MENA Daily Fixed Income Report - 9 December

Transcription

1. MENA Daily Fixed Income Report – 9 December 2020 Kuwait Financial Centre “Markaz” News Updates Burgan Bank K.P.S.C. 11NC6 Subordinated Tier 2 Notes Due 2031 priced at 2.750% – Burgan Bank K.P.S.C. 11NC6 Subordinated Tier 2 Notes Due 2031 priced its USD Benchmark issue at 2.750% fixed per annum from the Issue Date until the Reset Date. Resets to the then prevailing 5-Year US Treasury Rate (the “Reset Rate”) plus the Margin on the Reset Date. Interest Payments will be payable semi-annually in arrears on 15 June and 15 December in every year, commencing on 15 June 2021. Joint Lead Managers & Bookrunners included Bank ABC, Citi, Emirates NBD Capital, First Abu Dhabi Bank, HSBC, J.P. Morgan, Kamco Invest, Mizuho Securities, MUFG, NBK Capital and Standard Chartered Bank (B&D). (Source: Bloomberg) Gulf’s Stimulus Outlier Puts Off New Taxes, Weighs Longer Relief – Bahrain could extend the duration of support measures to help businesses cope with the impact of the coronavirus after deploying the Gulf region’s biggest stimulus relative to economic output. Before following some of its neighbors and exploring raising taxes to boost revenue, the focus is now on ensuring that a projected recovery gathers pace next year, Finance Minister Sheikh Salman bin Khalifa al Khalifa said in an interview. The government will “do what is necessary to ensure a positive path” while “observing very closely” what countries including Saudi Arabia and Oman are doing to bolster income, he said. (Source: GCC Sovereign Yields Sovereigns 2025 0.83 Abu Dhabi 2030 1.60 Abu Dhabi 2050 2.70 Bahrain 2026 3.33 Bahrain 2030 4.69 Bahrain 2047 6.10 Dubai 2029 2.61 Bloomberg) KSA 2025 1.21 Price ∆ (YTD %) 6.65 9.43 KSA 2030 2.10 10.24 KSA A1 A-u A 19.93 KSA 2050 3.26 9.70 UAE Aa2 NR AA- -1.20 Oman 2025 4.39 -2.03 AA AA Oman 2029 5.53 -1.73 Abu Dhabi Aa2 17.28 Qatar Aa3 AA- AA- -3.70 Oman 2048 6.84 -2.18 2.51 Qatar 2025 0.97 6.46 Bahrain B2 B+ B+ Oman Ba3 B+ BB- Egypt B2 B B+ Lebanon C SD RD Jordan B1 B+ BB- Turkey B2 B+u BB- Tunisia B2 NR Sovereigns Maturity Yield % Kuwait 2022 0.19 1.40 Qatar 2030 1.75 11.49 Kuwait 2027 1.13 5.84 Qatar 2050 2.78 23.41 Bonds and Sukuk Indices Yield % Duration (yrs) 1D ∆ (%) YTD ∆ (%) Bloomberg GCC FI Index 2.52 8.08 -0.08 8.17 S&P MENA Bond and Sukuk Index 2.05 NA -0.07 8.74 Bloomberg Emerging Markets USD Index 3.62 6.80 -0.01 5.37 Bloomberg Global Aggregate Index 0.86 7.42 0.07 8.31 Index Name Interbank Rates (%) KIBOR SAIBOR BHIBOR QATAR AEIBOR EURIBOR LIBOR 3 Months 9/12/2020 31/12/2019 1.4375 2.7500 0.8288 2.2314 2.2500 2.6667 1.1153 2.2500 0.3575 2.2086 -0.5340 -0.3830 0.2304 1.9084 6 Months 9/12/2020 31/12/2019 1.6875 2.9375 0.8775 2.2557 2.5333 2.7000 1.1824 2.3500 0.5568 2.1914 -0.5130 -0.3240 0.2531 1.9121 USD Swap Rates 1-Year 2-Year 5-Year 7-Year Bloomberg) 10-Year Fitch Sees Sovereign Defaults Despite Better 2021 Credit Outlook – 30-Year The environment for sovereign credit will be more favorable in 2021 with the emergence of medical solutions to the virus, though there could be more defaults next year, according to Fitch Ratings. “Favorable funding conditions will not prevent pockets of acute emerging-market stress and possible defaults next year,” Fitch stated. A record 4 countries defaulted in 2020, and 11 nations are rated below B-, another record (Source: Sovereign Ratings Price ∆ (YTD %) 5.17 Yield % Abu Dhabi Bloomberg) Morocco Raises $3 Billion in Record Foreign Bond Sale – Morocco returned to international capital markets with a record foreign bond offering to shore up finances battered by the coronavirus. The government’s $3 billion bond offering included dollar-denominated seven-, 12- and 30-year securities, according to a person familiar with the matter who asked not to be identified. The deal priced at 175 basis points over U.S. Treasuries for $750 million of the shortest-duration notes, 200 basis points for $1 billion in 12-year bonds and 4% for the $1.25 billion in 30year securities, the person said. The deal marks the largest amount raised by the kingdom in a single international sale, according to data compiled by Bloomberg. It was Morocco’s second foreign bond sale of the year. Barclays Plc, BNP Paribas SA, JPMorgan Chase & Co. and Natixis SA were appointed lead managers of the sale, the person said. (Source: Maturity Yield % 0.2133 0.2305 0.4625 0.6804 0.9444 1.4167 Currencies 1D ∆ (bps) 0.05 0.12 0.55 1.10 1.69 2.65 YTD ∆ (%) -88.0 -86.4 -73.3 -62.1 -50.2 -32.3 US Treasuries 2-Year 5-Year 10-Year 30-Year 12 Months 9/12/2020 31/12/2019 1.9375 3.1875 0.9488 2.3071 2.6833 2.8333 1.2816 2.5333 0.5894 2.2900 -0.4990 -0.2490 0.3383 1.9963 KWD SAR BHD QAR OMR AED USD 0.3044 3.7517 0.3771 3.6417 0.3850 3.6730 UK Guilts Yield % 0.15 0.40 0.94 1.69 1D ∆ (%) 0.00 -0.04 -0.17 -0.64 Yield % -0.10 -0.05 0.25 0.80 1D ∆ (bps) 0.0000 -0.0053 0.0080 -0.0082 0.0026 0.0000 YTD ∆ (%) -0.43 -0.01 0.01 0.00 0.00 0.00 German Bunds 1D ∆ (%) 0.01 0.05 0.31 1.42 Yield % -0.79 -0.80 -0.66 -0.19 1D ∆ (%) 0.02 0.06 0.19 0.88 Moody’s S&P Kuwait A1 AA- Fitch AA B Morocco Ba1 BBB- BB+ US Aaa AA+u AAA UK Aa2 AAu AA- China A1 A+ A+ USD 5Yr CDS 9-Dec 2020 31-Dec 2019 Kuwait 39.19 36.700 KSA 63.80 56.915 Abu Dhabi 34.75 36.090 Dubai 103.29 91.005 Qatar 35.14 36.705 Bahrain 241.24 175.995 Oman 348.16 234.400 Iraq 496.48 383.680 Egypt 332.69 277.420 Morocco 86.70 91.435 Turkey 356.53 282.130 US 12.81 10.810 UK 16.10 16.210 China 28.26 31.205 Japan 14.46 21.042 Germany 9.60 7.080 France 15.08 16.130 Source: Bloomberg This report has been prepared and issued by Kuwait Financial Centre K.P.S.C. (Markaz) , which is regulated by the Capital Markets Authority and the Central Bank of Kuwait. The report is owned by Markaz and is privileged and proprietary and is subject to copyrights. Sale of any copies of this report is strictly prohibited. This report can not be published. A number of sources which include Bloomberg, Zawya, and daily newspapers were utilized in the creation of this report.