantic Drilling Ltd NOK 2018

Seadrill Ltd USD 2017



Seadrill Ltd SEK 2019

North Atlantic Drilling Ltd USD 2019

Orava Residential REIT PLC EUR 2020

Ahlstrom OYJ EUR 2019

Stora Enso OYJ SEK 2017

Akelius Residential Property AB SEK …

Beerenberg Holdco II AS NOK 2018

Outokumpu OYJ EUR 2019

SSAB AB EUR 2019

Hoist Kredit AB SEK 2016

Meda AB SEK 2019

Meda AB SEK 2018


7 7

Danske Bank Markets Nordic High-Yield Index

Source: Bloomberg, Danske Bank Markets [all tables and charts]

Danske Bank Markets Nordic High-Yield Index

Index sector breakdown Key index statistics

• Last week, we saw volatility in the European high-yield markets. iTraxx Crossover started last week at 426bp, peaked intra-week at 443bp and ended the week unchanged at 426bp. The market seems sensitive to negative news at the moment.

• At the deadline for this publication iTraxx Crossover is trading around 429bp – a slight widening from last week.

• The ASW on our DBM High-Yield Index tightened moderately (-4bp) over the week.

• We saw no new issuance on the Scandi high-yield markets last week. We are still awaiting the first major Scandi high-yield transaction in 2016.

Basic Materials

12%Communicat

ions8%

Consumer, non-cycli.

10%

Energy14%

Diversified4%

Industrial19%

Consumer, Cyclical

9%

Utilities7%

Real estate13%

Technology2%

300325350375400425450475500525550575600625

94.0

96.0

98.0

100.0

102.0

104.0

106.0

Dec/2014 Mar/2015 Jun/2015 Sep/2015 Dec/2015

DBM Hedged EUR Nordic HY Index Value

DBM Nordic HY Index, ASW-spread (bps). RHS

Index start Index end Change

Date 31/Dec/2014 26/Feb/2016

Yield 5.9%

ASW spread, bps 430 596 166

# Bonds 107

AVG credit rating BB

Avg duration 2.9

TR since start -1.7%

TR YTD -3.1%

TR MTD -0.7%

8 8

Recent Nordic high-yield issuance

Source: Bloomberg, Danske Bank Markets

Selected new issues (High Yield)

Date Issuer Coupon CCY Volume Maturity S&P / Mdy / Fitch ASW/DM

16/02/2016 Studsvik Ab STIB3M +650bps SEK 300 m Feb/19 / / 650

03/02/2016 Scandi Biogas Fuels STIB3M +975bps SEK 200 m Feb/20 / / 975

25/01/2016 Moberg Pharma STIB3M +600bps SEK 300 m Jan/21 / / 600

15/12/2015 Bulk Industrier As NIBOR3M +700bps NOK 200 m Dec/18 / / 700

15/12/2015 Bong Ab 10% SEK 200 m Dec/18 / / 1024

11/12/2015 Barcode 121 Holding Ag 3.75% NOK 2 535 m Dec/24 / / 232

11/12/2015 B121 Holding As 5.75% NOK 390 m Dec/20 / / 444

10/12/2015 Stockmann Ab (Hybrid) 7.75% EUR 85 m PERP / / 717

09/12/2015 West Atlantic Ab 6.5% SEK 850 m Dec/19 / / 611

01/12/2015 Norwegian Air Shuttle As 7.25% EUR 125 m Dec/19 / / 700

19/11/2015 Ab Stena Metall Finans STIB3M +350bps SEK 1 000 m Nov/20 / / 350

17/11/2015 Jefast Holding Ab STIB3M +650bps SEK 200 m Jan/19 / / 650

13/11/2015 Vattenfall Ab (Hybrid) 6.1% USD 400 m Nov/78 BB+ / Baa2 /*- / BBB- 406

29/10/2015 Marine Harvest Asa (Convertible) 0.125% EUR 340 m Nov/20 / / -

26/10/2015 Ssab Ab STIB3M +250bps SEK 300 m Apr/18 BB- *- / / 250

21/10/2015 Verisure Holding Ab STIB3M +725bps SEK 2 816 m Oct/23 CCC+ / B1 / 725

21/10/2015 Verisure Holding Ab EUR003M +725bps EUR 400 m Oct/23 CCC+ / B1 / 725

23/10/2015 Verisure Holding Ab 6% EUR 700 m Nov/22 B / B1 / 591

01/10/2015 Finnair Oyj (Hybrid) 7.875% EUR 200 m PERP / / 754

16/09/2015 Akelius Residential Ab 3.375% EUR 300 m Sep/20 BB+ / / 300

03/09/2015 Lock As 7% EUR 30 m Aug/21 B+ / / 505

03/09/2015 Lock As 5.5% EUR 200 m Aug/20 B+ / B2 / 550

03/09/2015 Np3 Fastigheter STIB3M +490bps SEK 300 m Oct/18 / / 490

02/09/2015 Sagax Ab EUR006M +350bps EUR 30 m Sep/20 / / 350

9 9

Company news from the past week (high yield)


Name News Implication

FastPartner

FastPartner (Danske rating 'BB/BB-') reported strong Q4 earnings on Thursday. During Q4, rental income rose by 27%, with 29% growth in operating profit. Growth came mainly from earlier acquired properties. Like other property companies, there was a valuation gain in the property portfolio in the quarter (SEK118m) due to lower required yields. Further property acquisitions were made in the quarter but the net LTV remained unchanged from Q3 at 63% (65% if we also include 50% of preference shares in debt). All in all, the Q4 performance supports our 'BB' credit view on FastPartner with its bonds at 'BB-' due to structural subordination.

Credit positive

REM Offshore

We downgrade REM Offshore from 'B-' to 'CCC+'. Supporting the credit is the asset base, while the fleet composition, diversity in terms of assets and geography and high financial leverage all weigh negatively.

Credit negative

Beerenberg

Beerenberg delivered another strong quarterly result, with strong margins and solid cash generation. The order backlog has increased significantly and is now at approximately NOK13bn, providing good visibility for coming years. The company is still involved with tenders and retenders of the existing backlog and we argue that strong cost control and good margins bode well for its competitiveness when fighting for increased market share. We increase our estimates for 2016-17 and highlight strong revenue coverage, solid cash flow generation and liquidity, in addition to a comfortable loan-to-value ratio based on average industry multiples.

Credit positive

Seadrill

Seadrill's ('B-' unsecured) Q4 15 EBITDA of USD513m was in line with SME Direkt consensus and 5% ahead of our estimate, on a good operating quarter. The company said 2016 liquidity is good (as we expected) and that it aims to communicate its 'funding plans' in the first half of 2016 (we expect nothing until the Q1 16 report in late May at the earliest). Sevan Driller's contract in Brazil was suspended on 1 December 2015, as commercial negotiations with Petrobras continue (the rig was a termination candidate in Petrobras' fleet, contract ending June 2016). Seadrill announced USD260m of sustainable cost savings in 2016 versus 2015, 13% of the 2015 cost base and 11% of 2016 EBITDA (we expected USD200m) and said it intends to take no rig deliveries in 2016 (as we expected). Q1 16 EBITDA guidance of USD450m is in line with our estimate. All in all, we consider the results fairly neutral versus expectations.

Credit neutral

10 10

Company news from the past week (high yield)



J. Lauritzen

J. Lauritzen ('B/B-') reported EBITDA of USD-11m versus our estimate of USD-18.3m. Net profit was USD-24m versus our estimate of USD-30.1m when adjusting for USD130.6m of impairment costs. The cash position is stronger than we feared at USD115.5m and net debt was USD284m, largely in line with our estimate of USD287m. More importantly, J. Lauritzen has agreed with Lauritzen Fonden to inject new capital of approximately USD19m and transfer a number of non-strategic assets and obligations to LF Investment ApS, which is wholly owned by Laurtizen Fonden. The transactions provide J. Lauritzen with additional cash of USD125m in 2016 and the assets have a combined book value of USD105.9m. Importantly, the transaction includes transfer of the shareholding in Axis Offshore, which represented a key risk for the J. Lauritzen credit related to a potential USD53m of capex outlays this year. Our first take is that this is clearly positive for the J. Lauritzen credit. The company guides that 2016 EBITDA will be similar to 2015 EBITDA, which does not surprise us, as, in our view, rates for its Dry Bulk division cannot drop much more. We believe the 2016 results will be positively affected by reduced depreciation following the sale of assets and net finance will be reduced after debt repayments and deleveraging of its balance sheet. The company continues to sell assets and get rid of debt, as its close to impossible to survive in the current dry bulk market with a debt-laden balance sheet. The company has sold nine owned and five part-owned dry bulk vessels. NIBD equals 57% of broker values, which is positive. The company's 5.1% stake in Hafnia Tankers, currently valued at USD26.4m, has also been transferred to Lauritzen Fonden (Lf Investment ApS).

Credit positive

SSAB

SSAB (UW): As expected S&P downgraded SSAB one notch last Monday from 'BB-' to 'B+'. However, somewhat surprisingly, S&P has kept SSAB on CreditWatch negative, which indicates that it could make another downgrade very soon, unless market conditions begin to improve. We had thought it would change the outlook to negative, which would have given SSAB slightly more time to turn things around. The hope for SSAB now is that the recently implemented EU tariffs on cold-rolled steel will start to push prices up but such measures are not always as effective as anticipated. We keep our Underweight recommendation on SSAB and we expect this to affect spreads negatively.

Credit negative

Nynas

Nynas's Q4 15 results were strong. Clean EBITDA improved significantly due to higher sales volumes and margin expansion. Nynas was able to continue its deleveraging despite higher capex and a seasonally weak quarter. Current credit metrics are now very strong relative to our 'B+' shadow rating but we need to see more stability before upgrading. Overall, we view this as a credit positive report from Nynas and we still think the NYNAAB 18s look attractive.

Credit positive

11 11

Scandi investment grade

INVSA FRN '17 (SEK)

INVSA 6.08% '19 (NOK)

INVSA 5.25% '22 (NOK)

INVSA 5.25% '19 (SEK)

INVSA 4.875% '21 (EUR) INVSA 4.5% '23

(EUR)

INVSA 3.25% '18 (EUR)

Industrials AA's

Industrials A+

0

10

20

30

40

50

60

70

80

90

100

1 2 3 4 5 6 7 8 9 10 11 12

Mid Spread

(EUR)*

YTW**

* Z-spreads. OAS for floaters. Swapped to indicated currency. ** Years-to-worst

Note: Fair value curve(s) based on Danske Bank Markets' (mid) peer group of European issuers

Relative value (EUR), indicative mid spreads Credit spread development


Key arguments for the trade

• We believe the spread on the INVSA 2021 is too wide.

Compared with average spreads for industrials with high (AA) ratings, the INVSA '21 is trading much too wide.

• Recent decoupling from average AA spread. Investor was hurt by the widening trend late last year, widening significantly relative to average AA corporate spreads

• Strong Q4 report. In late January, Investor released a strong report for Q4 with significant deleveraging in 2015, leaving it well prepared for market turmoil

Buy Investor AB 2021 (EUR) – spread far too wide

• Stable credit quality. It could be argued that Investor has been hurt by recent sell-off in bank stocks (it is a key shareholder of SEB) but the company's AA/Aa3 ratings are well anchored and recent deleveraging underpins the strong financial position in this environment

• Recommendation. We particularly like the INVSA 4.875% EUR bond maturing in 2021 but note that the '23 is also wide compared with rating category averages. We currently have an Overweight recommendation on INVSA bonds.


0

5

10

15

20

25

30

35

40

45

50

0

10

20

30

40

50

60

70

80

90

100

Jan-15 Feb-15 Apr-15 Jun-15 Jul-15 Sep-15 Oct-15 Dec-15 Feb-16

INVSA_EUR : 5Y AA_CORP_EUR : 5Y INVSA_EUR : 5Y - AA_CORP_EUR : 5Y

Published on 29 February 2016

Key arguments for the trade

• Attractive pickup. The ask price indicates 10bp to the EUR Financials senior AA- curve (mid) and 8bp to SEB EUR 2% '21 (mid) for six months longer maturity.

• New issue still trading wider than incumbents. Issued a week ago at +73 versus mid swaps, the SEB 0.75% '21 still trades wide compared with other Swedish banks' senior bonds with similar maturities. In our view, it should tighten to their level in coming months and trade closer to the EUR Financials senior AA- curve like its shorter maturities.

Buy SEB EUR 0.75% 2021 – attractive pickup from a relative value perspective

• A clean play on the Swedish economy. While Nordea's 2023 new issue also trades wider than the AA- curve, we prefer SEB due to Nordea's diversification leaving it vulnerable (exposure to energy, shipping, Russia and Finland and risk related to loss guarantee to divested business in Poland).

• New issue risk. Most large Nordic banks have been in the EUR senior market with a 5-7Y maturity bond since December, except Danske Bank and Swedbank, so SWEDA 0.625% '21 and SWEDA1% '22 are more exposed to new issue risk.

See relative value chart on next page



Buy SEB EUR 0.75% 2021 – attractive pickup from a relative value perspective

SWEDA (Aa3/AA-) 1.5% '19

SWEDA (Aa3/AA-) 1% '22

SWEDA (Aa3/AA-) 0.625% '21SHBASS (Aa2/NR) 2.625% '22

SHBASS (Aa2/NR) 2.25% '20

SHBASS (Aa2/AA-) 3.375% '17

SHBASS (Aa2/AA-) 2.25% '18

SHBASS (Aa2/AA-) 1.125% '22SEB (Aa3e/A+) 0.75% '21

SEB (Aa3/A+) 4.25% '18SEB (Aa3/A+) 3.875% '17

SEB (Aa3/A+) 2% '21

SEB (Aa3/A+) 1.875% '19

NDASS (Aa3e/AA-) 1% '23

NDASS (Aa3/AA-) 4% '20

NDASS (Aa3/AA-) 3.25% '22

NDASS (Aa3/AA-) 1.375% '18

NDASS (Aa3/AA-) 1.125% '25Financials senior AA-

Financials senior A+

0

10

20

30

40

50

60

70

80

90

100

1 2 3 4 5 6 7 8 9 10

Ask Spread (EUR)*

YTW**

* Z-spreads. Discount margin for floaters. Swapped to indicated currency. ** Years-to-worstNote: Fair value curve(s) based on Danske Bank Markets' (mid) peer group of European issuers


15 15

Recent trade ideas (investment grade)


See the end of this document for a list of our coverage including shadow ratings and recommendations

Type Trade Idea

Opened 29 Feb 2016

Start spread 86

Opened 25 Feb 2016

Start spread 67

Opened 2 Feb 2016

Start spread 406

Opened 25 Jan 2016

Start spread 175

Opened 25 Jan 2016

Start spread 114

Opened 30 Nov 2015

Start spread 86

Opened 16 Nov 2015

Start spread 161

Opened 9 Nov 2015

Start spread 16

Outright Buy DNA EUR 2018 We see attractive value in the DNA 2018s.

Buy SEB EUR 0.75% 2021 Ask price indicates an attractive 10bp pickup to EUR Financials senior AA-curve (mid) and a 8bp pickup to SEB EUR 2% '21 (mid) for six months longer maturity.

Outright Buy NYKRE T2 CoCo '36 (first

call '21) (revisited)

Nykredit has issued a tier 2 bond as a CoCo with a 7% trigger. We believe the T2 CoCo trades at a discount to peers because of the CoCo feature.

Outright Buy INVSA EUR 4.875% 2021 Spread on the INVSA 2021 has widened recently and is too wide compared with average spreads for industrials with high (AA) ratings.

Outright

Outright Buy DNA EUR 2021 We see attractive value in the DNA 2021s.

Outright Buy DFDS NOK FRN 2016 Short FRN trades attractively on both an RV and

absolute basis.

Outright Close of buy Neste EUR2022 We close our Buy Neste 22s trade recommendation.

Switch Buy Securitas EUR 2021, Sell

G4S EUR 2018

One notch higher rating and no risk of near-term M&A

for Securitas means the pickup is attractive.

16 16

Best and worst performers (Nordic coverage universe) - Investment grade


1 week in local currencies 1 month in local currencies

18

18

18

18

18

17

15

14

12

10

-2

-3

-3

-3

-3

-3

-5

-7

-7

-8

-10-505101520

Fortum Varme Holding samagt med …






Nibe Industrier AB SEK 2019

Nibe Industrier AB SEK 2020

Scania CV AB SEK 2017

Danske Bank A/S EUR 2017

Nordea Bank AB EUR 2017

Telenor ASA EUR 2018

Swedbank AB EUR 2022

Svenska Handelsbanken AB EUR 2021


DONG Energy A/S EUR 2021


Statoil ASA EUR 2025

Sampo Oyj SEK 2020

Jyske Bank A/S EUR 2018


60

31

31

24

24

22

20

19

19

19

-6

-7

-7

-7

-8

-8

-8

-9

-10

-20

-40-20020406080

Sampo Oyj SEK 2020

Sampo Oyj EUR 2021


Nordea Bank AB EUR 2022

DNB Bank ASA EUR 2021

Swedbank AB EUR 2022

Kemira OYJ EUR 2022

Pohjola Bank Oyj EUR 2020

Metso OYJ EUR 2019

Danske Bank A/S EUR 2020

Svenska Cellulosa AB SCA EUR 2023




Elisa OYJ EUR 2021

Statkraft AS EUR 2019

Vattenfall AB EUR 2019


Statoil ASA EUR 2025

Vestas Wind Systems A/S EUR 2022


17 17

Selected new investment-grade issues


Date Issuer Coupon CCY Volume Maturity S&P / Mdy / Fitch ASW/DM

26/02/2016 Danske Bank A/S EUR003M +90bp EUR 100m Mar-18 A / A2 / A 90

26/02/2016 Unicredit SPA 2% EUR 1,000m Mar-23 BBB- / Baa1e / BBB+e 190

25/02/2016 Ubs Group Funding 2.125% EUR 750m Mar-24 / Baa2 / Ae 190

24/02/2016 LVB International Finance 1.875% EUR 750m Mar-22 BBB / Baa1 / 182

24/02/2016 Kragero Sparebank NIBOR3M +125bp NOK 100m Feb-18 / / 125

23/02/2016 Uppsalahem AB STIB3M +97bp SEK 300m Mar-20 AA- / / 97

22/02/2016 Vodafone Group plc 1.25% EUR 1,250m Aug-21 BBB+ / Baa1 / BBB+e 123



22/02/2016 Vodafone Group plc EUR003M +95bp EUR 1,750m Feb-19 BBB+ / Baa1 / BBB+e 95

22/02/2016 Deutsche Bahn Finance BV 0.75% EUR 500m Mar-26 / Aa1e / 28

22/02/2016 Sveaskog AB 1.49% SEK 700m Mar-21 / / -

22/02/2016 Sveaskog AB STIB3M +120bp SEK 300m Mar-21 / / 120

22/02/2016 Skandiabanken ASA NIBOR3M +58bp NOK 300m Feb-17 / A3 / 58

18 18

Company news from the past week (investment grade)



Statkraft

Statkraft's (MW) 'A-' rating has been lowered to negative outlook from stable. Just like Vattenfall, this reflects relatively weak current financial metrics coupled with fading power prices in Norway. However, this is partially offset by Statkraft's high share of fixed price contracts in Norway and a highly flexible capex budget. Statkraft has stated that it targets maintaining its current S&P rating, so it will be interesting to see whether the company will undertake further capex reductions.

Credit negative

Vattenfall

Vattenfall's (MW) 'BBB+' rating has been put on watch negative from negative outlook. This follows a revision of S&P's outlook for European utilities in the wake of lower power prices and a tough regulatory regime, especially in Germany. Given Vattenfall's exposure to Germany and its current weak financial metrics, the negative rating action should not come as a complete surprise to the market. S&P expects to resolve the negative watch within 90 days.

Credit negative

Nokian Tyres

Nokian Tyres (NR) is potentially involved in a VW-type manipulation scandal. According to Finnish media, Nokian Tyres has for years been sending high-quality tyres for official quality stamps, while sending out tyres of lower quality to its retailers. As such, this story draws parallels with the VW ‘Diesel-gate’ scandal, which led to significant losses on VW’s share price and multi-notch downgrades of its ratings. So far, there has been no comment from Nokian Tyres but the share prices has fallen over 10%. This is credit negative given what we know now. Should this story prove to have some merit, it would be likely to cause us to adjust our ‘BBB+’ shadow rating on Nokian Tyres.

Credit negative

TVO

TVO (OW) gets some positive signals from Areva’s FY 2015 results. In its report, Areva mentions it has taken an additional impairment on the OL3 project of EUR905m. Among other things, this reflects ‘the probable impact of initiated discussions with the customer aiming at ensuring the completion of the OL3 project and to settle the disputes’. This could be a signal that Areva is willing to pay some degree of damages to TVO regarding the much-delayed OL3 project. To recap.,TVO has sued Areva for EUR2.6bn for the delay, while Areva has sued TVO for EUR3.5bn blaming it for being responsible for the delay. On another positive note, Areva confirmed it continues to expect a start-up in late 2018, in line with previous communications. Overall, this is slightly positive newsflow for TVO. This said, the weak Areva report also illustrates the poor condition it is in and that it is quite dependant on economic help from France and/or EdF. Given the importance of the nuclear industry for France, we expect France to provide the help needed to keep Areva alive. This said, we caution that continued weakness in Areva could jeopardise the construction timeline for OL3, which would be credit negative.

Credit positive

19 19




Swedish banks

The Swedish FSA released its supervisory report on Thursday last week. It included nothing new when it comes to risk weights, as the FSA is still looking into the banks’ internal models. However, it says that it has found defects in the current models and expects to come up with solutions for these in the near term. So, we still expect higher risk weights shortly, probably as a Pillar 2 add-on. This said, the big unknown continues to be Basel 4, which we expect news on at the end of 2016, so status quo.

Credit neutral

Nordic banks

On Wednesday evening, the EBA announced the conditions for this year's stress test of the European banks. It looks likely to be a relatively uneventful exercise, as the stressed capital ratios will not be disclosed to the market but instead used by the authorities to asses the individual banks' capital requirements. Even so, this stress test is normally a non-event for the Nordic banks as they tend to pass with flying colors. We expect the test to be finalised in Q3. All Nordic banks down to Sydbank are due to participate.

Credit neutral

TeliaSonera

TeliaSonera (UW): Reports suggest Telia may soon receive a bid for its Spanish division (Yoigo) from Masmovil, indicating offers could lie in the EUR500-600m (c. SEK5-6bn) range. Telia has been trying to sell the unit since 2012 but withdrew it from sale due to a lack of attractive offers. If Telia manages to sell both Yoigo and its debt colleting agency (Sergel), it could reduce leverage by some SEK7-8bn, corresponding to roughly 0.2x in adjusted net debt to EBITDA. As Yoigi (Spain) is Telia’s worst-performing unit, the loss at the EBITDA level would be minor (Yoiga had an EBITDA margin of c.9.5% in 2015 compared with c.29% at a group level). Overall, we consider this positive and believe it should take a little pressure off the negative outlook from Moody’s.

Credit positive

TeliaSonera

TeliaSonera (UW): Possible divestment of Sergel could bring in c.SEK1.5-2.0bn. Potential buyers include Arvato, Lindorff and Intrum Justitia according to reports. Telia's A3 rating is currently on watch negative at Moody's and the amount from this sale is unlikely to remove this. However, it is still a sign of good faith from Telia and, in our view, it is likely it would not be too worried about a downgrade as the group officially targets an ‘A-’ to ‘BBB+’ rating. We maintain our Underweight recommendation.

Credit neutral

Sydbank

Sydbank’s Q4 results were relatively uneventful in our view but once again highlighted the good asset quality story in the bank. With only one remaining senior EUR benchmark bond outstanding (maturing in October 2016), we remain neutral on the name. Hence, our Marketweight recommendation.

Credit positive

20 20




Jyske Bank

With its profits already preannounced, Jyske reported slightly better quality Q4 15 results than we expected, with an increase in core income. Asset quality continued to improve and liquidity remained sound. Despite an increase in the planned capital distribution to shareholders in 2016, Jyske remained well capitalised and it again stated that it will explore opportunities to issue subordinated capital in coming quarters. We prefer Jyske over its peers due to larger earnings visibility and expectations of continued improved asset quality and thus keep our Overweight recommendation.

Credit positive

21 21 Credit Indicators

Credit indicators

22 22

Chart pack: euro spreads and returns

Source: Macrobond Financial, Danske Bank Markets [all charts]

Euro IG ASW, iBoxx indices

Euro HY ASW, Merrill Lynch indices

IG total return, iBoxx indices, 2014-01=100

HY total return, Merrill Lynch indices, 2014-01=100

23 23

Chart pack: relative value iTraxx vs iBoxx

Euro vs US CDS indices - IG (Markit)

EUR CDS spreads – Nordic banks

Euro vs US HY bond indices (Merrill Lynch)


24 24

Chart pack: general market development

Source: Macrobond Financial , Danske Bank Markets [all charts]

European swap and government yields

Euro swap curve spread

3M Libor, US and euro area

EUR/USD basis swaps

25 25

Chart pack: high-yield funds flow

Source: Bloomberg, Danske Bank Markets [all charts]

High-yield Europe ETF fund flow High yield US ETF fund flow

0

500

1,000

1,500

2,000

2,500

Dec-2014 Mar-2015 Jun-2015 Sep-2015 Dec-2015

Cu

mu

lati

ve E

TF

-flo

w M

EU

R

High Yield - Europe - Fixed Income

-1,000

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

Dec-2014 Mar-2015 Jun-2015 Sep-2015 Dec-2015

Cu

mu

lati

ve E

TF

-flo

w M

EU

R

High Yield - North America - Fixed Income

26 26

Chart pack: fund flows


Europe, net sales

Sweden, net sales

US, net sales

Norway, net sales

27 27

Chart pack: macro


GDP y/y growth, calendar adjusted

Euro area y/y change in bank lending

Purchasing Manager Indices

Euro area lending standards

28 28

Coverage universe, credit ratings

and recommendations

29 29

Our coverage and shadow ratings 1 of 6

Source: Standard & Poor's, Moody's, Fitch, Danske Bank Markets

Ratings from S&P/Moody's/Fitch and Danske Bank Markets shadow ratings

Analyst(s)

Company Rating Outlook Sr. Unsec Rating Outlook Rating Outlook Rating OutlookAhlstrom Oyj BB- Stable M. Rosendal / J. MagnussenAkelius Residential Property Ab BBB- Stable E. Hjalmarsson / L. Landeman OVERWEIGHTAktia Bank Oyj L. Holm / K. JensenAlandsbanken Abp BBB Neg L. Holm / K. JensenAmbu A/S BBB- Stable J. Magnussen / M. RosendalAp Moeller - Maersk A/S BBB+ Neg Baa1 Stable B. Børsting/J. Magnussen MARKETWEIGHTArla Foods Amba BBB Stable G. Bergin / L. LandemanAtlas Copco Ab A Stable A2 Stable A Stable B. Børsting / M. Rosendal UNDERWEIGHTAvinor As AA- Stable A1 Stable G. Bergin / L. Landeman MARKETWEIGHTBank 1 Oslo Akershus As BBB+ Stable L. Holm / K. JensenBank Norwegian As BBB Stable L. Holm / K. JensenBeerenberg Holdco Ii As B Stable Ø. MossigeBillerudkorsnas Ab BBB- Pos M. Rosendal / L. LandemanBw Offshore BB+ Stable Ø. MossigeCarlsberg Breweries A/S Baa2 Neg BBB Stable B. Børsting / M. Rosendal MARKETWEIGHTCastellum Ab BBB- Stable L. Landeman / P. AhmarinejadCermaq Asa BB Stable K. BakkenCitycon Oyj BBB Stable Baa1 Stable E. Hjalmarsson / L. Landeman OVERWEIGHTColor Group As BB- Stable B+ N. Ripa / B. BørstingCom Hem Holding Ab BB- Pos M. Rosendal / J. MagnussenCorem Property Group Ab BB- Stable B+ E. Hjalmarsson / L. LandemanDanfoss A/S BBB Stable J. Magnussen / B. BørstingDanske Bank A/S A Stable A2 Stable A StableDeep Sea Supply Plc B- Neg I. Båtvik / Ø. MossigeDestia Group Oy BB- Stable B+ E. Hjalmarsson / L. LandemanDfds A/S BBB- Stable N. Ripa / B. BørstingDlg Finance As BB- Stable M. Rosendal / B. BørstingDna Ltd BBB- Stable M. Rosendal / J. MagnussenDnb Bank Asa A+ Neg Aa3 Stable L. Holm / K. Jensen UNDERWEIGHTDof Asa B+ Neg I. Båtvik/Ø. MossigeDof Subsea As B+ Neg I. Båtvik/Ø. MossigeDolphin Group As I. Båtvik

Recomm.Danske Bank S&P Moody's Fitch

30 30




Analyst(s)

Company Rating Outlook Sr. Unsec Rating Outlook Rating Outlook Rating OutlookDong Energy A/S BBB+ Stable Baa BBB+ Stable J. Magnussen / L. Landeman MARKETWEIGHTDsv A/S BBB Stable B. Børsting / M. RosendalEg Holding B Stable J. Magnussen / N. RipaEidesvik Offshore Asa B Neg I. Båtvik / Ø. MossigeEika Boligkreditt As A- Stable L. Holm / K. JensenEika Forsikring As BBB+ Stable L. Holm / K. JensenEika Gruppen As BBB Stable L. Holm / K. JensenEksportfinans Asa BBB- Pos Ba3 Stable L. Holm / K. JensenElectrolux Ab BBB+ Stable Wr WD G. Bergin / B. Børsting MARKETWEIGHTElenia Oy BBB J. Magnussen / L. Landeman MARKETWEIGHTElisa Oyj BBB+ Stable Baa2 Stable M. Rosendal / J. Magnussen MARKETWEIGHTFarstad Shipping Asa B Stable B- I. Båtvik / Ø. MossigeFastpartner Ab BB Stable BB- L. Landeman / E. HjalmarssonFingrid Oyj A+ Pos A1 Stable A+ Stable J. Magnussen / L. Landeman MARKETWEIGHTFinnair Oyj BB Stable B. Børsting / M. RosendalFortum Oyj BBB+ Stable Baa1 Stable BBB+ Stable J. Magnussen / L. Landeman UNDERWEIGHTFortum Varme Holding Samagt Med Stockholms Stad Ab BBB+ Stable J. Magnussen / L. LandemanFred Olsen Energy Asa B+ Neg B S. Stormyr / B.K. RøedG4S Plc BBB- Stable B. Børsting / M. Rosendal MARKETWEIGHTGetinge Ab BB Stable L. Landeman / E. HjalmarssonGolar Lng Partners Lp BB Stable BB- B.K. Røed / J. MeyerGolden Close Maritime Corp Ltd B- S. Stormyr / B.K. RøedHavila Shipping Asa CCC+ Neg I. Båtvik / Ø. MossigeHeimstaden Ab BB Stable BB- L. Landeman / E. HjalmarssonHemso Fastighets Ab A- Stable E. Hjalmarsson / L. Landeman MARKETWEIGHTHexagon Ab BBB- Stable E. Hjalmarsson / L. LandemanHkscan Oyj BB Stable B. Børsting / M. RosendalHoegh Lng Holdings Ltd BB- Stable B+ B.K. Røed / J. MeyerHoist Kredit Ab BB- Stable B+ G. Bergin / L. LandemanHusqvarna Ab BBB- Pos E. Hjalmarsson / L. LandemanIca Gruppen Ab BBB Stable G. Bergin / L. LandemanIkano Bank Ab BBB Stable L. Holm / K. JensenInvestor Ab AA- Stable Aa3 Stable G. Bergin / B. Børsting OVERWEIGHT


31 31




Analyst(s)

Company Rating Outlook Sr. Unsec Rating Outlook Rating Outlook Rating OutlookIss A/S BBB- Pos B. Børsting / M. Rosendal OVERWEIGHTJ Lauritzen A/S B Stable B- B.K. Røed / J. MeyerJefast Holding Ab B Stable B E. Hjalmarsson / L. LandemanJernhusen Ab A- Stable E. Hjalmarsson / L. LandemanJyske Bank A/S A- Stable Baa1U Stable L. Holm / K. Jensen OVERWEIGHTKemira Oyj BBB- Stable Wr M. Rosendal / L. LandemanKesko Oyj BBB Neg G. Bergin / L. LandemanKlaveness Ship Holding As BB- Stable B+ B.K. Røed / J. MeyerKlovern Ab BB+ Stable BB E. Hjalmarsson / L. LandemanLantmannen Ek For BBB- Stable G. Bergin / L. LandemanLoomis Ab BBB Stable B. Børsting / M. RosendalLuossavaara-Kiirunavaara Ab BBB Stable L. Landeman / E. HjalmarssonMeda Ab BB- Stable L. Landeman / E. HjalmarssonMetsa Board Oyj BB+ Pos Ba2 Stable M. Rosendal / E. Hjalmarsson OVERWEIGHTMetso Oyj BBB Stable Baa2 Stable B. Børsting / M. Rosendal MARKETWEIGHTNcc Ab BBB- Stable E. Hjalmarsson / L. LandemanNeste Oyj BBB- Stable J. Magnussen / L. Landeman MARKETWEIGHTNibe Industrier Ab BBB- Stable E. Hjalmarsson / L. LandemanNokia Oyj BB+ Pos Ba2 Stable BB Pos M. Rosendal / J. Magnussen MARKETWEIGHTNokian Renkaat Oyj BBB+ Stable J. Magnussen / M. RosendalNordax Bank Ab BBB- Stable L. Holm / K. JensenNordea Bank Ab AA- Neg Aa3 Stable AA- Stable L. Holm / K. Jensen UNDERWEIGHTNorth Atlantic Drilling Ltd B- Neg CCC+ S. Stormyr / B.K. RøedNorwegian Air Shuttle Asa B+ Neg B B. Børsting / M. RosendalNykredit Bank A/S A Neg Baa3U Stable A Stable L. Holm / K. Jensen OVERWEIGHTNynas Group B+ Stable B+ J. Magnussen / L. LandemanOcean Rig Udw Inc CCC Ca Neg S. Stormyr / B.K. RøedOcean Yield Asa BB BB- Ø. MossigeOdfjell Se B+ Stable B B.K. Røed / J. MeyerOlympic Ship As B+ Stable B I. Båtvik/Ø. MossigeOrava Residential Reit Plc B+ Stable B+ E. Hjalmarsson / L. LandemanOutokumpu Oyj B- Neg M. Rosendal / E. Hjalmarsson


32 32




Analyst(s)

Company Rating Outlook Sr. Unsec Rating Outlook Rating Outlook Rating OutlookPacific Drilling Sa B- Neg Caa2 Neg S. Stormyr / B.K. RøedPetroleum Geo-Services Asa CCC+ Neg B1 I. BåtvikPohjola Bank Oyj AA- Neg Aa3 Stable WD L. Holm / K. Jensen OVERWEIGHTPostnord Ab BBB+ Stable G. Bergin / L. LandemanProsafe Se B+ Neg B S. Stormyr / B.K. RøedRamirent Oyj BB+ Stable B. Børsting / M. RosendalRem Offshore Asa CCC+ Stable I. Båtvik / Ø. MossigeSaab Ab BBB+ Stable Wr E. Hjalmarsson / L. LandemanSandnes Sparebank BBB+ Stable L. Holm / K. JensenSandvik Ab BBB Neg B. Børsting / M. Rosendal MARKETWEIGHTSas Ab B- Stable Wr Stable B. Børsting / M. RosendalSbab Bank Ab A Neg A2 Stable L. Holm / K. Jensen MARKETWEIGHTScania Ab BBB+ Neg M. Rosendal / B. Børsting UNDERWEIGHTSeadrill Ltd B+ Neg B- S. Stormyr / B.K. RøedSecuritas Ab BBB Stable Wr B. Børsting / M. Rosendal MARKETWEIGHTShip Finance International Ltd BB Stable BB- Wr B.K. Røed / J. MeyerSiem Offshore Inc B- Neg I. Båtvik / Ø. MossigeSkandinaviska Enskilda Banken Ab A+ Stable Aa3 Stable A+ Pos L. Holm / K. Jensen OVERWEIGHTSkanska Ab BBB+ Stable E. Hjalmarsson / L. LandemanSkf Ab BBB Neg Baa2 Stable M. Rosendal / E. Hjalmarsson UNDERWEIGHTSognekraft As BBB Stable BBB J. Magnussen / L. LandemanSolstad Offshore Asa BB- Stable B+ I. Båtvik / Ø. MossigeSpar Nord Bank A/S BBB+ Stable L. Holm / K. JensenSparebank 1 Boligkreditt As A- Stable L. Holm / K. JensenSparebank 1 Nord Norge A1 Stable A Stable L. Holm / K. Jensen UNDERWEIGHTSparebank 1 Smn A1 Stable A- Stable L. Holm / K. Jensen MARKETWEIGHTSparebank 1 Sr-Bank Asa A1 Stable A- Stable L. Holm / K. Jensen UNDERWEIGHTSparekassen Kronjylland BBB Stable L. Holm / K. JensenSponda Oyj BBB- Stable E. Hjalmarsson / L. LandemanSsab Ab B+ M. Rosendal / L. Landeman UNDERWEIGHTSt1 Nordic Oy BB Stable J. Magnussen / L. LandemanStatkraft Sf A- Neg Aaa Stable J. Magnussen / L. Landeman MARKETWEIGHT


33 33




Analyst(s)

Company Rating Outlook Sr. Unsec Rating Outlook Rating Outlook Rating OutlookStatnett Sf A+ Stable Wr Stable J. Magnussen / L. Landeman MARKETWEIGHTStatoil Asa A+ Stable Aa2 J. Magnussen / L. Landeman UNDERWEIGHTStena Ab BB Stable B2 N. Ripa / B. Børsting UNDERWEIGHTStockmann Oyj Abp B+ Stable N. Ripa / G. BerginStolt-Nielsen Ltd BB+ Stable BB B.K. Røed / J. MeyerStora Enso Oyj BB Stable Ba2 Stable WD M. Rosendal / L. Landeman MARKETWEIGHTStorebrand Bank Asa BBB+ Stable BBB+ Neg Nr Stable L. Holm / K. JensenStorebrand Livsforsikring As BBB+ Stable Baa1 Stable L. Holm / K. JensenSunnfjord Energi As BBB- Stable BBB- J. Magnussen / L. LandemanSuomen Hypoteekkiyhdistys BBB Neg L. Holm / K. JensenSvensk Fastighetsfinansiering Ab BBB Stable Louis LandemanSvenska Cellulosa Ab Sca A- Stable Baa1 Stable M. Rosendal / B. Børsting MARKETWEIGHTSvenska Handelsbanken Ab AA- Neg Aa2 Stable AA- Stable L. Holm / K. Jensen OVERWEIGHTSwedavia Ab A- Stable G. Bergin / L. LandemanSwedbank Ab AA- Neg Aa3 Stable A+ Pos L. Holm / K. Jensen MARKETWEIGHTSwedish Match Ab BBB Stable Baa2 Stable B. Børsting / M. Rosendal MARKETWEIGHTSydbank A/S Baa1 Stable L. Holm / K. Jensen MARKETWEIGHTTallink Grupp As BB Stable BB- N. Ripa / J. MagnussenTdc A/S BBB- Stable Baa3 Stable BBB- Stable M. Rosendal / J. Magnussen MARKETWEIGHTTechnopolis Oyj BB+ Stable BB L. Landeman / E. HjalmarssonTeekay Lng Partners Lp BB Stable BB- Ø. MossigeTeekay Offshore Partners Lp BB- Stable B+ Ø. MossigeTele2 Ab BBB Stable M. Rosendal / J. MagnussenTelefonaktiebolaget Lm Ericsson BBB+ Stable Baa1 Stable BBB+ Stable M. Rosendal / J. Magnussen MARKETWEIGHTTelenor Asa A Stable A3 Stable M. Rosendal / J. Magnussen MARKETWEIGHTTeliasonera Ab A- Stable A3 A- Stable M. Rosendal / J. Magnussen UNDERWEIGHTTeollisuuden Voima Oyj BBB- Neg Wr BBB Stable J. Magnussen / L. Landeman OVERWEIGHTTine Sa BBB+ Stable O. Heldal / L. LandemanTopdanmark A/S BBB+ Stable L. Holm / K. JensenTryg A/S L. Holm / K. JensenUpm-Kymmene Oyj BB+ Stable Ba1 Pos WD M. Rosendal / L. Landeman MARKETWEIGHTVasakronan Ab A- Stable E. Hjalmarsson / L. Landeman


34 34




Analyst(s)

Company Rating Outlook Sr. Unsec Rating Outlook Rating Outlook Rating OutlookVattenfall Ab BBB A3 BBB+ Stable J. Magnussen / L. Landeman MARKETWEIGHTVestas Wind Systems A/S BBB N. Ripa / J. Magnussen OVERWEIGHTVictoria Park Ab BB- Pos B+ L. Landeman / E. HjalmarssonVolvo Ab BBB Stable Baa2 Stable BBB Stable M. Rosendal / B. Børsting MARKETWEIGHTWihlborgs Fastigheter Ab BB+ Stable BB L. Landeman / E. HjalmarssonWilh Wilhelmsen Asa BB+ Stable B.K. Røed / J. MeyerYit Oyj B Stable E. Hjalmarsson / L. Landeman


35 35

Fixed Income Credit Research team Thomas Hovard, Chief Analyst Head of Credit Research +45 45 12 85 05 [email protected]

Louis Landeman, Senior Analyst TMT, Industrials +46 8 568 80524 [email protected]

Mads Rosendal, Analyst Industrials, Pulp & Paper +45 45 14 88 79 [email protected]

Jakob Magnussen, Senior Analyst Utilities, Energy +45 45 12 85 03 [email protected]

Knut-Ivar Bakken, Senior Analyst Fish Farming +47 85 40 70 74 [email protected]

Katrine Jensen, Analyst Financials +45 45 12 80 56 [email protected]

Ola Heldal, Senior Analyst TMT +47 85 40 84 33 [email protected]

Sondre Dale Stormyr, Senior Analyst Offshore Rigs +47 85 40 70 70 [email protected]

Henrik René Andresen, Senior Analyst Credit Portfolios +45 45 13 33 27 [email protected]

Øyvind Mossige, Senior Analyst Oil Services +47 85 40 54 91 [email protected]

Emil Hjalmarsson, Analyst Real Estate, Construction +46 8 568 80634 [email protected]

Haseeb Syed

High Yield, Norway +47 85 40 54 19 [email protected]

Brian Børsting, Senior Analyst Industrials +45 45 12 85 19 [email protected]

Lars Holm, Senior Analyst Financials +45 45 12 80 41 [email protected]

Gabriel Bergin, Analyst Strategy, Industrials +46 8 568 80602 [email protected]

Niklas Ripa, Senior Analyst High Yield, Industrials +45 45 12 80 47 [email protected]

Bjørn Kristian Røed, Senior Analyst Shipping +47 85 40 70 72 [email protected]

Iver Christian Båtvik, Analyst Shipping +47 95 97 74 45 [email protected]

mailto:[email protected]





















36 36

Disclosures This research report has been prepared by Danske Bank Markets, a division of Danske Bank A/S ('Danske Bank'). The authors of this research report are Louis Landeman, Senior Analyst, and Katrine Jensen, Analyst.

Analyst certification

Each research analyst responsible for the content of this research report certifies that the views expressed in the research report accurately reflect the research analyst's personal view about the financial instruments and issuers covered by the research report. Each responsible research analyst further certifies that no part of the compensation of the research analyst was, is or will be, directly or indirectly, related to the specific recommendations expressed in the research report.

Regulation

Danske Bank is authorised and subject to regulation by the Danish Financial Supervisory Authority and is subject to the rules and regulation of the relevant regulators in all other jurisdictions where it conducts business. Danske Bank is subject to limited regulation by the Financial Conduct Authority and the Prudential Regulation Authority (UK). Details on the extent of the regulation by the Financial Conduct Authority and the Prudential Regulation Authority are available from Danske Bank on request.

The research reports of Danske Bank are prepared in accordance with the Danish Society of Financial Analysts' rules of ethics and the recommendations of the Danish Securities Dealers Association.

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Danske Bank has established procedures to prevent conflicts of interest and to ensure the provision of high-quality research based on research objectivity and independence. These procedures are documented in Danske Bank's research policies. Employees within Danske Bank's Research Departments have been instructed that any request that might impair the objectivity and independence of research shall be referred to Research Management and the Compliance Department. Danske Bank's Research Departments are organised independently from and do not report to other business areas within Danske Bank.

Research analysts are remunerated in part based on the overall profitability of Danske Bank, which includes investment banking revenues, but do not receive bonuses or other remuneration linked to specific corporate finance or debt capital transactions.

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General disclaimer This research has been prepared by Danske Bank Markets (a division of Danske Bank A/S). It is provided for informational purposes only. It does not constitute or form part of, and shall under no circumstances be considered as, an offer to sell or a solicitation of an offer to purchase or sell any relevant financial instruments (i.e. financial instruments mentioned herein or other financial instruments of any issuer mentioned herein and/or options, warrants, rights or other interests with respect to any such financial instruments) ('Relevant Financial Instruments').

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