April 29, 2024 08:31 GMT
Barclays 11NC10 EUR Issue: We See FV At MS+155-160bp
CREDIT SUPPLY
Barclays (Baa1/BBB+/A) two-tranche EUR issue today – we see FV on the benchmark 11NC10 at MS+155-160bp.
- Barclays is issuing a benchmark EUR senior unsecured 11NC10 today (alongside an EUR500m FRN). Results last week were ahead of expectations with solid credit metrics, mostly importantly showing some improvements in US card delinquencies.
- The senior unsecured curve for peers (see graphic) at that maturity is shallow but, using HSBC and Citi as vague comparables, the curve flattens reasonably as we tend towards 10Y. The direct intercept is at MS+148bp. Citi’s (A3/BBB+/A, so only marginally better-rated) curve sits around 40bp tight of BACR but the C 2 at a similar maturity is a low cash price issue so we’re happy to see fair value within 40bp of its MS+124bp point.
- We see fair value around MS+155-160bp area for a small NIP above the intercept point.
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