06 July – 10 July 2015

Share

[private role=’subscriber’]

CBA PERLS VII end of tax year trading
Readers may recall last week’s piece on end-of–June trading in various hybrids and how a sample of six were sold off in the final days of the financial year, only to rebound in the first few days of the new financial year. It was put down to tax loss selling, a switch to bank equities and Greek concerns. It seems that in the case of CBA’s PERLS VII, brokers associated with the underwriters to the issue were heavy sellers of the hybrids before 30 June and the selling did not extend into the new financial year.

ANZ hybrids were a mixed bag last week. ANZPD and ANZPE turned down in margin, whereas the shorter dated ANZPC and ANZPA appeared high, especially given their shorter maturities.
hybrid_1

Despite equity markets volatility and credit generally widening last week, major bank hybrids found good buying. Volumes post-30 June were not as heavy as the previous week.

Our chart is a scatter plot of the major banks with some valuation discrepancies emerging.
hybrid[/private]

[private role=’subscriber’]

ASX LISTED HYBRIDS

COMPANYCODE HYBRID
TYPE
MATURITY OR
STEP-UP DATE
MARGIN
INC FRANK
TRADING
MARGIN
∆ WEEK WEEK
CLOSE
YTM Est** S&P CREDIT
RATING
COMP/HYBRID
ANZ Banking GroupANZPAMCPS I16/12/20163.10%3.23%0.30%100.155.37%AA-/BBB
ANZ Banking GroupANZPCMCPS II28/09/20173.10%3.79%0.01%100.506.04%AA-/BBB+
ANZ Banking GroupANZPDMCPS II1/09/20213.40%4.00%-0.19%99.036.25%AA-/BBB+
ANZ Banking GroupANZPECapital Note24/03/20223.25%4.07%-0.15%97.256.32%AA-/
Bendigo BankBENHBPerpetual21/10/20541.00%2.63%-0.04%75.504.77%A-/BBB
Bendigo BankBENPDMCPS II13/12/20175.00%4.09%0.01%102.56.34%A-/BBB-
Bendigo BankBENPEMCPS II30/11/20203.20%4.23%0.11%96.006.48%N/A
Bendigo BankBENPFMCPSII15/06/20214.00%4.42%-0.07%98.406.67%/BBB-
Bank Of QueenslandBOQPDMCPS II15/04/20185.10%3.51%-0.32%105.705.76%BBB+/BB+
CBA PERLS 3PCAPAStep Up6/04/20161.05%2.82%0.23%197.454.96%AA-/BBB
CBA PERLS 6CBAPCMCPS II15/12/20183.80%3.24%-0.41%102.105.38%AA-/BBB-
CBA PERLS 7CBAPDMCPS II15/12/20222.80%4.02%-0.04%93.306.16%AA-/BBB-
ChallengerCGFPACapital Note25/05/20203.40%4.65%-0.15%95.606.79%-/-
EldersELDPAPerp'l Pref30/06/2051N/A0.00%0.00%73.010.00%N/A
IAGIAGPCMCPS II1/05/20174.00%2.63%-0.26%103.504.88%A+/A-
IAG RESIANGReset pref16/12/20194.00%3.11%-0.05%103.865.25%A+/BBB+
Macquarie BankMBLHBIncome SecPerpetual1.70%3.81%-0.01%72.005.95%A/BB+
MacquarieMBLPACapital Note24/03/20213.30%3.94%0.02%98.606.19%A/-
MacquarieMQGPACapital Note7/06/20194.00%3.77%0.06%100.926.02%A-/BBB-
Multiplex SITESMXUPAPerp'l PrefPerpetual3.90%5.39%0.07%83.307.53%BB+/BB
Nat Aust BankNABHAIncome SecPerpetual1.25%3.22%0.15%72.555.36%AA-/BBB
Nat Aust BankNABPAMCPS II20/03/20193.20%3.79%-0.18%98.305.93%AA-/BBB-
Nat Aust BankNABPBMCPS II17/12/20203.25%3.98%-0.09%97.006.12%AA-/BBB-
NufarmNFNGStep UpPerpetual3.90%5.50%0.01%83.867.75%BB /B+
PaperlinxPXUPAPerp'l Pref30/06/2052N/A8.80%0.00%7.2811.05%N/A
Ramsay Health CareRHCPAPerp'l PrefPerpetual4.85%4.65%-0.10%104.006.90%BBB/BB+
Suncorp-MetwaySBKHBIncome SecPerpetual0.75%2.26%-0.02%0.004.40%A+/A-
SuncorpSUNPCMCPS II17/12/20174.65%3.68%-0.15%102.605.82%A /BBB+
SuncorpSUNPEMCPS II17/06/20203.40%3.88%0.00%98.306.02%A /BBB+
Seven Network TELYS 4SVWPAPerp'l Pref2/12/20544.75%7.13%0.18%78.309.38%BB+/BB-
WestpacWBCPCMCPS II31/03/20183.25%3.26%-0.40%101.455.51%AA-/BBB-
WestpacWBCPDMCPS II8/03/20193.20%3.71%-0.18%98.775.85%AA-/BBB-
WestpacWBCPEMCPS II22/09/20223.05%4.14%0.17%94.106.28%AA-/BBB+
WestpacWCTPAStep Up30/06/20161.00%3.18%-0.11%98.005.32%AA-/BBB

** YTM for floating rate securities is an estimate using current interest rates. This will vary if rates change.
Source: Evans & Partners. Dealing Contact Michael Saba +61 3 9631 9813

[/private]