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CREDIT SUPPLY: PEOPW SNP Issue; We See Fair Value Around MS+190bp Area.

CREDIT SUPPLY
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Bank Pekao (PEOPW: BBB) is issuing senior non-preferred today; we see fair value around MS+190bp area.

  • PEOPW is issuing EUR benchmark 6NC5 fixed senior non-preferred with IPT at MS+220bp area. Expected rating is BBB.
  • Well populated SNP curves are pretty rare but, using two other banks with similar ratings (Caixa same rating, Unicredit a notch lower), we can see extension from PEOPW 5.5% ’27 at 2.2yrs out to this 5yr tends to be around 30bp in total. However, That PEOPW is trading at MS+163bp so this points us towards MS+190bp area.
  • We also note the tragic floods in CEE and that PZU, the Polish insurer, saw its equity down over 15% at one stage yesterday.
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Bank Pekao (PEOPW: BBB) is issuing senior non-preferred today; we see fair value around MS+190bp area.

  • PEOPW is issuing EUR benchmark 6NC5 fixed senior non-preferred with IPT at MS+220bp area. Expected rating is BBB.
  • Well populated SNP curves are pretty rare but, using two other banks with similar ratings (Caixa same rating, Unicredit a notch lower), we can see extension from PEOPW 5.5% ’27 at 2.2yrs out to this 5yr tends to be around 30bp in total. However, That PEOPW is trading at MS+163bp so this points us towards MS+190bp area.
  • We also note the tragic floods in CEE and that PZU, the Polish insurer, saw its equity down over 15% at one stage yesterday.