PrefBlog

Issue Comments

L.PR.B Trend Positive, Says DBRS

has today confirmed the Issuer Rating, Medium-Term Notes and Debentures ratings of Loblaw Companies Limited (Loblaw or the Company) and the Senior Unsecured Debt rating of Shoppers Drug Mart Corporation (Shoppers) at BBB as well as Loblaw’s Short-Term Issuer Rating at R-2 (middle) and its Second Preferred Shares rating at Pfd-3. DBRS has changed the trends to Positive from Stable.
…
The trend change reflects the Company’s deleveraging efforts and successful integration subsequent to the acquisition of Shoppers as well as its solid operating performance in both food retail and pharmacy through the end of F2015. The ratings continue to be supported by Loblaw’s business profile which is considered very strong for the current BBB rating, featuring industry-leading size, scale and market positions in retail and pharmacy across Canada. The ratings also incorporate the intense competition in food retail in Canada and the risks associated with drug pricing and pharmacy reforms.
…
Loblaw’s financial profile should continue to improve over the medium term, benefiting from growth in earnings and cash flows as balance-sheet debt should remain relatively stable. Cash flow from operations should continue to track operating income while capital expenditures (capex) attributable to the retail operations is expected to decline moderately to approximately $1.0 billion. Retail capex will focus on improving existing stores as well as new food and drug store openings as larger supply chain and IT initiatives have been completed. DBRS believes that dividends on a per-share basis will continue to grow at a steady pace, but the cash outlay for dividends should remain near the $400 million level (as share repurchases are completed). As such, DBRS believes that free cash flow before changes in working capital should increase toward the $900 million to $1.0 billion range. Free cash flow is expected to be used to complete share repurchases. As a result, DBRS believes that balance-sheet debt should remain relatively stable and credit metrics should continue to improve as earnings grow.

If DBRS becomes confident in the next six to 12 months that Loblaw’s operating performance will remain sound and balance-sheet debt will remain fairly stable resulting in continued improvement in credit metrics, a ratings upgrade to the BBB (high) level would likely result.

L.PR.B is a 5.30% Straight Perpetual that commenced trading 2016-3-11 after being announced 2015-6-2. It is tracked by HIMIPref™ but relegated to the Scraps index on credit concerns.

Issue Comments

SJR.PR.A Downgraded To Pfd-3(low) By DBRS

DBRS has announced that it:

has today downgraded Shaw Communications Inc.’s (Shaw or the Company) Issuer Rating and Senior Notes rating to BBB (low) from BBB and its Preferred Shares rating to Pfd-3 (low) from Pfd-3. The trends are Stable. This action follows the closing of the Company’s acquisition of WIND Mobile Corp. (WIND) and the announcement to sell its broadcasting subsidiary, Shaw Media Inc. (Shaw Media) to Corus Entertainment Inc. (Corus). The rating action is caused by a gradual erosion in the core cable business owing to persistent subscriber weakness and the expectation that the recent transactions will result in a material weakening of Shaw’s free cash flow profile over the near to medium term.
…
DBRS notes that Shaw’s earnings profile has been under pressure for some time, owing to continued technological substitution of phone and cable services, increased competition from TELUS Corporation’s (TELUS) Internet protocol television (IPTV) offering and, more recently, economic softness in Alberta, regulatory-driven headwinds. Subscriber erosion accelerated in F2015, with a 3.2% decline recorded in total revenue generating units following a 0.8% decline in F2014. As such, Shaw has had to rely more heavily on price increases to drive earnings growth within its wireline business amid an increasingly competitive telecommunications market. Organic growth was weak in F2015, with much of the revenue and EBITDA increases (4.7% and 5.2%, respectively) attributable to the full-year inclusion of ViaWest. DBRS believes that, independent of the recent transactions, because of mounting pressures on subscribers and expectations of less predictable and potentially more strained organic earnings going forward, Shaw is more appropriately placed in the BBB (low) rating category.
…
In terms of financial profile, DBRS expects leverage to be reasonable for the revised rating category. As proceeds from the sale of the media assets will be used to pay for the WIND transaction, Shaw will not be required to raise additional debt financing. Pro forma total debt is expected rise to $5.9 billion by year-end F2016 from $5.7 billion in F2015, but this is because of a recent debt-financed tuck-in acquisition by ViaWest. EBITDA, however, is expected to decline with the divestiture of Shaw Media’s operating income and the modest contribution of WIND. As such, pro forma gross debt to EBITDA is expected to peak at roughly 2.8 times (x) by year-end F2017 from 2.4x in the last 12 months Q1 F2016. DBRS notes that the Company has reiterated its long-term target of net debt-to-EBITDA of between 2.0x and 2.5x.

This follows the December, 2015, expressions of nervousness regarding Shaw and the assessment of a negative outlook by S&P in January 2016.

New Issues

New Issue: CWB FixedReset, 6.25%+547, NVCC

Canadian Western Bank has announced (but not yet on their website):

its intent to issue $100 million non-cumulative 5-year rate reset First Preferred Shares Series 7 (Non-Viability Contingent Capital (NVCC)) (the “Series 7 Preferred Shares”). The offering will be underwritten on a bought deal basis by a syndicate led by National Bank Financial Inc. The expected closing date is on or about March 31, 2016.

Under the terms of the offering, CWB will issue 4,000,000 Series 7 Preferred Shares at a price of $25.00 per share. CWB has also granted the underwriters an over-allotment option, solely to cover over-allotments, if any, exercisable for a period of 30 days following the closing date of the offering, to purchase up to an additional 600,000 Series 7 Preferred Shares on the same terms. Should the underwriters choose to exercise this option in full, the maximum gross proceeds raised under the offering will be $115 million.

Holders of the Series 7 Preferred Shares will be entitled to receive a non-cumulative fixed dividend in the amount of $1.5625 annually, payable quarterly, as and when declared by the Board of Directors of CWB, for the initial period ending July 31, 2021. The quarterly dividend represents an annual yield of 6.25% based on the stated issue price per share. Thereafter, the dividend rate will reset every five years at a level of 547 basis points over the then 5-year Government of Canada bond yield. The first of such dividends, if declared, will be payable on July 31, 2016 and will be $0.5223 per Series 7 Preferred Share, based on the anticipated closing date of the offering of March 31, 2016. CWB maintains the right to redeem, subject to the approval of the Office of the Superintendent of Financial Institutions (“OSFI”), up to all of the then outstanding Series 7 Preferred Shares on July 31, 2021, and on July 31 every five years thereafter at a price of $25.00 per share.

Should CWB choose not to exercise its right to redeem the Series 7 Preferred Shares, holders of these shares will have the right to convert their shares into an equal number of non-cumulative floating rate First Preferred Shares Series 8 (Non-Viability Contingent Capital (NVCC)) (the “Series 8 Preferred Shares”), subject to certain conditions, on July 31, 2021, and on July 31 every five years thereafter. Holders of the Series 8 Preferred Shares will be entitled to receive quarterly floating dividends, as and when declared by the Board of Directors of CWB, equal to the 90-day Government of Canada Treasury Bill rate plus 547 basis points.

Net proceeds from the offering will be added to CWB’s capital base and used for general corporate purposes and are expected to qualify as Tier 1 capital for CWB. The offering will be completed by way of short form prospectus to be filed in all provinces and territories of Canada.

This issue will be tracked by HIMIPref™ and assigned to the Scraps index on credit concerns.

This issue looks like it’s priced with a small concession. The bank’s extant FixedReset, CWB.PR.B, 4.40%+276 is currently bid at 16.35 to yield 5.66% to perpetuity, compared to 6.13% to perpetuity for the new issue (assuming a thirty year end-price of 23.14). Thus, the 271bp difference in Issue Reset Spread gives rise to a 47bp difference in yield, slightly above the norm.

Market Action

March 10, 2016

Europe continues to ease monetary policy:

In the face of a global debate on whether monetary policy has lost its effectiveness and is even planting the seeds of the next crisis, the ECB has delivered a solid defense of the right and power of central banks to boost growth and inflation at will. The best that can be said for euro-area fiscal policy is that it’s not hampering the recovery, so Draghi has underlined that he won’t wait for others to act.
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The president announced cuts to all three of the ECB’s rates, bringing the deposit rate to minus 0.4 percent, and a 20 billion-euro ($22 billion) expansion of quantitative easing that for the first time opens the door to purchases of corporate bonds. On top of that, he announced a new four-year loan program that potentially allows banks to be remunerated for taking the ECB’s money if they expand credit to the real economy, in a quartet of operations stretching to 2021.

Draghi’s policy arc has been in defiance of warnings by monetary conservatives, including those in Germany’s Bundesbank since the beginning of his term, up to more recent calls by the Group of 20 nations to shift the burden of growth generation away from monetary policy and toward structural policies or more government investment.

Instead, Draghi sounded resigned when asked about euro-area fiscal policy. That domain spans countries including Spain, France and Italy that are close to their legal deficit limits, and nations that can afford to spend more — read Germany — that have promised voters they won’t do so.

Certainly the OSC is working hard to spark inflation:

The Ontario Securities Commission says its revenues will rise almost 14 per cent in its current fiscal year, leaving the regulator with a surplus of $6.6-million for the year.

The commission published details of its financial outlook Thursday for the fiscal year ending March 31, saying revenue has climbed due to fee changes introduced last year. Those fee adjustments, as well as fee increases introduced in 2013, have returned the commission to strong profitability after it recorded deficits from 2009 to 2013.

The OSC said it expects to take in revenue of $115.8-million in fiscal 2016, a 14-per-cent increase from $101.6-million in fiscal 2015. Expenses are expected to climb sharply to $109-million in the current year from $96.9-million in fiscal 2015, leaving the OSC with an anticipated surplus of $6.6-million this year, up from $4.7-million last year.

Market participants – including listed companies, investment firms and other registrants – pay participation and activity fees to the OSC, which account for more than 99 per cent of its revenue. The OSC adjusted its fee structure last year to base its participation fees on a firm’s most recent annual financial results so they closely track current market conditions.

Perhaps they now have enough to cut another cheque to their good buddies at FAIR Canada!

Canada is now a net creditor of the US – but I would really like to see some currency-adjusted figures!:

Canada is now a creditor to the U.S. for the first time on record, government data show, reflecting the northern nation’s love affair with assets south of the border.

The stock of U.S. assets held by Canadians in the fourth quarter of 2015 — everything from corporate acquisitions to portfolio investments — exceeded assets held by Americans in Canada for the first time since at least 1990, according to quarterly data published Thursday by Statistics Canada.

Easy credit, strong balance sheets, and lack of investing opportunities at home have been the main factors driving Canadian money managers and companies on a shopping spree south of the border. The value of those investments has jumped over the last couple of years as the U.S. dollar has strengthened. U.S. investors, meanwhile, haven’t been reciprocating.
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Canada’s total net asset position with all countries rose to C$472 billion in the fourth quarter. That’s good news from a creditworthiness point of view. The more indebted a country is to foreigners the more vulnerable it is to financial shocks and Canada’s creditor status helps in times like this when financial markets are volatile, commodity prices are falling and the country is running large current account deficits.

The US is moving to get some more work out of its foreign graduates:

The federal government will publish the rule on Friday, saying that international students earning degrees in science, technology, engineering and mathematics fields in the United States will now be eligible to stay for three years of on-the-job training. This is seven months longer than under the 2008 rule it replaces for the STEM Optional Practical Training program, known as OPT. The new rule will take effect on May 10.
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This rule is yet another flash point in the controversy over immigration reform. Industry leaders who say they are desperate for skilled talent and those defending the rights of American workers see the training program’s extension as an end-around to stalled reform. But that is all they agree upon.

“It’s an ongoing assault on American workers,” said John Miano, a lawyer for a technology workers’ union in Washington State, whose lawsuit last summer was what forced the government to vacate the previous rule and create a new one, this time for public comment.

There is speculation that TransCanada is contemplating a large acquisition:

TransCanada Corp. would snap up a big chunk of the natural gas business that’s given it the most troublesome competition if it completes a speculated U.S. takeover worth more than $9-billion (U.S.).

TransCanada said on Thursday that it was in talks with a third party, but did not name it or provide any guarantees that it would clinch a deal.

The company is in talks with Houston-based Columbia Pipeline Group Inc., according to the Wall Street Journal, which cited anonymous sources. Columbia is best known for its extensive pipeline network in the Marcellus and Utica natural gas regions in the U.S. Northeast.

Merrill Lynch has come up with some interesting figures on Canadian housing turnover:

Here are three key numbers to keep in mind when you’re talking about Canada’s housing markets: 24, 17 and 10.

Those, according to research from Bank of America Merrill Lynch, highlight the frothy nature of real estate in British Columbia and Ontario, compared with the rest of the country.

They’re the number of existing home sales per 1,000 people.

In B.C., home to Canada’s hottest market, the ratio is 24 per 1,000 in Vancouver. In Ontario, where Toronto is also a hotbed, it’s 17. And in the rest of Canada, it’s just 10, according to the bank’s North America economist, Emanuella Enenajor.

“Although Canada’s housing market may not be in a bubble, the B.C. (British Columbia) market likely is,” Ms. Enenajor said in her report.

It was an off day for the Canadian preferred share market, with PerpetualDiscounts and DeemedRetractibles both off 21bp and FixedResets down 39bp. The Performance Highlights table continues to show a lot of churn. Volume was well below average.

For as long as the FixedReset market is so violently unsettled, I’ll keep publishing updates of the more interesting and meaningful series of FixedResets’ Implied Volatilities. This doesn’t include Enbridge because although Enbridge has a large number of issues outstanding, all of which are quite liquid, the range of Issue Reset Spreads is too small for decent conclusions. The low is 212bp (ENB.PR.H; second-lowest is ENB.PR.D at 237bp) and the high is a mere 268 for ENB.PF.G.

Remember that all rich /cheap assessments are:
» based on Implied Volatility Theory only
» are relative only to other FixedResets from the same issuer
» assume constant GOC-5 yield
» assume constant Implied Volatility
» assume constant spread

Here’s TRP:

Click for Big

TRP.PR.E, which resets 2019-10-30 at +235, is bid at 17.25 to be $1.27 rich, while TRP.PR.C, resetting 2021-1-30 at +296, is $0.84 cheap at its bid price of 11.06.

Click for Big

Most expensive is MFC.PR.N, resetting at +230bp on 2020-3-19, bid at 17.50 to be 1.01 rich, while MFC.PR.G, resetting at +290bp on 2016-12-19, is bid at 17.78 to be 1.11 cheap.

Click for Big

The cheapest issue relative to its peers is BAM.PR.R, resetting at +230bp on 2016-6-30, bid at 13.94 to be $1.11 cheap. BAM.PF.E, resetting at +255 on 2020-3-31 is bid at 17.35 and appears to be $1.06 rich.

Click for Big

FTS.PR.K, with a spread of +205bp, and bid at 15.12 looks $0.52 expensive and resets 2019-3-1. FTS.PR.H, with a spread of +145bp and resetting 2020-6-1, is bid at 11.09 and is $0.39 cheap.

Click for Big

Investment-grade pairs predict an average three-month bill yield over the next five-odd years of -0.73%, with three outliers below -1.50% and one above +0.50%. Note that the range of the y-axis has changed today. There are two junk outliers below -1.50%.

Click for Big

Shall we just say that this exhibits a high level of confidence in the continued rapacity of Canadian banks?

HIMIPref™ Preferred Indices These values reflect the December 2008 revision of the HIMIPref™ Indices Values are provisional and are finalized monthly
Index	Mean Current Yield (at bid)	Median YTW	Median Average Trading Value	Median Mod Dur (YTW)	Issues	Day’s Perf.	Index Value
Ratchet	5.11 %	6.21 %	12,271	16.42	1	0.0000 %	1,534.4
FixedFloater	7.19 %	6.31 %	24,098	15.96	1	0.1515 %	2,766.6
Floater	4.55 %	4.77 %	71,868	15.82	4	-0.7646 %	1,684.8
OpRet	0.00 %	0.00 %	0	0.00	0	0.1939 %	2,756.1
SplitShare	4.82 %	5.48 %	70,996	2.64	7	0.1939 %	3,225.2
Interest-Bearing	0.00 %	0.00 %	0	0.00	0	0.1939 %	2,516.4
Perpetual-Premium	5.81 %	-0.61 %	74,756	0.08	6	0.0794 %	2,541.1
Perpetual-Discount	5.72 %	5.77 %	96,300	14.18	33	-0.2096 %	2,528.0
FixedReset	5.57 %	5.19 %	201,732	14.28	86	-0.3913 %	1,827.6
Deemed-Retractible	5.33 %	5.66 %	114,768	5.12	34	-0.2115 %	2,553.0
FloatingReset	3.09 %	5.08 %	40,146	5.45	16	0.1835 %	1,984.6

Performance Highlights
Issue	Index	Change	Notes
BAM.PF.B	FixedReset	-5.59 %	Nonsensical, as the issue traded 4,725 shares in a range of 16.75-00 before closing at 16.05-17.19, 8×1. VWAP was 16.89. I have not checked whether this lamentable state of affairs is due to inadequate Toronto Stock Exchange reporting or inadequate Toronto Stock Exchange supervision of market-makers. YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-10 Maturity Price : 16.05 Evaluated at bid price : 16.05 Bid-YTW : 5.57 %
TD.PF.C	FixedReset	-4.70 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-10 Maturity Price : 16.23 Evaluated at bid price : 16.23 Bid-YTW : 4.89 %
TRP.PR.D	FixedReset	-4.05 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-10 Maturity Price : 16.12 Evaluated at bid price : 16.12 Bid-YTW : 5.12 %
MFC.PR.M	FixedReset	-3.97 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 16.95 Bid-YTW : 8.80 %
BAM.PR.X	FixedReset	-3.50 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-10 Maturity Price : 12.70 Evaluated at bid price : 12.70 Bid-YTW : 5.39 %
TRP.PR.C	FixedReset	-2.98 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-10 Maturity Price : 11.06 Evaluated at bid price : 11.06 Bid-YTW : 5.16 %
FTS.PR.H	FixedReset	-2.97 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-10 Maturity Price : 11.09 Evaluated at bid price : 11.09 Bid-YTW : 5.09 %
TRP.PR.F	FloatingReset	-2.78 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-10 Maturity Price : 11.52 Evaluated at bid price : 11.52 Bid-YTW : 5.12 %
HSE.PR.A	FixedReset	-2.77 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-10 Maturity Price : 9.14 Evaluated at bid price : 9.14 Bid-YTW : 6.84 %
PWF.PR.T	FixedReset	-2.50 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-10 Maturity Price : 19.10 Evaluated at bid price : 19.10 Bid-YTW : 4.31 %
TRP.PR.H	FloatingReset	-2.38 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-10 Maturity Price : 9.03 Evaluated at bid price : 9.03 Bid-YTW : 4.76 %
TD.PR.Y	FixedReset	-2.27 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 23.28 Bid-YTW : 4.37 %
FTS.PR.M	FixedReset	-2.24 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-10 Maturity Price : 16.60 Evaluated at bid price : 16.60 Bid-YTW : 5.13 %
BMO.PR.Q	FixedReset	-2.08 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 17.90 Bid-YTW : 8.23 %
FTS.PR.K	FixedReset	-1.82 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-10 Maturity Price : 15.12 Evaluated at bid price : 15.12 Bid-YTW : 4.94 %
TRP.PR.A	FixedReset	-1.69 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-10 Maturity Price : 14.00 Evaluated at bid price : 14.00 Bid-YTW : 4.94 %
TRP.PR.G	FixedReset	-1.67 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-10 Maturity Price : 18.24 Evaluated at bid price : 18.24 Bid-YTW : 5.12 %
BNS.PR.Z	FixedReset	-1.57 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 18.79 Bid-YTW : 7.40 %
RY.PR.Z	FixedReset	-1.55 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-10 Maturity Price : 17.11 Evaluated at bid price : 17.11 Bid-YTW : 4.57 %
TD.PR.Z	FloatingReset	-1.53 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 21.25 Bid-YTW : 5.08 %
BAM.PR.R	FixedReset	-1.48 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-10 Maturity Price : 13.94 Evaluated at bid price : 13.94 Bid-YTW : 5.59 %
PWF.PR.A	Floater	-1.29 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-10 Maturity Price : 11.50 Evaluated at bid price : 11.50 Bid-YTW : 4.14 %
BAM.PR.B	Floater	-1.28 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-10 Maturity Price : 10.06 Evaluated at bid price : 10.06 Bid-YTW : 4.77 %
HSE.PR.C	FixedReset	-1.21 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-10 Maturity Price : 15.51 Evaluated at bid price : 15.51 Bid-YTW : 6.61 %
MFC.PR.J	FixedReset	-1.16 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 17.05 Bid-YTW : 8.74 %
BAM.PF.E	FixedReset	-1.14 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-10 Maturity Price : 17.35 Evaluated at bid price : 17.35 Bid-YTW : 5.19 %
BAM.PR.Z	FixedReset	-1.02 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-10 Maturity Price : 17.52 Evaluated at bid price : 17.52 Bid-YTW : 5.53 %
PWF.PR.P	FixedReset	1.01 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-10 Maturity Price : 12.00 Evaluated at bid price : 12.00 Bid-YTW : 4.87 %
GWO.PR.N	FixedReset	1.15 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 13.22 Bid-YTW : 10.35 %
MFC.PR.G	FixedReset	1.31 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 17.78 Bid-YTW : 8.37 %
BNS.PR.B	FloatingReset	1.31 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 20.87 Bid-YTW : 5.43 %
BMO.PR.R	FloatingReset	1.53 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 21.87 Bid-YTW : 4.50 %
MFC.PR.H	FixedReset	1.83 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 19.50 Bid-YTW : 7.37 %
BNS.PR.A	FloatingReset	1.83 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 23.37 Bid-YTW : 3.70 %
CIU.PR.C	FixedReset	2.19 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-10 Maturity Price : 10.75 Evaluated at bid price : 10.75 Bid-YTW : 4.85 %
MFC.PR.K	FixedReset	2.36 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 16.05 Bid-YTW : 9.24 %
MFC.PR.F	FixedReset	2.37 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 12.55 Bid-YTW : 11.11 %
IAG.PR.G	FixedReset	2.75 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 18.70 Bid-YTW : 7.63 %
TD.PF.D	FixedReset	7.04 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-10 Maturity Price : 18.54 Evaluated at bid price : 18.54 Bid-YTW : 4.81 %

Volume Highlights
Issue	Index	Shares Traded	Notes
TD.PF.G	FixedReset	126,731	RBC sold 19,100 to anonymous at 25.50. Scotai crossed 50,500 at the same price. TD crossed 25,000 at the same price again. YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-10 Maturity Price : 23.31 Evaluated at bid price : 25.50 Bid-YTW : 5.27 %
RY.PR.R	FixedReset	113,582	Recent new issue. YTW SCENARIO Maturity Type : Call Maturity Date : 2021-08-24 Maturity Price : 25.00 Evaluated at bid price : 25.32 Bid-YTW : 5.27 %
FTS.PR.M	FixedReset	106,150	Scotia crossed 99,400 at 17.15. YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-10 Maturity Price : 16.60 Evaluated at bid price : 16.60 Bid-YTW : 5.13 %
MFC.PR.M	FixedReset	83,179	Scotia crossed 74,800 at 17.80. YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 16.95 Bid-YTW : 8.80 %
RY.PR.Q	FixedReset	68,036	Scotia crossed 50,000 at 25.50. YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-10 Maturity Price : 23.31 Evaluated at bid price : 25.51 Bid-YTW : 5.20 %
TRP.PR.D	FixedReset	66,637	Desjardins crossed 50,000 at 16.90. YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-10 Maturity Price : 16.12 Evaluated at bid price : 16.12 Bid-YTW : 5.12 %
There were 22 other index-included issues trading in excess of 10,000 shares.

Wide Spread Highlights
Issue	Index	Quote Data and Yield Notes
GWO.PR.O	FloatingReset	Quote: 11.21 – 12.94 Spot Rate : 1.7300 Average : 1.2767 YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 11.21 Bid-YTW : 11.99 %
BAM.PF.B	FixedReset	Quote: 16.05 – 17.19 Spot Rate : 1.1400 Average : 0.7419 YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-10 Maturity Price : 16.05 Evaluated at bid price : 16.05 Bid-YTW : 5.57 %
TD.PF.C	FixedReset	Quote: 16.23 – 17.14 Spot Rate : 0.9100 Average : 0.5976 YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-10 Maturity Price : 16.23 Evaluated at bid price : 16.23 Bid-YTW : 4.89 %
CM.PR.Q	FixedReset	Quote: 18.57 – 19.30 Spot Rate : 0.7300 Average : 0.4861 YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-10 Maturity Price : 18.57 Evaluated at bid price : 18.57 Bid-YTW : 4.81 %
MFC.PR.M	FixedReset	Quote: 16.95 – 17.59 Spot Rate : 0.6400 Average : 0.3982 YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 16.95 Bid-YTW : 8.80 %
BNS.PR.Z	FixedReset	Quote: 18.79 – 19.33 Spot Rate : 0.5400 Average : 0.3473 YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 18.79 Bid-YTW : 7.40 %

Issue Comments

TA: Trend Changed To Negative By DBRS

DBRS has announced that it:

has today changed the trends of all long-term debt ratings of Capital Power Corporation, Capital Power L.P. and TransAlta Corporation (collectively, the IPPs) to Negative from Stable. DBRS has also changed the trend of TransAlta Corporation’s preferred share rating to Negative from Stable. The rating actions reflect DBRS’s concern that the continued challenging wholesale power market environment and heightened political risk in Alberta may lead the IPPs’ credit risk profile to deteriorate to a level that is no longer consistent with their respective rating categories. The rating actions at this time are limited to trend changes with no immediate rating downgrades, as the negative factors that could lead to downward rating pressure are over the medium to long term. DBRS does not anticipate any material weakness in the IPPs’ financial profile in 2016 from 2015, largely because of strong hedging support and manageable capital spending, despite lower power prices in Alberta.
…
DBRS believes the continued weak operating environment and the effect of Alberta Climate Leadership Plan (ACLP) combined will gradually weaken several primary business risk profile factors for the IPPs, including (a) hedging profile, particularly post-2020, as all long-term Alberta power purchase arrangements (PPAs) expire by 2020; (b) market position; and (c) market structure and environment. A weakening business risk profile will likely result in a one-notch downgrade to BBB (low) from BBB for the IPPs. A multi-notch downgrade below investment grade is unlikely in the foreseeable future, unless the implementation of the ACLP would materially affect the IPPs’ financial flexibility and profitability.
…
While TransAlta is less affected by the Alberta climate change strategy than Capital Power, the phase-out of all coal plants by 2030 and rising carbon compliance costs also have potential negative rating implications for TransAlta. Furthermore, TransAlta’s key credit metrics have remained relatively constrained for the current rating, which provides TransAlta with very limited financial flexibility. DBRS acknowledges that TransAlta has responded to the weak power pricing environment by cutting dividends and implementing cost-saving measures.

There are four issues affected by this trend change: TA.PR.D, TA.PR.F, TA.PR.H and TA.PR.J. The first of these, TA.PR.D, will reset at 2.709% on March 31.

I don’t often publish Implied Volatility Analysis for this series – so here it is:

Click for Big

Market Action

March 9, 2016

Today’s big news was the BoC announcement:

The Bank of Canada today announced that it is maintaining its target for the overnight rate at 1/2 per cent. The Bank Rate is correspondingly 3/4 per cent and the deposit rate is 1/4 per cent.

The global economy is progressing largely as the Bank anticipated in its January Monetary Policy Report (MPR). Financial market volatility, reflecting heightened concerns about economic momentum, appears to be abating. Although downside risks remain, the Bank still expects global growth to strengthen this year and next. Recent data indicate that the U.S. expansion remains broadly on track. At the same time, the low level of oil prices will continue to dampen growth in Canada and other energy-producing countries.

Prices of oil and other commodities have rebounded in recent weeks. In this context, and in light of shifting expectations for monetary policy in Canada and the United States, the Canadian dollar has appreciated from its recent lows. With these movements, both the price of oil and the exchange rate have averaged close to levels assumed in the January MPR.

Canada’s GDP growth in the fourth quarter was not as weak as expected, but the near-term outlook for the economy remains broadly the same as in January. National employment has held up despite job losses in resource-intensive regions, and household spending continues to underpin domestic demand. Non-energy exports are gathering momentum, particularly in sectors that are sensitive to exchange rate movements. However, overall business investment remains very weak due to retrenchment in the resource sector.

Inflation in Canada is evolving broadly as anticipated. The factors that pushed total CPI inflation up to 2 per cent will likely unwind in the months ahead. Measures of core inflation are at or just below 2 per cent, boosted by the temporary effects of past exchange rate depreciation. Material excess capacity in the Canadian economy will continue to dampen inflation.

An assessment of the impact of the upcoming federal budget’s fiscal measures will be incorporated into the Bank’s April projection. All things considered, the risks to the profile for inflation are roughly balanced. Meanwhile, financial vulnerabilities continue to edge higher, in part due to regional shifts in activity associated with the structural adjustment underway in Canada’s economy. The Bank’s Governing Council judges that the overall balance of risks remains within the zone for which the current stance of monetary policy is appropriate, and the target for the overnight rate remains at 1/2 per cent.

Meanwhile, there is a larger than usual international influence on Fed policy:

Investors are betting that the Fed will hold interest rates steady at its March 15-16 meeting as it assess the impact of a shaky global economy and jittery financial markets. A rise in the dollar triggered by easier policy from the ECB and perhaps the BOJ would support a go-slow strategy to raising rates in the U.S.

Asked how the U.S. central bank would respond if the ECB pushed rates further into negative territory, Fed Governor Lael Brainard told CNBC television on March 7 that she was focused on developments in the U.S. She quickly added though that the economy was being buffeted by “powerful cross currents” from abroad and that a further rise in the dollar would hit manufacturing-industry exports.
…
Fed Vice Chairman Stanley Fischer alluded to the central bank’s dollar dilemma when he spoke to the American Economic Association’s annual meeting in San Francisco on Jan. 3.

While policy makers in general recognize the benefits of floating currency rates in redistributing demand throughout the world economy, “they’re not so happy” when they’re the ones “giving up some growth, for instance, by having their exchange rate appreciate,” he said.

And New Zealand has cut its policy rate:

New Zealand’s central bank unexpectedly cut interest rates to a fresh record low and signaled further easing may be needed, saying it’s concerned by a slump in inflation expectations. The kiwi plunged by more than one U.S. cent.

Reserve Bank Governor Graeme Wheeler lowered the official cash rate by a quarter point to 2.25 percent, a move predicted by just two of 17 economists surveyed by Bloomberg. The remainder tipped no change. “Further policy easing may be required to ensure that future average inflation settles near the middle of the target range,” Wheeler said Thursday in Wellington.

Wheeler has resumed easing monetary policy as a stubbornly firm New Zealand dollar, weaker commodity prices and falling price expectations keep inflation beneath his 1-3 percent target. The central bank’s forecasts suggest one further reduction in borrowing costs this year to underpin economic growth and return inflation to its 2 percent target midpoint by early 2018.
…
The New Zealand dollar plunged after the statement, buying 66.58 U.S. cents at 9:38 a.m. in Wellington from 67.80 before the decision. The currency has climbed since late January, muting price pressures, and “a decline would be appropriate given the weakness in export prices,” Wheeler said today.

CalPers, the $284.56-billion dollar pension fund that doesn’t do its own credit analysis, has managed to shake down Moody’s:

Moody’s Investors Service Inc. agreed to pay $130 million to settle claims by the California Public Employee Retirement System over allegedly inflated ratings on residential-mortgage bond deals.

The largest U.S. state pension fund’s accord with Moody’s follows the February 2015 announcement that McGraw Hill Financial Inc.’s Standard & Poor’s would pay $125 million to settle claims by Calpers over grades on subprime mortgages during the run-up to the 2008 financial crisis.
…
McGraw Hill’s pact with Calpers was part of a $1.5 billion settlement to resolve similar allegations from the U.S. Justice Department and more than a dozen states.

Calpers sued the companies along with Fitch Ratings Ltd. in 2009 alleging it sustained losses of as much as $1 billion from “wildly inaccurate” risk assessments. Calpers said it put $1.3 billion into three investment vehicles backed by subprime mortgages in 2006 and 2007. The investments crumbled amid the housing crisis. The pension fund claimed the ratings companies helped fuel the investments and bent rules to give them the highest ratings to boost their profits from issuers, Calpers alleged.

They’d be better off checking their assumptions:

The economic assumptions include an assumed inflation assumption of 2.75 percent compounded annually. The inflation assumption is a component of assumed investment return, assumed wage growth, and assumed future post-retirement cost-of-living increases.

Based upon the asset allocation of the Public Employees’ Retirement Fund (PERF), the assumed investment return (net of administrative and investment expenses) is 7.5 percent per year, compounded annually.

On a positive note, the settlement will provide funds for senior management to give to their buddies, similarly to the scam discussed on April 23, 2012.

The Saudis are looking for a bank loan:

Saudi Arabia is seeking a bank loan of between $6-billion (U.S.) and $8-billion, sources familiar with the matter told Reuters, in what would be the first significant foreign borrowing by the kingdom’s government for over a decade.

Riyadh has asked lenders to submit proposals to extend it a five-year U.S. dollar loan of that size, with an option to increase it, the sources said, to help plug a record budget deficit caused by low oil prices.
…
The kingdom’s budget deficit reached nearly $100-billion last year. The government is currently bridging the gap by drawing down its massive store of foreign assets and issuing domestic bonds. But the assets will only last a few more years at their current rate of decline, while the bond issues have started to strain liquidity in the banking system.

Comic book fans and supporters of civil forfeiture will be pleased to learn that the Junior Justice League has another member:

The NHL ruled that an off-season rape allegation made against Patrick Kane was unfounded in determining that the Chicago Blackhawks star forward will not face any league disciplinary action.

The decision was issued on Wednesday, when the league issued a one-paragraph statement announcing it had completed its independent review of the allegations against Kane. The final step of the investigation occurred on Monday, when Kane met with NHL Commissioner Gary Bettman in New York.

Barry Critchley has enthusiastically endorsed the quixotic bid to get RON.PR.A taken out at par. I have updated the PrefBlog report on this week’s development.

It was a mixed day for the Canadian preferred share market, with PerpetualDiscounts gaining 2bp, FixedResets up 37bp and DeemedRetractibles off 26bp. The Performance Highlights table is lengthy, with numerous TRP and HSE issues at the top of the list. Volume was below average.

PerpetualDiscounts now yield 5.76%, equivalent to 7.49% interest at the standard equivalency factor of 1.3x. Long corporates now yield about 4.25%, so the pre-tax interest-equivalent spread (in this context, the “Seniority Spread”) is now about 325bp, equal to the spread reported on March 2.

Here’s TRP:

Click for Big

TRP.PR.E, which resets 2019-10-30 at +235, is bid at 17.30 to be $0.99 rich, while TRP.PR.C, resetting 2021-1-30 at +296, is $0.69 cheap at its bid price of 11.40.

Click for Big

Most expensive is MFC.PR.N, resetting at +230bp on 2020-3-19, bid at 17.50 to be 1.08 rich, while MFC.PR.G, resetting at +290bp on 2016-12-19, is bid at 17.55 to be 1.32 cheap.

Click for Big

The cheapest issue relative to its peers is BAM.PR.R, resetting at +230bp on 2016-6-30, bid at 13.77 to be $1.29 cheap. BAM.PF.E, resetting at +255 on 2020-3-31 is bid at 17.55 and appears to be $1.15 rich.

Click for Big

FTS.PR.K, with a spread of +205bp, and bid at 15.40 looks $0.53 expensive and resets 2019-3-1. FTS.PR.G, with a spread of +213bp and resetting 2018-9-1, is bid at 15.05 and is $0.24 cheap.

Click for Big

Investment-grade pairs predict an average three-month bill yield over the next five-odd years of -0.95%, with one outlier below -2.00%. There is one junk outlier above 0.00%.

Click for Big

Shall we just say that this exhibits a high level of confidence in the continued rapacity of Canadian banks?

HIMIPref™ Preferred Indices These values reflect the December 2008 revision of the HIMIPref™ Indices Values are provisional and are finalized monthly
Index	Mean Current Yield (at bid)	Median YTW	Median Average Trading Value	Median Mod Dur (YTW)	Issues	Day’s Perf.	Index Value
Ratchet	5.11 %	6.21 %	12,116	16.42	1	0.0000 %	1,534.4
FixedFloater	7.20 %	6.32 %	24,080	15.95	1	0.9946 %	2,762.4
Floater	4.52 %	4.71 %	73,033	15.94	4	0.8191 %	1,697.8
OpRet	0.00 %	0.00 %	0	0.00	0	0.0730 %	2,750.8
SplitShare	4.83 %	5.82 %	71,615	2.64	7	0.0730 %	3,219.0
Interest-Bearing	0.00 %	0.00 %	0	0.00	0	0.0730 %	2,511.6
Perpetual-Premium	5.81 %	-0.80 %	77,419	0.08	6	0.1259 %	2,539.1
Perpetual-Discount	5.71 %	5.76 %	98,605	14.20	33	0.0219 %	2,533.3
FixedReset	5.54 %	5.19 %	205,975	14.53	86	0.3709 %	1,834.8
Deemed-Retractible	5.32 %	5.54 %	115,745	5.12	34	-0.2631 %	2,558.4
FloatingReset	3.09 %	4.98 %	40,623	5.45	16	0.5651 %	1,981.0

Performance Highlights
Issue	Index	Change	Notes
TD.PF.D	FixedReset	-8.12 %	Completely nonsensical, as the issue traded 6,646 shares today in a range of 18.50-17 before closing at 17.32-19.30. VWAP was 18.87. Way to go with the $1.98 spreads there, guys! I have not checked whether this lamentable state of affairs is due to inadequate Toronto Stock Exchange reporting or inadequate Toronto Stock Exchange supervision of market-makers. YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-09 Maturity Price : 17.32 Evaluated at bid price : 17.32 Bid-YTW : 5.16 %
TRP.PR.E	FixedReset	-3.89 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-09 Maturity Price : 17.30 Evaluated at bid price : 17.30 Bid-YTW : 4.83 %
CIU.PR.C	FixedReset	-2.50 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-09 Maturity Price : 10.52 Evaluated at bid price : 10.52 Bid-YTW : 4.96 %
TRP.PR.B	FixedReset	-2.00 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-09 Maturity Price : 10.31 Evaluated at bid price : 10.31 Bid-YTW : 4.93 %
BAM.PF.F	FixedReset	-1.98 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-09 Maturity Price : 18.36 Evaluated at bid price : 18.36 Bid-YTW : 5.23 %
TRP.PR.D	FixedReset	-1.75 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-09 Maturity Price : 16.80 Evaluated at bid price : 16.80 Bid-YTW : 4.90 %
BNS.PR.L	Deemed-Retractible	-1.68 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 24.04 Bid-YTW : 5.39 %
BAM.PR.N	Perpetual-Discount	-1.50 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-09 Maturity Price : 19.75 Evaluated at bid price : 19.75 Bid-YTW : 6.14 %
BNS.PR.R	FixedReset	-1.40 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 22.55 Bid-YTW : 5.30 %
MFC.PR.F	FixedReset	-1.13 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 12.26 Bid-YTW : 11.43 %
BAM.PF.E	FixedReset	-1.13 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-09 Maturity Price : 17.55 Evaluated at bid price : 17.55 Bid-YTW : 5.12 %
GWO.PR.I	Deemed-Retractible	-1.07 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 20.40 Bid-YTW : 7.35 %
VNR.PR.A	FixedReset	1.02 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-09 Maturity Price : 16.84 Evaluated at bid price : 16.84 Bid-YTW : 5.44 %
MFC.PR.K	FixedReset	1.16 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 15.68 Bid-YTW : 9.57 %
RY.PR.Z	FixedReset	1.16 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-09 Maturity Price : 17.38 Evaluated at bid price : 17.38 Bid-YTW : 4.50 %
SLF.PR.I	FixedReset	1.17 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 17.30 Bid-YTW : 8.52 %
RY.PR.M	FixedReset	1.19 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-09 Maturity Price : 17.91 Evaluated at bid price : 17.91 Bid-YTW : 4.78 %
IFC.PR.C	FixedReset	1.23 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 16.40 Bid-YTW : 9.37 %
GWO.PR.O	FloatingReset	1.27 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 11.20 Bid-YTW : 12.00 %
TD.PF.A	FixedReset	1.31 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-09 Maturity Price : 17.02 Evaluated at bid price : 17.02 Bid-YTW : 4.67 %
FTS.PR.M	FixedReset	1.37 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-09 Maturity Price : 16.98 Evaluated at bid price : 16.98 Bid-YTW : 5.01 %
MFC.PR.J	FixedReset	1.47 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 17.25 Bid-YTW : 8.57 %
GWO.PR.N	FixedReset	1.48 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 13.07 Bid-YTW : 10.50 %
BNS.PR.Z	FixedReset	1.54 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 19.09 Bid-YTW : 7.10 %
BMO.PR.Q	FixedReset	1.56 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 18.28 Bid-YTW : 7.83 %
CM.PR.P	FixedReset	1.57 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-09 Maturity Price : 16.86 Evaluated at bid price : 16.86 Bid-YTW : 4.70 %
CM.PR.O	FixedReset	1.59 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-09 Maturity Price : 17.25 Evaluated at bid price : 17.25 Bid-YTW : 4.70 %
BAM.PR.X	FixedReset	1.62 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-09 Maturity Price : 13.16 Evaluated at bid price : 13.16 Bid-YTW : 5.19 %
BAM.PR.Z	FixedReset	1.67 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-09 Maturity Price : 17.70 Evaluated at bid price : 17.70 Bid-YTW : 5.47 %
TRP.PR.F	FloatingReset	1.72 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-09 Maturity Price : 11.85 Evaluated at bid price : 11.85 Bid-YTW : 4.98 %
FTS.PR.H	FixedReset	2.05 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-09 Maturity Price : 11.43 Evaluated at bid price : 11.43 Bid-YTW : 4.93 %
SLF.PR.J	FloatingReset	2.17 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 11.75 Bid-YTW : 11.52 %
PWF.PR.A	Floater	2.19 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-09 Maturity Price : 11.65 Evaluated at bid price : 11.65 Bid-YTW : 4.09 %
IAG.PR.G	FixedReset	2.25 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 18.20 Bid-YTW : 8.01 %
HSE.PR.C	FixedReset	2.28 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-09 Maturity Price : 15.70 Evaluated at bid price : 15.70 Bid-YTW : 6.52 %
RY.PR.J	FixedReset	2.39 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-09 Maturity Price : 18.44 Evaluated at bid price : 18.44 Bid-YTW : 4.76 %
BIP.PR.A	FixedReset	2.63 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-09 Maturity Price : 18.70 Evaluated at bid price : 18.70 Bid-YTW : 5.80 %
BAM.PR.R	FixedReset	2.76 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-09 Maturity Price : 14.15 Evaluated at bid price : 14.15 Bid-YTW : 5.51 %
TRP.PR.H	FloatingReset	2.78 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-09 Maturity Price : 9.25 Evaluated at bid price : 9.25 Bid-YTW : 4.64 %
TRP.PR.C	FixedReset	2.98 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-09 Maturity Price : 11.40 Evaluated at bid price : 11.40 Bid-YTW : 5.01 %
HSE.PR.G	FixedReset	3.15 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-09 Maturity Price : 17.69 Evaluated at bid price : 17.69 Bid-YTW : 6.25 %
TRP.PR.I	FloatingReset	3.71 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-09 Maturity Price : 10.90 Evaluated at bid price : 10.90 Bid-YTW : 4.59 %
HSE.PR.E	FixedReset	3.81 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-09 Maturity Price : 17.69 Evaluated at bid price : 17.69 Bid-YTW : 6.26 %
HSE.PR.A	FixedReset	4.44 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-09 Maturity Price : 9.40 Evaluated at bid price : 9.40 Bid-YTW : 6.65 %

Volume Highlights
Issue	Index	Shares Traded	Notes
RY.PR.R	FixedReset	255,385	Recent new issue. YTW SCENARIO Maturity Type : Call Maturity Date : 2021-08-24 Maturity Price : 25.00 Evaluated at bid price : 25.31 Bid-YTW : 5.28 %
RY.PR.H	FixedReset	60,655	RBC crossed 40,000 at 17.35. YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-09 Maturity Price : 17.25 Evaluated at bid price : 17.25 Bid-YTW : 4.59 %
RY.PR.Q	FixedReset	60,473	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-09 Maturity Price : 23.31 Evaluated at bid price : 25.53 Bid-YTW : 5.20 %
SLF.PR.E	Deemed-Retractible	60,419	Desjardins crossed 50,000 at 20.01. YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 20.00 Bid-YTW : 7.64 %
TD.PF.G	FixedReset	51,152	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-09 Maturity Price : 23.31 Evaluated at bid price : 25.49 Bid-YTW : 5.27 %
FTS.PR.J	Perpetual-Discount	46,730	Scotia crossed 20,600 at 21.22. CIBC bought 20,000 from TD at 21.45. YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-09 Maturity Price : 21.22 Evaluated at bid price : 21.22 Bid-YTW : 5.64 %
There were 26 other index-included issues trading in excess of 10,000 shares.

Wide Spread Highlights
Issue	Index	Quote Data and Yield Notes
TD.PF.D	FixedReset	Quote: 17.32 – 19.30 Spot Rate : 1.9800 Average : 1.1657 YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-09 Maturity Price : 17.32 Evaluated at bid price : 17.32 Bid-YTW : 5.16 %
BAM.PR.G	FixedFloater	Quote: 13.20 – 14.50 Spot Rate : 1.3000 Average : 0.8361 YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-09 Maturity Price : 25.00 Evaluated at bid price : 13.20 Bid-YTW : 6.32 %
TRP.PR.E	FixedReset	Quote: 17.30 – 18.40 Spot Rate : 1.1000 Average : 0.6668 YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-09 Maturity Price : 17.30 Evaluated at bid price : 17.30 Bid-YTW : 4.83 %
MFC.PR.L	FixedReset	Quote: 16.32 – 17.27 Spot Rate : 0.9500 Average : 0.6609 YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 16.32 Bid-YTW : 9.12 %
TRP.PR.B	FixedReset	Quote: 10.31 – 10.95 Spot Rate : 0.6400 Average : 0.4377 YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-09 Maturity Price : 10.31 Evaluated at bid price : 10.31 Bid-YTW : 4.93 %
PVS.PR.D	SplitShare	Quote: 22.71 – 23.24 Spot Rate : 0.5300 Average : 0.3465 YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2021-10-08 Maturity Price : 25.00 Evaluated at bid price : 22.71 Bid-YTW : 6.52 %

Market Action

March 8, 2016

Assiduous Readers will remember covered bonds – issues that are guaranteed both by the issuing bank and by a mortgage pool. This results in high ratings – for instance Royal Bank’s covered bonds are rated AAA by DBRS. So … having sovereign-style credit ratings leads to sovereign-style prices:

The first non-government issuer just got paid to borrow in euros.

Berlin Hyp AG sold 500 million euros ($550 million) of three-year covered bonds priced to yield minus 0.162 percent on Tuesday, according to data compiled by Bloomberg. The sale followed the euro area’s first zero-coupon covered bond, sold last month by another German issuer, Landesbank Hessen-Thueringen Girozentrale.
…
In the secondary market, almost 70 percent of German covered bonds have yields of less than zero, according to HSBC data tracking issues of at least 500 million euros. Issuers have extended maturities in the last month to avoid selling bonds with negative yields, said Matthias Melms, an analyst at NordLB.

“There seems too little concern that the market has become more and more distorted or even impaired,” said Bernd Volk, head of European covered and agency bond research at Deutsche Bank AG.

Berlin Hyp is majority-owned by Germany’s savings banks, which are supported by the nation’s states and municipalities.

Assiduous Reader AP writes in with a link to a piece about robot (and drone!) law:

OK, let’s say there’s no hack, but a self-driving car still crashes. What’s the driver’s responsibility?

On the self-driving cars that are being tested right now, the carmakers want the driver paying attention—and right now, they’re not doing it. They’re playing cards. That’s a little scary. And even if driver is well-intentioned, sitting there alert, it’s hard to stay alert for a long drive if you have nothing to do. This is the problem of “unintentional inattention,” and it goes well beyond cars.

Imagine you’ve got robot mall cops. There’s eight of them running around the mall and one guy in a room someplace looking at eight TV screens. He’s bored out of his mind, falling asleep. Then something happens, and it’s his fault because he’s asleep at the switch. Sometimes this is called the “human in the loop” problem. Autonomy seems dangerous, so you put a human in the loop. But that person’s job is very passive. It’s tough to do, and it may be a low-wage, low-status job. Then you blame the person who fails to monitor, even though the system sets them up for the fall. That’s not a good design, but I don’t know what the answer is.

It was a poor day for the Canadian preferred share market, with PerpetualDiscounts off 25bp, FixedResets losing 101bp and DeemedRetractibles down 80b. The Performance Highlights table is predictably lengthy. Volume was well above average.

Here’s TRP:

Click for Big

TRP.PR.E, which resets 2019-10-30 at +235, is bid at 18.00 to be $1.54 rich, while TRP.PR.C, resetting 2021-1-30 at +296, is $1.11 cheap at its bid price of 11.07.

Click for Big

Most expensive is MFC.PR.N, resetting at +230bp on 2020-3-19, bid at 17.50 to be 1.14 rich, while MFC.PR.G, resetting at +290bp on 2016-12-19, is bid at 17.49 to be 1.33 cheap.

Click for Big

The cheapest issue relative to its peers is BAM.PR.R, resetting at +230bp on 2016-6-30, bid at 13.77 to be $1.29 cheap. BAM.PF.E, resetting at +255 on 2020-3-31 is bid at 17.75 and appears to be $1.41 rich.

Click for Big

FTS.PR.K, with a spread of +205bp, and bid at 15.32 looks $0.58 expensive and resets 2019-3-1. FTS.PR.H, with a spread of +145bp and resetting 2020-6-1, is bid at 11.20 and is $0.31 cheap.

Click for Big

Investment-grade pairs predict an average three-month bill yield over the next five-odd years of -1.02%, with one outlier below -2.00% and two above 0.00%. There are no junk outliers.

Click for Big

Shall we just say that this exhibits a high level of confidence in the continued rapacity of Canadian banks?

HIMIPref™ Preferred Indices These values reflect the December 2008 revision of the HIMIPref™ Indices Values are provisional and are finalized monthly
Index	Mean Current Yield (at bid)	Median YTW	Median Average Trading Value	Median Mod Dur (YTW)	Issues	Day’s Perf.	Index Value
Ratchet	5.11 %	6.21 %	12,617	16.42	1	2.9526 %	1,534.4
FixedFloater	7.27 %	6.38 %	24,247	15.88	1	2.1094 %	2,735.2
Floater	4.55 %	4.75 %	74,148	15.86	4	-1.2372 %	1,684.0
OpRet	0.00 %	0.00 %	0	0.00	0	0.0471 %	2,748.8
SplitShare	4.84 %	5.73 %	73,249	2.64	7	0.0471 %	3,216.6
Interest-Bearing	0.00 %	0.00 %	0	0.00	0	0.0471 %	2,509.7
Perpetual-Premium	5.82 %	0.80 %	75,293	0.08	6	-0.1521 %	2,535.9
Perpetual-Discount	5.71 %	5.78 %	100,198	14.13	33	-0.2542 %	2,532.8
FixedReset	5.56 %	5.10 %	208,689	14.46	86	-1.0052 %	1,828.0
Deemed-Retractible	5.30 %	5.60 %	115,808	5.13	34	-0.8018 %	2,565.1
FloatingReset	3.11 %	4.89 %	40,945	5.46	16	-0.9745 %	1,969.8

Performance Highlights
Issue	Index	Change	Notes
BAM.PR.Z	FixedReset	-5.64 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 17.41 Evaluated at bid price : 17.41 Bid-YTW : 5.57 %
FTS.PR.G	FixedReset	-4.76 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 15.02 Evaluated at bid price : 15.02 Bid-YTW : 5.00 %
FTS.PR.H	FixedReset	-4.68 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 11.20 Evaluated at bid price : 11.20 Bid-YTW : 5.04 %
TRP.PR.I	FloatingReset	-4.45 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 10.51 Evaluated at bid price : 10.51 Bid-YTW : 4.76 %
BAM.PR.R	FixedReset	-4.38 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 13.77 Evaluated at bid price : 13.77 Bid-YTW : 5.66 %
TRP.PR.H	FloatingReset	-4.26 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 9.00 Evaluated at bid price : 9.00 Bid-YTW : 4.77 %
HSE.PR.A	FixedReset	-3.74 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 9.00 Evaluated at bid price : 9.00 Bid-YTW : 6.95 %
BAM.PR.X	FixedReset	-3.72 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 12.95 Evaluated at bid price : 12.95 Bid-YTW : 5.27 %
CU.PR.C	FixedReset	-3.63 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 15.95 Evaluated at bid price : 15.95 Bid-YTW : 5.00 %
HSE.PR.E	FixedReset	-3.18 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 17.04 Evaluated at bid price : 17.04 Bid-YTW : 6.51 %
TRP.PR.B	FixedReset	-3.04 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 10.52 Evaluated at bid price : 10.52 Bid-YTW : 4.83 %
TD.PF.A	FixedReset	-2.89 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 16.80 Evaluated at bid price : 16.80 Bid-YTW : 4.73 %
NA.PR.W	FixedReset	-2.70 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 15.86 Evaluated at bid price : 15.86 Bid-YTW : 5.04 %
VNR.PR.A	FixedReset	-2.69 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 16.67 Evaluated at bid price : 16.67 Bid-YTW : 5.49 %
MFC.PR.J	FixedReset	-2.58 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 17.00 Bid-YTW : 8.78 %
HSE.PR.C	FixedReset	-2.54 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 15.35 Evaluated at bid price : 15.35 Bid-YTW : 6.68 %
BMO.PR.Q	FixedReset	-2.44 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 18.00 Bid-YTW : 8.12 %
RY.PR.J	FixedReset	-2.38 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 18.01 Evaluated at bid price : 18.01 Bid-YTW : 4.88 %
BNS.PR.B	FloatingReset	-2.24 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 20.50 Bid-YTW : 5.76 %
FTS.PR.K	FixedReset	-2.23 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 15.32 Evaluated at bid price : 15.32 Bid-YTW : 4.87 %
TRP.PR.C	FixedReset	-2.21 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 11.07 Evaluated at bid price : 11.07 Bid-YTW : 5.16 %
TRP.PR.G	FixedReset	-2.13 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 18.40 Evaluated at bid price : 18.40 Bid-YTW : 5.07 %
PWF.PR.A	Floater	-2.06 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 11.40 Evaluated at bid price : 11.40 Bid-YTW : 4.18 %
BMO.PR.T	FixedReset	-2.03 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 16.91 Evaluated at bid price : 16.91 Bid-YTW : 4.66 %
MFC.PR.B	Deemed-Retractible	-1.96 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 20.56 Bid-YTW : 7.43 %
RY.PR.H	FixedReset	-1.89 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 17.11 Evaluated at bid price : 17.11 Bid-YTW : 4.63 %
SLF.PR.A	Deemed-Retractible	-1.89 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 21.27 Bid-YTW : 7.03 %
RY.PR.M	FixedReset	-1.88 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 17.70 Evaluated at bid price : 17.70 Bid-YTW : 4.84 %
NA.PR.S	FixedReset	-1.86 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 16.90 Evaluated at bid price : 16.90 Bid-YTW : 4.91 %
MFC.PR.C	Deemed-Retractible	-1.86 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 20.07 Bid-YTW : 7.61 %
TRP.PR.D	FixedReset	-1.84 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 17.10 Evaluated at bid price : 17.10 Bid-YTW : 4.81 %
PWF.PR.P	FixedReset	-1.80 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 11.98 Evaluated at bid price : 11.98 Bid-YTW : 4.88 %
BNS.PR.Z	FixedReset	-1.78 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 18.80 Bid-YTW : 7.39 %
MFC.PR.K	FixedReset	-1.77 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 15.50 Bid-YTW : 9.73 %
SLF.PR.C	Deemed-Retractible	-1.76 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 20.07 Bid-YTW : 7.53 %
TRP.PR.F	FloatingReset	-1.69 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 11.65 Evaluated at bid price : 11.65 Bid-YTW : 5.06 %
SLF.PR.E	Deemed-Retractible	-1.67 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 20.05 Bid-YTW : 7.60 %
BAM.PF.A	FixedReset	-1.66 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 17.75 Evaluated at bid price : 17.75 Bid-YTW : 5.38 %
SLF.PR.B	Deemed-Retractible	-1.60 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 21.54 Bid-YTW : 6.90 %
SLF.PR.D	Deemed-Retractible	-1.57 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 20.01 Bid-YTW : 7.57 %
BNS.PR.F	FloatingReset	-1.57 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 18.17 Bid-YTW : 7.68 %
MFC.PR.N	FixedReset	-1.46 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 17.50 Bid-YTW : 8.27 %
BMO.PR.S	FixedReset	-1.44 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 17.09 Evaluated at bid price : 17.09 Bid-YTW : 4.73 %
HSE.PR.G	FixedReset	-1.44 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 17.15 Evaluated at bid price : 17.15 Bid-YTW : 6.46 %
FTS.PR.M	FixedReset	-1.41 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 16.75 Evaluated at bid price : 16.75 Bid-YTW : 5.08 %
CM.PR.O	FixedReset	-1.39 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 16.98 Evaluated at bid price : 16.98 Bid-YTW : 4.78 %
BNS.PR.C	FloatingReset	-1.36 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 20.98 Bid-YTW : 5.53 %
FTS.PR.J	Perpetual-Discount	-1.35 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 21.16 Evaluated at bid price : 21.16 Bid-YTW : 5.66 %
GWO.PR.R	Deemed-Retractible	-1.34 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 21.32 Bid-YTW : 7.05 %
CM.PR.P	FixedReset	-1.31 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 16.60 Evaluated at bid price : 16.60 Bid-YTW : 4.78 %
PWF.PR.L	Perpetual-Discount	-1.29 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 21.95 Evaluated at bid price : 22.19 Bid-YTW : 5.81 %
SLF.PR.J	FloatingReset	-1.29 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 11.50 Bid-YTW : 11.81 %
MFC.PR.M	FixedReset	-1.29 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 17.65 Bid-YTW : 8.22 %
RY.PR.Z	FixedReset	-1.26 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 17.18 Evaluated at bid price : 17.18 Bid-YTW : 4.55 %
GWO.PR.O	FloatingReset	-1.25 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 11.06 Bid-YTW : 12.16 %
GWO.PR.P	Deemed-Retractible	-1.25 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 23.73 Bid-YTW : 6.14 %
BIP.PR.A	FixedReset	-1.25 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 18.22 Evaluated at bid price : 18.22 Bid-YTW : 5.96 %
RY.PR.W	Perpetual-Discount	-1.25 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 22.71 Evaluated at bid price : 23.00 Bid-YTW : 5.36 %
IFC.PR.C	FixedReset	-1.22 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 16.20 Bid-YTW : 9.55 %
TRP.PR.E	FixedReset	-1.21 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 18.00 Evaluated at bid price : 18.00 Bid-YTW : 4.63 %
GWO.PR.H	Deemed-Retractible	-1.20 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 21.49 Bid-YTW : 6.99 %
MFC.PR.H	FixedReset	-1.19 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 19.15 Bid-YTW : 7.62 %
MFC.PR.G	FixedReset	-1.19 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 17.49 Bid-YTW : 8.60 %
BAM.PR.K	Floater	-1.18 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 10.01 Evaluated at bid price : 10.01 Bid-YTW : 4.79 %
FTS.PR.F	Perpetual-Discount	-1.13 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 21.65 Evaluated at bid price : 21.90 Bid-YTW : 5.62 %
BMO.PR.W	FixedReset	-1.06 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 16.81 Evaluated at bid price : 16.81 Bid-YTW : 4.65 %
BNS.PR.Y	FixedReset	-1.05 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 18.81 Bid-YTW : 7.05 %
BAM.PR.T	FixedReset	-1.01 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 14.75 Evaluated at bid price : 14.75 Bid-YTW : 5.39 %
BMO.PR.M	FixedReset	1.16 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 23.50 Bid-YTW : 3.99 %
CIU.PR.A	Perpetual-Discount	1.34 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 20.38 Evaluated at bid price : 20.38 Bid-YTW : 5.69 %
TD.PR.Y	FixedReset	1.36 %	YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 23.80 Bid-YTW : 3.94 %
TD.PF.C	FixedReset	1.74 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 16.91 Evaluated at bid price : 16.91 Bid-YTW : 4.68 %
TD.PF.E	FixedReset	2.11 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 19.40 Evaluated at bid price : 19.40 Bid-YTW : 4.71 %
BAM.PR.G	FixedFloater	2.11 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 25.00 Evaluated at bid price : 13.07 Bid-YTW : 6.38 %
BAM.PR.E	Ratchet	2.95 %	YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 25.00 Evaluated at bid price : 13.25 Bid-YTW : 6.21 %

Volume Highlights
Issue	Index	Shares Traded	Notes
RY.PR.R	FixedReset	451,304	Recent new issue. YTW SCENARIO Maturity Type : Call Maturity Date : 2021-08-24 Maturity Price : 25.00 Evaluated at bid price : 25.22 Bid-YTW : 5.35 %
TD.PF.A	FixedReset	131,588	RBC crossed 10,000 at 17.15. Desjardins crossed blocks of 16,800 and 100,000 at the same price. YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 16.80 Evaluated at bid price : 16.80 Bid-YTW : 4.73 %
RY.PR.Q	FixedReset	120,522	TD crossed two blocks of 39,000 each, both at 25.50. YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 23.29 Evaluated at bid price : 25.45 Bid-YTW : 5.21 %
NA.PR.S	FixedReset	120,516	Nesbitt crossed blocks of 50,000 and 61,600, both at 17.00. YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 16.90 Evaluated at bid price : 16.90 Bid-YTW : 4.91 %
CU.PR.I	FixedReset	67,932	RBC crossed 50,000 at 25.20. YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 23.23 Evaluated at bid price : 25.15 Bid-YTW : 4.38 %
TD.PF.G	FixedReset	64,167	TD crossed 39,000 at 25.50. YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 23.30 Evaluated at bid price : 25.46 Bid-YTW : 5.28 %
There were 45 other index-included issues trading in excess of 10,000 shares.

Wide Spread Highlights
Issue	Index	Quote Data and Yield Notes
TD.PR.T	FloatingReset	Quote: 21.36 – 22.22 Spot Rate : 0.8600 Average : 0.5746 YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 21.36 Bid-YTW : 4.89 %
TRP.PR.H	FloatingReset	Quote: 9.00 – 9.74 Spot Rate : 0.7400 Average : 0.4833 YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 9.00 Evaluated at bid price : 9.00 Bid-YTW : 4.77 %
TD.PF.A	FixedReset	Quote: 16.80 – 17.39 Spot Rate : 0.5900 Average : 0.3668 YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 16.80 Evaluated at bid price : 16.80 Bid-YTW : 4.73 %
BAM.PR.Z	FixedReset	Quote: 17.41 – 17.99 Spot Rate : 0.5800 Average : 0.3890 YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 17.41 Evaluated at bid price : 17.41 Bid-YTW : 5.57 %
GWO.PR.O	FloatingReset	Quote: 11.06 – 12.00 Spot Rate : 0.9400 Average : 0.7574 YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 11.06 Bid-YTW : 12.16 %
FTS.PR.M	FixedReset	Quote: 16.75 – 17.30 Spot Rate : 0.5500 Average : 0.3753 YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2046-03-08 Maturity Price : 16.75 Evaluated at bid price : 16.75 Bid-YTW : 5.08 %

New Issues

New Issue: LB FixedReset, 5.85%+513, NVCC

Laurentian Bank of Canada has announced:

that it has entered into an agreement with a syndicate of underwriters led by BMO Capital Markets, TD Securities Inc. and RBC Capital Markets (collectively, the “Underwriters”), under which the Underwriters have agreed to buy on a bought deal basis an aggregate of 4 million Non-Cumulative Class A Preferred Shares, Series 15 (Non-Viability Contingent Capital (NVCC)) (the “Preferred Shares Series 15”), at a price of $25.00 per Preferred Share Series 15 for gross proceeds of $100 million (the “Offering”). Laurentian has granted to the Underwriters an option to purchase up to an additional 2 million Preferred Shares Series 15 exercisable at any time up to 48 hours before closing. Should the option be fully exercised, the total gross proceeds of the Preferred Shares Series 15 offering will be $150 million. The Preferred Shares Series 15 will be offered for sale to the public in each of the provinces of Canada pursuant to a prospectus supplement to Laurentian’s short form base shelf prospectus dated November 10, 2014, which supplement will be filed with Canadian securities regulatory authorities in all Canadian provinces.

Holders of Preferred Shares Series 15 will be entitled to receive non-cumulative preferential fixed quarterly dividends for the initial period ending on, but excluding, June 15, 2021, as and when declared by the board of directors of the Bank, payable in the amount of $1.4625 per Preferred Share Series 15, to yield 5.85 per cent annually.

Thereafter, the dividend rate will reset every five years to be equal to the 5-Year Government of Canada Bond Yield plus 5.13 per cent. Subject to certain conditions, holders may elect to convert any or all of their Preferred Shares Series 15 into an equal number of Non-Cumulative Class A Preferred Shares, Series 16 (Non-Viability Contingent Capital (NVCC)) (the “Preferred Shares Series 16”) on June 15, 2021 and on June 15 every five years thereafter. Holders of the Preferred Shares Series 16 will be entitled to receive non-cumulative preferential floating rate quarterly dividends, as and when declared by the board of directors of the Bank, equal to the then 3-month Government of Canada Treasury Bill yield plus 5.13 per cent. The Offering is expected to close on or about March 17, 2016 and is subject to Laurentian receiving all necessary regulatory approvals.

The net proceeds of the Offering will be added to Laurentian’s general funds and will be used for general corporate purposes.

Laurentian has one other NVCC-compliant FixedReset outstanding, LB.PR.H, 4.30%+255, resetting 2019-6-15, bid at 16.15 to yield 5.38% to perpetuity. The new issue yields 5.78% (assuming an end-price of 23.14) so the new issue offers a yield pick-up of 40bp for a spread increase of 258bp; this is more or less in line with other series of issues.

Issue Comments

RON.PR.A Grumblers Get An Ally

The Stirling Funds has issued an Open Letter to Lowes (LOW: NYSE) and to Rona (RON: TSX) – Lowes Bid Undervalues Rona Preferred Shares (RON.PR.A: TSX):

Lowes, a FORTUNE 50 US based multinational company with sales of over $56 billion, has come to Canada to TAKEOVER, TAKE PRIVATE, CHANGE CONTROL of Rona Inc. Why are these descriptions important? Because they mean that certain things happen: common shareholders get a “Take-Over” premium for their shares and directors and officers get paid handsomely (> $40 million) by accelerating payments that would otherwise take many years for them to receive, if at all.

Let’s consider fundamental principles of Canadian and Quebec corporate law. If Rona’s common shares are collectively worth $2.6 billion, than any higher ranking financial instrument is worth at minimum its face or par value. But that is not how the transaction has been structured and as a result retail preferred shareholders will be FORCED to accept $5 per share less than its face or par value of $25. This is OPPRESSIVE.

Moreover, the Rona Board of Directors owe a fiduciary duty of care to all stakeholders. They have addressed the common shareholders’ interests with a > 100% premium, debenture holders which stand to gain better ratings for their interests, and employees by undertaking to maintain employment, but they have failed in their fiduciary duty to preferred shareholders.

In a similar situation in Canada, RioCan REIT preferred shares with almost identical terms as the Rona preferred shares and also with a March 31, 2016 maturity are being redeemed at their par value of $25.

The Caisse de dépôt et placement du Québec, one of Canada’s pre-eminent pension fund managers, supports the deal seemingly knowing that the preferred shares are held principally by Quebec retail investors and Quebec pensioners, the very people the Caisse represents.

Recently, a Quebec-based retail investor who owns Rona preferred shares wrote to the company:

“I feel the Rona board in unanimously recommending the Lowes take-over has failed to act fairly and equitably in the interests of all stake holders and has only acted in the interest of common shareholders”… “Do not short change the small retail investor”.

As background, the Stirling Funds owns Rona preferred shares. We also own Lowes common shares and are supportive of Lowes’ strategic entry into Canada, and its takeover offer of Rona. We believe Lowes has 1) a strong, focused and highly competent management team; 2) are well positioned in their market segments; and 3) will prosper significantly as the economy continues to recover and the housing and renovation cycle normalises. We are not hostile to Lowes (in fact the opposite). Our issue lies in the deal structure. It would seem bad business for Lowes to “short-change” the very group of investors it hopes to win as customers to save a rounding error on a $2.7 billion purchase.

NEXT STEPS

To further support our efforts to seek fair remedies for the Rona preferred shareholders, the Stirling Funds has retained European-based ÖstVäst Advisory, a specialist advisor to global institutions in complex financial and security law matters.

“It is unclear why Lowes would uniquely diminish the value of the Rona preferred shareholders, while handsomely rewarding everyone else” stated Fredrik Skoglund, Partner & Head of Research of ÖstVäst Advisors. “I would assume the Quebec Securities Commission would not wish to establish precedents like this”.

PROFILES:

The Stirling Funds are value-focused investment funds based in London, England that hold a portfolio of diversified global securities principally in asset-rich companies trading at a discount to their underlying intrinsic value.

ÖstVäst Advisory, based in Stockholm Sweden is an independent, specialist global advisory firm providing client tailored financial, investment and corporate services.

SOURCE The Stirling Funds

For further information: ÖstVäst Advisory AB, Stockholm, Sweden, Fredrik Skoglund, Partner / Head of Research, +46 70 410 5165, info@ostvast.com; The Stirling Funds, London, England, Gordon Flatt, Chief Investment Officer, +44 3239 9932, info@stirling-funds.co.uk

I have not been able to find any information on the so-called Stirling Funds. Their website has been set up simply for use as a mail-drop. They’re not entirely a joke because last October they issued an Early Warning Report:

Yesterday Stirling purchased sufficient shares of Kicking Horse Energy Inc. (KCK: TSX-V) in the market on the Venture Exchange to increase its ownership to hold 7,630,000 Common Shares representing 12% issued equity.

Kicking Horse was promptly taken over at 4.75 per share, so – assuming Stirling Funds has other investments – there is some heft to the management company.

Gordon Flatt, CIO of Stirling, has made the news before in connection with Inco’s preferred shares:

A $40-million (U.S.) investment in Inco Ltd. has intensified speculation that the Canadian nickel producer is a potential takeover target.

The purchase makes Winnipeg’s Coastal Investment Inc. – run by Gordon Flatt, brother of Brascan’s Bruce Flatt – the single-biggest owner of Inco’s series E preferred shares, the market’s largest preferred issue. Coastal now owns 1.12 million shares, or 12 per cent.

In turn, we can find reference to Coastal Value Fund with respect to their redemption of CVF.PR.A in 2007 and DIV.PR.A later in that year. Bloomberg has a note:

As of February 21, 2007, Coastal Value Fund Inc has gone out of business. Coastal Value Fund Inc. is an equity mutual fund launched and managed by Coastal Corp. The fund invests in the public equity markets of Canada. It invests in the stocks of companies operating across diversified sectors. The fund primarily invests in value stocks of large cap companies. Coastal Value Fund Inc was formed on September 27, 2002 and is domiciled in Canada.

And this eventually leads to a Bloomberg data dump regarding Gordon Flatt – he’s got his thumbs in a lot of pies, although it is not immediately apparent how substantial any of them are.

I have sent an eMail to the indicated address:

Dear Mr. Flatt,

I read your press release with interest and will be reporting on it at http://www.prefblog.com later today.

Please tell me a little more about yourself and your firm. Does Stirling Funds have a functional website? What are the AUM and where may I find your historical performance numbers? Ar e you the same Gordon Flatt who has been involved with Copacabana Capital Ltd. and Coastal Value Fund Inc.?

Sincerely,

No answer yet, but it’s still early.

Anyway, Assiduous Readers will remember that my post regarding the proposed RON.PR.A arrangement sparked a fair amount of comment – by PrefBlog standards – with several commenters expressing horror at the idea of a preferred share being taken out below par and heaping me with opprobrium for suggesting it was a pretty good deal for holders.

I based that opinion on a comparison with similar issues, so I’ll take the opportunity to update prices for that list:

Ticker	Issue Reset Spread	Bid 2016-2-3	Bid 2016-3-8
MFC.PR.J	+261	17.89	17.00
RY.PR.M	262	18.45	17.70
TD.PF.D	279	19.00	18.85
SLF.PR.I	273	17.45	17.10
BAM.PF.B	263	16.46	16.88
BMO.PR.Y	271	19.35	18.56

So, given that Lowe’s is offering $20.00 for RON.PR.A with its spread of +265, it would appear that so far a good deal has simply gotten better since the announcement date. But it’s still too early to make a decision … the meeting is not until March 31 and if the preferred share market should happen to go up 10% between now and the last minute to vote … well, then, circumstances alter cases, don’t they?

Update, 2016-3-9: Barry Critchley has taken up the story:

The battle for the support of Rona’s preferred shareholders — who in the takeover by Lowe’s are being offered $20 per share, a $5 discount to the original purchase price — is set to get a little more interesting three weeks before all parties gather in Montreal to approve the transaction.

This week, and possibly as early as Thursday, more information is expected to be released about the extent of the opposition to the terms offered to the pref shareholders. “We have had lots of emails and calls from retail investors about the situation and we will be responding,” said an adviser with knowledge of what’s being planned.
…
Maybe the circumstances are different but there is a precedent that doesn’t look too good for Lowe’s. In early 1987, Australia’s Fosters Brewing acquired Carling O’Keefe. For some reason, it decided not to acquire the preferred shares that had been issued by Carling. Led by a brewery analyst Mike Palmer and with heavy lifting from Sheila Block of Torys, an action was brought based on improper treatment of Carling’s preferred-shareholders. In time the courts in Ontario found the conduct of the directors of the amalgamated corporation to be “oppressive” to the preference shareholders. After that ruling the pref shareholders got their proper reward.

I’ve looked it up and, while ready to be corrected, suggest that the Carling-Fosters case is irrelevant:

In Palmer v. Carling O’Keefe, Carling O’Keefe amalgamated with a company established by Elders to acquire Carling O’Keefe. The Court was asked to consider the impact of the amalgamation on the holders of the preference shares of Carling O’Keefe. The object of amalgamating the two companies was to move the debt incurred to make the acquisition into Carling O’Keefe. In order to protect the interests of the preference shareholders, sufficient funds to redeem the preference shares were set aside in a separate trust account. The Court decided that the transaction had no business purpose for Carling O’Keefe. It concluded that the transaction served the interests of the controlling shareholder and was unfairly prejudicial to, and unfairly disregarded the interests of, the preference shareholders and that the directors of Carling O’Keefe had breached their duty to act for the benefit of the corporation as a whole. The oppression remedy is discussed in greater detail in Section 7 of this part of the chapter.
…
In Palmer v. Carling O’Keefe, discussed above, the Court found that there was no bad faith involved in the decision to amalgamate the two companies, and that the board, composed of experienced business people acting upon independent advice, had exercised its best business judgment with respect to the transaction. The Court concluded that the impugned conduct nevertheless constituted oppression because it was unfairly prejudicial to the interests of the holders of preference shares and because it only served the interests of the controlling shareholder and not the interests of the corporation.

It seems to me that this precedent explains why the BCE preferred shares were to be redeemed in the BCE-Teachers’ deal, since in that case BCE was to be loaded up with LBO debt (see Responding to an Amalgamation Squeeze-out under the OBCA); but it doesn’t seem applicable here.

Issue Comments

PVS.PR.A To Be Redeemed

Partners Value Split Corp. has announced:

its intention to redeem all of its outstanding Class AA Preferred Shares, Series 1 (the “Series 1 Preferred Shares”) (TSX: PVS.PR.A) for cash on March 28, 2016 (the “Redemption Date”). The redemption price per Series 1 Preferred Share will be equal to C$25.00 plus accrued and unpaid dividends of C$0.091541 thereon to March 28, 2016, representing a total redemption price of C$25.091541 per Series 1 Preferred Share (the “Redemption Price”). Formal notice will be delivered to holders of Series 1 Preferred Shares in accordance with the terms of the Series 1 Preferred Shares.

From and after the Redemption Date the Series 1 Preferred Shares will cease to be entitled to dividends or any other participation in any distribution of the assets of the Company and the holders thereof shall not be entitled to exercise any of their other rights as shareholders in respect thereof except to receive the Redemption Price (less any tax required to be deducted and withheld by the Company). After the redemption of the Series 1 Preferred Shares, the Company will consolidate the existing capital shares held by Partners Value Investments Inc. so that there are an equal number of preferred shares and capital shares outstanding.

It will be recalled that this redemption was funded well in advance by the issue of PVS.PR.E – part funds from this issuance were used to pay a dividend to the capital unitholder.

PrefBlog

L.PR.B Trend Positive, Says DBRS

SJR.PR.A Downgraded To Pfd-3(low) By DBRS

New Issue: CWB FixedReset, 6.25%+547, NVCC

March 10, 2016

TA: Trend Changed To Negative By DBRS

March 9, 2016

March 8, 2016

New Issue: LB FixedReset, 5.85%+513, NVCC

RON.PR.A Grumblers Get An Ally

PVS.PR.A To Be Redeemed

Archives

Of Interest