Over the past decade there have been a number of securities that feature the option to convert into ordinary equity at a pre-defined date. The conditions that trigger convertibility vary with each security but given this exposure, the price of security can be impacted by the underlying share price. The ratio of shares the investor receives for each security is [...]
With the September bank reporting season now complete, several common themes have emerged across the sector that we expect to continue to play out over the next twelve months. Earnings increase but margins remain under pressure and growth targets lowered. Although cash earnings for Australian banks remained robust during 2016 revenue growth is becoming difficult, suggesting the earnings cycle may [...]
With ~$4.7 billion of net issuance of ASX-listed debt and hybrid securities in 2016, investors have not been short of supply but with three large-scale hybrids due for redemption before years end, where will this maturing capital go? Figure 1. 2016 Transactions Date Ticker Issuance ($m) Replaced ($m) Net Issuance ($m) 30-Mar-16 CBAPE $1,450 PCAPA - $1166 $284 7-Jun-16 PPCHA $100 PPCG [...]
Back in February 2016, trading margins of ASX-listed hybrid securities widened significantly. As a result, there were a number of attractive investment opportunities and following a relatively stable reporting season and shift in sentiment, margins began to retrace. While on the surface it appears margins are still tracking well relative to February, a more suitable performance measure would be to calculate [...]
The PaperlinX story never ends and continues to find its way into the media. For those who do not know, the PaperLinX Step-Up Preference Securities (ASX: PXUPA) initially listed in March 2007 and has been one of the worst performing securities in the ASX-listed debt and hybrid market over the past decade. The underlying entity, PaperlinX Limited, was hit hard by [...]
The BondAdviser Corporate Hybrid Handbook 2017 is designed to be a useful reference for ASX-listed corporate hybrid securities and the credit profiles of their underlying issuers. We believe there are a number of attractive investment opportunities across different corporate industries and the recommendation table below reflects our views on these particular securities. Corporate hybrids are overshadowed in a market dominated [...]
During the September quarter, the listed interest rate security market performed strongly with credit spreads across most securities tightening as investors continued to seek higher yielding investments against the backdrop of a low interest rate environment. Securities received a boost in August as the Reserve Bank of Australia (RBA) reduced the official cash rate from an already low rate of [...]
Bank hybrids have been issued in the Australian financial landscape for over 20 years in various forms. While drivers of performance have varied over this period, they are typically cyclical and have a recurring impact on security trading margins (albeit at different magnitudes). The focus of the article will be on what is technically known as an Additional Tier 1 [...]
In our second half outlook, “Where to from here?”, we expected Australian companies to report slightly weaker headline results (revenue) with profits remaining relatively stable for period ending June 2016. We also expected an increasing number of them to favour shareholder friendly measures or turn to acquisitions for growth as organic revenue growth will be difficult during a period sustained [...]
On the 17th of December 2015, the Australian Prudential Regulation Authority (APRA) released for consultation a draft version of the Prudential Practice Guide for Capital Buffers (APG 110). On the 30th of August 2016 APRA addressed the key response to this submission. The Australian Banking Association raised concerns over the ability of an Authorised Deposit-taking Institution (ADI) to make Additional [...]
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ABN 31 164 148 467 ‧ Important Information
This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.
