EU FINANCIALS: Iccrea (ICCREA) - Q4 Results
Pretty good. Credit Neutral. Will want CoR to not move higher again and will want to see fee income recur.
• NII of €312 is flat on Q3 and -7.5% on Q4 24. Fee income of €184m is up €30m and c.20% on Q3 and Q4 23 - which more than offsets decline in NII.
• Expenses are 9.1% higher than Q4 23 on contractual increases and variable components on higher fee income
• Cost of risk rises to 32bps for the quarter - but the overall asset quality remains better than Italian/EU averages.
• CET1 of 16.7% is -0.5% lower than Q3, but up 1.2Q on Q4 23.
• 2 tier 2s callable in 2025, summing to €312m is Sep and Nov - could be replaced by 1 issue. Maybe as soon as March or potentially after Q1's
Valuation - The CRDEM 7.625's will still screen positively, although its small size (the bank and the issue) will reduce eligible owners. The name has already outperformed BACRED by a meaningful amount in 2024, and now trades in-line. An index eligible tier 2, as mentioned about could be a positive catalyst this year.
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FRANCE AUCTION RESULTS: 13/28/46/50-Week BTFs
| Type | 13-week BTF | 28-week BTF | 46-week BTF | 50-week BTF |
| Maturity | Apr 16, 2025 | Jul 30, 2025 | Dec 3, 2025 | Dec 31, 2025 |
| Amount | E3.397bln | E1.96bln | E599mln | E1.897bln |
| Target | E3.0-3.4bln | E1.6-2.0bln | E0.2-0.6bln | E1.5-1.9bln |
| Previous | E3.497bln | E1.594bln | E599mln | E1.799bln |
| Avg yield | 2.695% | 2.595% | 2.495% | 2.495% |
| Previous | 2.704% | 2.592% | 3.602% | 2.435% |
| Bid-to-cover | 2.82x | 3.73x | 6.08x | 3.53x |
| Previous | 2.17x | 4.43x | 1.94x | 3.98x |
| Previous date | Jan 06, 2025 | Jan 06, 2025 | Aug 21, 2023 | Jan 06, 2025 |
OAT: Block trade
OAT Block trade, suggest seller:
- OATH5 ~1.1k at 120.90.
PIPELINE: Corporate Bond Issuance Roundup: Get While Getting is Good
US$ corporate and supra-sovereign debt issuance resumes after last week's record $135.55B priced. Rush to secure cash ahead of the next earning's cycle that starts in earnest this week: Blackrock, Bank of NY Melon, Wells Fargo, JP Morgan, Goldman Sachs, Citigroup, US Bancorp, M&T Bank and PNC all reporting between January 15-16.
- Date $MM Issuer (Priced *, Launch #)
- 01/13 $3B KFW +5Y +43a
- 01/13 $2B CADES 5Y SOFR+70a
- 01/13 $Benchmark IFC 3Y SOFR+33a
- 01/13 $Benchmark CAF 5Y SOFR+90a
- 01/13 $Benchmark CBA 5Y SOFR+72a
- 01/13 $Benchmark EBRD 5.5Y SOFR+42
- 01/13 $Benchmark Ares Strategic 7Y +200a
- 01/13 $Benchmark BNG Bank 5Y SOFR+50a
- 01/13 $Benchmark KHFC 5Y +95a, 5Y SOFR
- 01/13 $Benchmark British Colombia 3Y SOFR+46a
- 01/13 $Benchmark Eastern Energy Gas 10Y +130a, 30Y +150a
- 01/13 $Benchmark Standard Chartered 4NC3, 4NC3 SOFR, 11NC10
- $5B Priced Friday for record high of $135.55B total on week
