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MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
CREDIT SUPPLY
Atradius is coming to market with a subordinated Tier 2 instrument: IPT is MS+275bp, we see fair value around MS+230bp.
- In a slightly complex transaction, this bond is being issued from the Spanish subsid of a Dutch holding company and, concurrently, the outstanding EUR250m sub debt of Atradius Finance BV (ATRADI 5.25% 09.23/2044) is being tendered for.
- This is tough to value but financials sub debt at this maturity is rare – the EUR curve for similarly-rated bonds (A2-rated) is attached and shows an upper group of more P&C insurers and a lower group of reinsurers and composites (largely, Axa).
- We value using the upper group as our start point and the slope of the overall A2 curve which would get us to a fair value of around 220bp. We adjust to 230bp to account for the rarity factor plus the little-known nature of the issuer (as a credit insurer).
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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