June 04, 2024 08:23 GMT
Alpha Services T2 Issue: We See FV At 5.90% Area
CREDIT SUPPLY
Alpha Services (B1 pos/CCC pos) is issuing Tier 2 sub debt today – we see fair value at 5.90% area.
- Alpha Services (owner of Alpha Bank) is issuing EUR500m (WNG) 10.25NC5.25 of Tier 2 sub debt with IPT in the 6.375-6.500% area. Expected rating is B1.
- Using a swap rate of 2.88%, this implies MS+350-362bp area. Eurobank and MPS are both similarly-rated but there are generally few good T2 curves at these ratings. Alpha’s single T2 trades tight to MPS’s curve (and wide of Eurobank) so we’d see fair value here something slightly above Monte’s 10.5% at similar workout to account for the relatively less well known nature of Alpha
- We see fair value around MS+300bp, so 5.90% area.
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