Weekly Credit Update – 28 November, 2014

Transcription

Weekly Credit Update – 28 November, 2014
Investment Research — General Market Conditions
28 November 2014
Weekly Credit Update
Headlines

Debt issued by European corporates heads for post-crisis high

‘Smoke signals’ from the ECB to extend asset purchase programme

Lower-for-longer scenario for both interest rates and credit spreads on the cards

S&P´s proposes new rating criteria regarding senior bank ratings

OPEC decision not expected to negatively affect the broader credit market (for now)

ISS successfully launched a 5Y and 10Y dual tranche EUR Benchmark
Contents
Market commentary
1
Selected charts
4
Recently published research
6
Official and shadow ratings
7
Market commentary
Over the past week, the Itraxx main index (investment grade) more or less stayed flat at
59bp while the Itraxx crossover index (high yield) tightened by 14bp w/w.
This week started with several articles illustrating the temperature of the European credit
markets. First, Fitch reported that the amount of new debt – bonds and loans – issued by
European companies is heading for a post-crisis high in 2014. Lower funding costs are
driving continued refinancing and M&A activity is heating up. The value of M&A
activity was up 25% to USD1tn in the first three quarters of 2014, boosting demand for
corporate funding. Syndicated loans in Europe are up 23% YTD and corporate bond
issuance is down 5% y/y. A strong Q4 bond pipeline could still put 2014 close to the
EUR500bn annual record of 2009. According to Fitch, corporate bond funding now
accounts for some 83% of the total new debt of European corporates in developed
markets. Interestingly, corporates in the eurozone periphery have also continued to issue
bonds at a brisk pace, maintaining the bond ratio at some 40% of total funding on par
with corporate bond ratios seen in Germany, France and the UK. Given the continued
deleveraging of banks in Italy and Spain, importantly the bond market seems to be
closing the corporations funding gap.
Another interesting point of the week was the ‘smoke signals’ that the ECB sent to the
market. They indicated a will to possibly broaden the scope of the current asset purchase
program (is QE4 underway?). If executed, the ECB stands with the grand challenge of
selecting which assets to buy. The ECB is already loading up on European covered bonds
and recently started buying asset-backed securities. Covered bond issuance in the EU is
negative by EUR22bn so far in 2014, which is why further purchase possibilities within
this asset class by the ECB will be significantly more challenging going forward.
According to the smoke signals, the ECB is considering including the purchase of other
assets such as government bonds (highly controversial and legally complex) and/or the
direct purchase of corporate bonds (which carry more credit risk and are disliked by
Bundesbank for valuation reasons). In the week, it seemed as though the market started to
speculate that corporate bonds would be included under a possible new asset purchase
programme.
Important disclosures and certifications are contained from page 10 of this report.
iTraxx Europe (investment grade)
Source: Bloomberg, Danske Bank Markets
iTraxx Crossover (high yield)
Source: Bloomberg, Danske Bank Markets
Senior Analyst
Niklas Ripa
+45 4512 8047
[email protected]
www.danskeresearch.com
Weekly Credit Update
We saw tightening in HY indices and investors trading out of tightly trading high quality
IG issuers (for example, some of the Scandi names) and into higher yielding issuers from
the periphery countries. Time will show whether the ECB will release the fireworks in the
corporate bond universe and the eventual effects of such actions. For now, it seems that
more compression of spreads has been the recent outcome. Whether the ECB finally
decides to enact a new QE programme or not will depend on whether positive inflation
and growth expectations can be ignited shortly. In our view, the continued ECB easing
mode should support a lower-for-longer scenario for both European interest rates and
credit spreads going into the New Year. On a final note on this theme, German 10-year
interest rates hit a record bottom this week with a yield of 0.70%.
Following the recent weeks’ regulatory proposals to include significant additional lossabsorbing capital to avoid future tax payer ‘bailouts’, S&P´s published a request for
comment with regard to new bank rating criteria. S&P´s criteria would be applicable to
banking groups that are headed either by an operating company or by a non-operating
holding company (read: all regulatory, important banks). Specifically, S&P´s proposes to
notch up the rating on banks with additional bail-in capital in case of a restructuring
event. S&P´s specifically proposes to raise the issuer credit rating to one-notch above the
stand-alone credit profile if such additional loss absorption cushion consistently remains
in the range of 5-6% of S&P´s calculated RWA and a two-notch uplift if such cushion is
in the range of 8-10%. S&P´s expects the new criteria to lead to a limited amount of
rating changes directly.
However, over time, any additional loss absorption capacity could replace any rating
uplift granted to the banks ratings due to the inclusion of possible extraordinary
government support. In turn, this may imply the risk of a downgrade of senior debt issued
out of holding company structures, as no extraordinary government support would be
likely to be included in such ratings over time. So far, the European senior financials have
been almost unscathed by any of the new regulatory loss-absorption proposals presented
over the past weeks, while the Tier-2 sub debt market has suffered and has stayed rather
illiquid. However, the discount between senior operating bank bonds and holdco bank
bonds seems to have widened by up to some 40bp over the past month, which is why the
market now realises that there will be ‘regulatory’ subordination risk in the bank holdco
senior bonds as no extraordinary government support may be forthcoming in case of a
‘non-viability event’ in the future.
This week we saw strong US GDP figures and an interesting outcome of the gathering of
the 12 nations that are members of the OPEC group. The OPEC group decided to
maintain its collective production ceiling of 30 million barrels a day despite an oil price
drop so far this year of some 35%. We doubt that the decision taken by the OPEC nations
(for now) will significantly affect the credit spreads of the broader euro corporate bond
market. However, it seems obvious that if the oil price declines are persistent for years to
come, many oil/drilling companies and related subsector companies (for example, oil
field services) and banks exposed to such credits may be severely affected.
The primary market was fairly active with new issues across the corporate space, cf. table
enclosed below. Following a 10-year issuance break, we saw the Danish global facility
service company ISS (BBB-/Baa3) return to the EUR corporate bond market and
successfully issue a dual-tranche EUR benchmark structure. The purpose of the
transaction was to refinance the existing banking debt and diversify the funding structure.
The transaction represents both the largest Nordic BBB- rated corporate issue and the
lowest achieved benchmark coupons on a five- and 10-year dual tranche transaction by
any Nordic corporate ever.
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Weekly Credit Update
In addition, we can highlight that the Danish capital goods company Danfoss (BBB/NR)
is currently on a roadshow meeting European corporate bond investors. Danfoss is a
significant global capital goods company and a leader within technical and mechanical
components towards various industries.
Selected issues
Name
ISS Global
ISS Global
Victoria Park
Telefonica Europe
Repsol Int.
Glaxosmithkline
Glaxosmithkline
Scania
Scania
Rating
BBB- /Baa3
BBB- /Baa3
NR
BB+
BBB
A+/A2
A+/A2
AA-
Coupon
1.125%
2.125%
FRN
4.200%
2.250%
1,375%
0.625%
0.875%
FRN
Cur. Tenor
Size
EUR
5Y
700
EUR
10Y
500
SEK
3Y 400m
EUR Perp 850m
EUR
12Y
500
EUR
5Y 1000
EUR
10Y 1500
SEK
4Y 650m
SEK
4Y 1350
Spread*
MS + 75
MS + 118
Sti + 500
MS +380
MS +113
MS +33
MS +55
Sti +40
Source: Bloomberg, Danske Bank Markets. Size in million, ratings are issue ratings from S&P/Moody’s/Fitch
Trade recommendations
See the table below for our current trading ideas. We acknowledge that the credit market
in general and the Nordic in particular is not as liquid as other markets, which may affect
the possibility to, for example, short a specific bond. Thus, please see our strategies below
as ideas and input into your own investment process. New strategies for this week are
detailed on page five of this report. Last week, we added the Nynas and Volvo trade
ideas, cf. table enclosed below.
Past strategies
Type
Outright
Trade
VLVY' 17 or VLVY'19
Idea
Outright
NYNAAB '18
Outright
COMHSS '19
Curve spread
Switch from SKFBSS '19 to
SKFBSS '18 or '20
Outright
SAABAB '19
COMHSS '19 looks cheap compared to other rated and
unrated issues in SEK. Trades like a B+, but is officially
rated BBSKF’s 2020s and 2018s offer attractive value relative to
the rating (‘BBB+’ NO and ‘Baa1’ S) Downgrade seems
priced in already
Trading wider than the ‘BBB+’ shadow rating would imply
Curve spread
Swith from STENA '19 to
STENA '20
Stena 2020 cheap compared with overall Stena credit
curve and the Stena 2019 bond.
Sector spread
Switch from VLVY '19 to
METSO '19
Outright
EWOSAS '20
Metso trading wider than ‘BBB’ rating suggests. Metso
19s offer substantial pick-up to Volvo’s 19s (neg
outlook).
Mispriced due to lack of understanding of business
model
We see the VLVY cash curve at attractively valued and
an (uncertain) downgrade is more than priced in to
spreads
NYNAAB '18's, which we see as 'B+' indicatively trade
way too cheap relative to the industrial 'B+' curve
Opened
27 nov 2014
Start spread
Opened
73
25 nov 2014
Start spread
Opened
668
19 nov 2014
Start spread
Opened
450
18 nov 2014
Start spread
Opened
2
13 nov 2014
Start spread
Opened
115
24 okt 2014
Start spread
Opened
126
20 okt 2014
Start spread
Opened
-5
20 okt 2014
Start spread
Source: Danske Bank Markets
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647
Weekly Credit Update
Selected charts
iTraxx (Europe) vs CDX (US)
Investment grade corporate yields
Source: Bloomberg, Danske Bank Markets
Source: Bloomberg, Danske Bank Markets
Nordic corporates vs iTraxx
Nordic banks 5Y CDS spreads
Source: Bloomberg, Danske Bank Markets
Source: Bloomberg, Danske Bank Markets
Corporate BBB bond yield vs EuroSTOXX dividend yield
3M Libor OIS spreads
Source: Bloomberg, Danske Bank Markets
Source: Bloomberg, Danske Bank Markets
Financials spread vs non-financials (Industrials), A-rated
Source: Bloomberg, Danske Bank Markets
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Weekly Credit Update
Europe fund flows
Sweden fund flows
Norway fund flows
Source: Macrobond
Source: Macrobond
Source: Macrobond
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Weekly Credit Update
Recently published research
Akelius Q4 14 - Credit Update, 27 November 2014
Akelius Residential Property presented a good set of results, with continued growth in
rental income and earnings. We maintain our credit view of Akelius and its bonds at
‘BB+/BB’, respectively, with a positive outlook.
Volvo (EUR) - Relative value idea, 27 November 2014
The Volvo curve trades wide, in our view. A downgrade to 'BBB-' seems to be fully
priced in, limiting the downside from a potential downgrade. We recommend investors
buy the EUR-denominated VLVY 17 or 19 bonds. Alternatively, investors can sell 5Y
protection on VLVY for an even greater pick-up relative to the cash curve.
Nynas 2018s (SEK) – Relative value idea, 25 November 2014
Nynas has just released strong Q3 14 numbers, taking adjusted credit metrics to strong
levels for the current 'B+' indicative rating. The Nynas FRN 2018s in SEK trade very
attractively compared with other 'B+' rated industrials. Cyclicality, illiquidity and unrated
premiums in bonds cannot justify the current spread level of DM+666bp.
DFDS Q3 14 - Credit Update, 21 November 2014
DFDS reported a solid Q3 14 result. We continue to view DFDS’s credit profile as
commensurate with a 'BBB-' indicative rating despite our expectation of increased
shareholder remuneration going forward. The FRN bonds issued in NOK are currently
priced fairly at 25-30bp above a 'BBB-' credit curve. Given the 'missing official rating
discount' in the pricing of the DKK FRN 2019 bond, we regard this bond as tightly
priced. We recommend investors able to hold NOK to consider switching from the DKK
FRN 2019 bond and into the NOK FRN 2018 bond.
Com Hem (SEK) - Relative value idea, 19 November 2014
Compared with other rated and unrated issues in the SEK universe, COMHSS looks
cheap and trades in line with or somewhat wider than names in the B+ area.
SKF switch idea, 18 November 2014
The SKF 2019s trade too tight, in our view. We see more value in the SKF 2020s and
2018s. SKF is rated 'BBB+' and 'Baa1' by Moody's. S&P's recently put SKF on negative
outlook citing an unexpectedly slow recovery in credit metrics following the acquisition
of Kaydon. SKF 2020 and SKF 2018 trade at fair value for a 'BBB' indicating limited
downside should SKF be downgraded one notch and potential upside if SKF avoids the
downgrade. We recommend investors switch out of the SKF2019s and into either
SKF2018s or SKF2020s depending on risk tolerance.
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Weekly Credit Update
Ratings from Standard & Poor’s, Moody’s and Fitch and Danske Bank markets shadow ratings
Danske Bank
Company
Rating Outlook Sr. Unsec
Ahlstrom Oyj
B+
Stable
Akelius Residential Ab
BB+
Pos
BB
Ambu A/S
BBBStable
Ap Moeller - Maersk A/S
Arla Foods Amba
BBB+
Stable
Atlas Copco Ab
Avinor As
Bank 1 Oslo Akershus As
BBB+
Stable
Bank Norwegian As
BBB
Stable
Beerenberg Holdco Ii As
B+
Stable
Bw Offshore
BB+
Stable
Cargotec Oyj
BBBStable
Carlsberg Breweries A/S
Cermaq Asa
BB
Stable
Citycon Oyj
Color Group As
BBStable
B+
Com Hem Holding Ab
Danske Bank A/S
Dfds A/S
BB+
Stable
Dlg Finance As
BBStable
Dna Ltd
BBBStable
Dnb Bank Asa
Dong Energy A/S
Dsv A/S
BBB
Stable
Eg Holding
B
Stable
Eika Boligkreditt As
AStable
Eika Gruppen As
BBB
Stable
Electrolux Ab
Elisa Oyj
Entra Eiendom As
AStable
Farstad Shipping Asa
BB
Neg
BBFingrid Oyj
Finnair Oyj
BB
Stable
Fortum Oyj
Fortum Varme Holding Samagt Med Stockholms Stad Ab
Fred Olsen Energy Asa
BB+
Neg
G4S Plc
Getinge Ab
BB+
Neg
Heimstaden Ab
BB
Stable
BBHemso Fastighets Ab
BBB+
Stable
BBB
Hoist Kredit Ab
BBStable
B+
Husqvarna Ab
BBBPos
Ikano Bank Ab
BBB
Stable
Investor Ab
Iss A/S
J Lauritzen A/S
B
Stable
BJernhusen Ab
AStable
Jyske Bank A/S
Kesko Oyj
BBB
Stable
Klaveness Ship Holding As
BBStable
B+
Meda Ab
BBStable
Metsa Board Oyj
Metso Oyj
Ncc Ab
BBBStable
Neste Oil Oyj
BBBStable
Nokia Oyj
Nokian Renkaat Oyj
BBB+
Stable
Nordea Bank Ab
North Atlantic Drilling Ltd
BB
Stable
BBNorwegian Air Shuttle Asa
BBStable
B+
Norwegian Property Asa
BBBStable
Nykredit Bank A/S
Nynas Group
B+
Stable
B+
Odfjell Se
B+
Stable
B
Olav Thon Eiendomsselskap Asa
BBB+
Stable
Olympic Shipping As
B+
Stable
B
Orkla Asa
BBB+
Pos
Outokumpu Oyj
BPos
Pohjola Bank Oyj
Posten Norge As
AStable
Postnord Ab
BBB+
Stable
S&P
Rating Outlook
Moody's
Rating Outlook
BBB+
Stable
Baa1
Stable
A
AA-
Stable
Stable
A2
A1
Stable
Stable
Baa2
Stable
BBB
Stable
Baa2
Stable
BBA
Stable
Neg
Baa1
Pos
Fitch
Rating Outlook
BBB
Stable
A
Stable
A+
BBB+
Stable
Stable
A1
Baa1
Neg
Stable
BBB
BBB
Stable
Pos
Wr
Baa2
Stable
A+
Stable
A1
Stable
A+
Stable
ABBB+
Neg
Stable
A2
Neg
A-
Neg
BBB-
Stable
AABBB-
Stable
Stable
A1
Stable
A-
Stable
Baa1
Neg
B+
BBB
Pos
Stable
B2
Baa2
Pos
Stable
BB
Pos
Ba2
Pos
BB
Stable
AA-
Neg
Aa3
Neg
AA-
Stable
A+
Neg
Baa2U
Stable
A
Stable
AA-
Neg
Aa3
Neg
A+
Stable
BBB+
Stable
WD
Analyst(s)
Mads Rosendal
Louis Landeman
Jakob Magnussen
Brian Børsting
Mads Rosendal
Mads Rosendal
Ola Heldal
T. Hovard / L. Holm
T. Hovard / L. Holm
Øyvind Mossige
Øyvind Mossige
Mads Rosendal
Brian Børsting
Knut-Ivar Bakken
Louis Landeman
Niklas Ripa
Ola Heldal
Brian Børsting
Mads Rosendal
Ola Heldal
T. Hovard / L. Holm
Jakob Magnussen
Brian Børsting
Jakob Magnussen
T. Hovard / L. Holm
T. Hovard / L. Holm
Brian Børsting
Ola Heldal
Ola Heldal
Bjørn Kristian Røed
Jakob Magnussen
Brian Børsting
Jakob Magnussen
Jakob Magnussen
Sondre Stormyr
Brian Børsting
Louis Landeman
Louis Landeman
Louis Landeman
Gabriel Bergin
Louis Landeman
T. Hovard / L. Holm
Brian Børsting
Brian Børsting
Bjørn Kristian Røed
Gabriel Bergin
Thomas M. Hovard
Mads Rosendal
Bjørn Kristian Røed
Louis Landeman
Mads Rosendal
Mads Rosendal
Louis Landeman
Jakob Magnussen
Ola Heldal
Jakob Magnussen
T. Hovard / L. Holm
Sondre Stormyr
Brian Børsting
Ola Heldal
T. Hovard / L. Holm
Jakob Magnussen
Bjørn Kristian Røed
Ola Heldal
Bjørn Kristian Røed
Ola Heldal
Mads Rosendal
T. Hovard / L. Holm
Ola Heldal
Gabriel Bergin
Source: Standard & Poor’s, Moody’s, Fitch, Danske Bank Markets
7|
28 November 2014
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Recomm.
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SELL
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SELL
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SELL
Weekly Credit Update
Ratings from Standard & Poor’s, Moody’s and Fitch and Danske Bank markets shadow ratings
Company
Prosafe Se
Ramirent Oyj
Saab Ab
Sampo Oyj
Sandnes Sparebank
Sandvik Ab
Sas Ab
Sbab Bank Ab
Scania Ab
Schibsted Asa
Seadrill Ltd
Securitas Ab
Skandinaviska Enskilda Banken Ab
Skanska Ab
Skf Ab
Solstad Offshore Asa
Spar Nord Bank A/S
Sparebank 1 Boligkreditt As
Sparebank 1 Nord Norge
Sparebank 1 Smn
Sparebank 1 Sr-Bank Asa
Sponda Oyj
St1 Nordic Oy
Statkraft Sf
Statnett Sf
Statoil Asa
Steen & Strom As
Stena Ab
Stockmann Oyj Abp
Stolt-Nielsen Ltd
Stora Enso Oyj
Storebrand Bank Asa
Suomen Hypoteekkiyhdistys
Swedavia Ab
Swedbank Ab
Swedish Match Ab
Svensk Fastighetsfinansiering Ab
Svenska Cellulosa Ab Sca
Svenska Handelsbanken Ab
Sydbank A/S
Tallink Group As
Tdc A/S
Teekay Offshore Partners Lp
Tele2 Ab
Telefonaktiebolaget Lm Ericsson
Telenor Asa
Teliasonera Ab
Teollisuuden Voima Oyj
Thon Holding As
Tine Sa
Upm-Kymmene Oyj
Vasakronan Ab
Vattenfall Ab
Vestas Wind Systems A/S
Wilh Wilhelmsen Asa
Volvo Ab
Yit Oyj
Rating
BB
BB+
BBB+
BBB+
BBB
BB+
Danske Bank
Outlook Sr. Unsec
Stable
Stable
Stable
Stable
Stable
Stable
BBBBB+
A-
Stable
Stable
Stable
Wr
Baa2
Stable
Fitch
Rating Outlook
BBB
BA
A-
Neg
Stable
Neg
Stable
Wr
A2
Pos
Neg
BBB
A+
Stable
Neg
Wr
A1
Neg
BBB+
Neg
Baa1
Stable
A2
A2
A2
Neg
Neg
Neg
BB
A+
Pos
B+
A
AA-
Stable
Stable
Stable
Stable
Stable
BBB+
Stable
B+
BB+
Stable
Stable
BBB+
AA-
Stable
Stable
Stable
BBB
Moody's
Rating Outlook
Stable
BBB+
BBBBB
S&P
Rating Outlook
AA+
AA-
Stable
Stable
Stable
Aaa
Wr
Aa2
Stable
Stable
Stable
BB
Stable
B2
Stable
BB
BBB+
Stable
Neg
Ba2
Baa1
Stable
Neg
WD
A+
BBB
Neg
Stable
A1
Baa2
Neg
Stable
A+
Pos
AAA-
Stable
Neg
Baa1
Aa3
Baa1
Stable
Neg
Neg
AA-
Stable
BBB
Neg
Baa3
Stable
BBB
Stable
BBB+
A
ABBB
Stable
Stable
Stable
Neg
Baa1
A3
A3
Wr
Stable
Stable
Neg
BBB+
Neg
ABBB
Stable
Stable
BB+
Stable
Ba1
Stable
WD
A-
Stable
A3
Stable
A-
Neg
BBB
Neg
Baa2
Neg
BBB
Stable
BB
Stable
BB
Stable
BB-
BBBBB
Stable
Stable
B+
BBB+
BBB+
Stable
Stable
A-
Stable
BBBBBB-
Pos
Stable
B
Neg
Analyst(s)
Øyvind Mossige
Brian Børsting
Louis Landeman
T. Hovard / L. Holm
T. Hovard / L. Holm
Mads Rosendal
Brian Børsting
T. Hovard / L. Holm
Mads Rosendal
Ola Heldal
Sondre Stormyr
Brian Børsting
T. Hovard / L. Holm
Louis Landeman
Mads Rosendal
Øyvind Mossige
T. Hovard / L. Holm
Lars Holm
T. Hovard / L. Holm
T. Hovard / L. Holm
T. Hovard / L. Holm
Louis Landeman
Jakob Magnussen
Jakob Magnussen
Jakob Magnussen
Jakob Magnussen
Ola Heldal
Brian Børsting
Mads Rosendal
Bjørn Kristian Røed
Mads Rosendal
T. Hovard / L. Holm
T. Hovard / L. Holm
Gabriel Bergin
T. Hovard / L. Holm
Brian Børsting
Louis Landeman
Mads Rosendal
T. Hovard / L. Holm
T. Hovard / L. Holm
Jakob Magnussen
Ola Heldal
Bjørn Kristian Røed
Ola Heldal
Ola Heldal
Ola Heldal
Ola Heldal
Jakob Magnussen
Ola Heldal
Ola Heldal
Mads Rosendal
Louis Landeman
Jakob Magnussen
Niklas Ripa
Bjørn Kristian Røed
Mads Rosendal
Louis Landeman
Source: Standard & Poor’s, Moody’s, Fitch, Danske Bank Markets
8|
28 November 2014
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Recomm.
HOLD
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SELL
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HOLD
SELL
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Weekly Credit Update
Fixed Income Credit Research
Thomas Hovard
Head of Credit Research
(+45) 45 12 85 05
[email protected]
Louis Landeman
TMT, Industrials
(+46) 8 568 80524
[email protected]
Henrik René Andresen
Credit Portfolios
(+45) 45 13 33 27
[email protected]
Mads Rosendal
Industrials, Pulp & Paper
(+45) 45 14 88 79
[email protected]
Jakob Magnussen
Utilities, Energy
(+45) 45 12 85 03
[email protected]
Brian Børsting
Industrials
(+45) 45 12 85 19
[email protected]
Gabriel Bergin
Strategy, Industrials
(+46) 8 568 80602
[email protected]
Niklas Ripa
High Yield, Industrials
(+45) 45 12 80 47
[email protected]
Bjørn Kristian Røed
Shipping
(+47) 85 40 70 72
[email protected]
Ola Heldal
TMT
(+47) 85408433
[email protected]
Øyvind Mossige
Oil services
(+47) 85 40 54 91
[email protected]
Sondre Dale Stormyr
Offshore rigs
(+47) 85 40 70 70
[email protected]
Lars Holm
Financials
(+45) 45 12 80 41
[email protected]
Knut-Ivar Bakken
Fish farming
(+47) 85 40 70 74
[email protected]
Find the latest Credit Research
Danske Bank Markets:
http://www.danskebank.com/danskemarketsresearch
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Disclosures
This research report has been prepared by Danske Bank Markets, a division of Danske Bank A/S (‘Danske
Bank’). The author of the research report is Niklas Ripa, 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.
Conflicts of interest
Danske Bank has established procedures to prevent conflicts of interest and to ensure the provision of highquality 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.
Danske Bank, its affiliates and subsidiaries are engaged in commercial banking, securities underwriting, dealing,
trading, brokerage, investment management, investment banking, custody and other financial services activities,
may be a lender to the companies mentioned in this publication and have whatever rights are available to a
creditor under applicable law and the applicable loan and credit agreements. At any time, Danske Bank, its
affiliates and subsidiaries may have credit or other information regarding the companies mentioned in this
publication that is not available to or may not be used by the personnel responsible for the preparation of this
report, which might affect the analysis and opinions expressed in this research report.
See http://www-2.danskebank.com/Link/researchdisclaimer for further disclosures and information.
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’).
The research report has been prepared independently and solely on the basis of publicly available information that
Danske Bank considers to be reliable. While reasonable care has been taken to ensure that its contents are not
untrue or misleading, no representation is made as to its accuracy or completeness and Danske Bank, its affiliates
and subsidiaries accept no liability whatsoever for any direct or consequential loss, including without limitation
any loss of profits, arising from reliance on this research report.
The opinions expressed herein are the opinions of the research analysts responsible for the research report and
reflect their judgement as of the date hereof. These opinions are subject to change and Danske Bank does not
undertake to notify any recipient of this research report of any such change nor of any other changes related to the
information provided in this research report.
This research report is not intended for retail customers in the United Kingdom or the United States.
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reproduced or distributed, in whole or in part, by any recipient for any purpose without Danske Bank’s prior
written consent.
Disclaimer related to distribution in the United States
This research report is distributed in the United States by Danske Markets Inc., a U.S. registered broker-dealer
and subsidiary of Danske Bank, pursuant to SEC Rule 15a-6 and related interpretations issued by the U.S.
Securities and Exchange Commission. The research report is intended for distribution in the United States solely
to ‘U.S. institutional investors’ as defined in SEC Rule 15a-6. Danske Markets Inc. accepts responsibility for this
research report in connection with distribution in the United States solely to ‘U.S. institutional investors’.
Danske Bank is not subject to U.S. rules with regard to the preparation of research reports and the independence
of research analysts. In addition, the research analysts of Danske Bank who have prepared this research report are
not registered or qualified as research analysts with the NYSE or FINRA but satisfy the applicable requirements
of a non-U.S. jurisdiction.
Any U.S. investor recipient of this research report who wishes to purchase or sell any Relevant Financial
Instrument may do so only by contacting Danske Markets Inc. directly and should be aware that investing in nonU.S. financial instruments may entail certain risks. Financial instruments of non-U.S. issuers may not be
registered with the U.S. Securities and Exchange Commission and may not be subject to the reporting and
auditing standards of the U.S. Securities and Exchange Commission.
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