HALISTER1: U.S. Structured Finance Newsletter – September 7, 2016

U.S. Structured Finance Newsletter – September 7, 2016

Alert: HALISTER1
Source: DBR (Dominion Bond Rating Service)

People
Charles Weilamann (DBRS Inc)
Chris Donofrio (Dbrs Inc)
Chris O'Connell (DBRS Inc)
Christopher D'Onofrio (DBRS Inc)
Claire Mezzanotte (DBRS Inc)

Topics
Fixed Income Research
Industry & Sector Research
Credit Analysis Research
Credit Research
Investment Research

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UUID: 7947283

HALISTER1: FOMC’s Own Rates Outlook Lagging Behind Appropriate Path: UBS

FOMC’s Own Rates Outlook Lagging Behind Appropriate Path: UBS

(Bloomberg) -- “Under all but the most aggressive combination of assumptions, the FOMC’s own outlook for rates places them well behind the appropriate policy path” based on models, UBS economists Drew Matus, Dave Liang, Samuel Coffin write in note.
  • Analysis based on a number of Taylor Rule scenarios, as well as adjustments to rule to gauge potential impact of lower natural rate of interest, Fed’s balance sheet and possibility of higher inflation target
    • Suggests FOMC appears unconcerned about any stimulative impact of balance sheet, isn’t acting as if it will implement a higher inflation target in near term and isn’t set on “right” natural rate of interest remaining near zero
  • FOMC to remain cautious; UBS expects Fed to hold rates steady in Sept. with a hike in Dec. and 2 more in 2017; “some upside risk to this scenario”
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

People
Drew Matus (UBS Asset Management Japan Ltd)
Samuel Coffin (UBS Global Asset Management Japan Ltd)
David Liang (UBS Securities LLC)

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UUID: 7947283

HALISTER1: Italy May Face Cold Response for Any 50-Yr Bond Offer: Natixis

Italy May Face Cold Response for Any 50-Yr Bond Offer: Natixis

(Bloomberg) -- The Italian Treasury will probably receive poor demand for any offering of 50-year bonds because yields are already very low and political uncertainty in the country is set to rise heading into the constitutional referendum in autumn, Natixis strategist Cyril Regnat writes in e-mailed comments.
  • Long-end Italian yields are already very low and any demand from investors is going to decrease even if ECB announces a QE extension
  • A good way to ensure a successful syndication would be to offer a very generous discount, but even this is probably not really worth the try
  • Given the prospect of increased political uncertainty, it would probably be more convenient for Italy to keep issuing 30-year bonds ahead of the referendum
    • If Renzi gets a “Yes” vote, then the Treasury could try to launch a 50-year syndication
  • A “No” vote at the referendum is not priced into market and may lead to a BTP spread widening
    • There would be a bear-steepening of the curve starting on 5-year tenor with the worst on 30-year
    • First target at 160bps on a “No” vote and with Renzi leaving
    • In event of snap elections and M5S winning, a level between 2% and 2.5% for the 10Y BTP wouldn’t be surprising with Spain about 50bps below, he adds
  • NOTE: Italian Treasury sounding out investors on 50-year bond: WSJ
  • NOTE: Goldman Sachs says a sharp BTP widening unlikely even on Italy referendum no vote
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

Tickers
2103Z IM (Republic of Italy)

People
Cyril Regnat (Natixis SA)

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UUID: 7947283

HALISTER1: Banca Monte dei Paschi di Siena S.p.A. Covered Bonds (OBG - Mortgages - Programme 2) - DBRS Surveillance Report

Banca Monte dei Paschi di Siena S.p.A. Covered Bonds (OBG - Mortgages - Programme 2) - DBRS Surveillance Report

Alert: HALISTER1
Source: DBR (Dominion Bond Rating Service)

People
Chris McCafferty (Barclays PLC)
Claire Mezzanotte (DBRS Inc)
Lucia Liao (Maybank)
Pallop Angsupun (Nyc Economic Development Corp)

Topics
Asset Class Focused Research
Fixed Income Research
Reports
Credit Analysis Research
Credit Research

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UUID: 7947283

HALISTER1: Banca Monte dei Paschi di Siena S.p.A. Covered Bonds (OBG - Mortgages - Programme 1) - DBRS Surveillance Report

Banca Monte dei Paschi di Siena S.p.A. Covered Bonds (OBG - Mortgages - Programme 1) - DBRS Surveillance Report

Alert: HALISTER1
Source: DBR (Dominion Bond Rating Service)

People
Chris McCafferty (Barclays PLC)
Claire Mezzanotte (DBRS Inc)
Hiroshi Saito (Sbi Liquidity Market Co Ltd)
Lucia Liao (Maybank)
Munehiro Inada (Sbi Liquidity Market Co Ltd)

Topics
Asset Class Focused Research
Fixed Income Research
Reports
Credit Analysis Research
Credit Research

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UUID: 7947283

HALISTER1: DBRS: Canadian Western Bank Reports Q3 2016 Earnings

DBRS: Canadian Western Bank Reports Q3 2016 Earnings

Alert: HALISTER1
Source: DBR (Dominion Bond Rating Service)

Tickers
CWB CN (Canadian Western Bank)

People
Maria-Gabriella Khoury (DBRS Inc)

Topics
Earnings Review Research
Fixed Income Research
Fundamental Research
Reports
Research Comments

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UUID: 7947283