It would appear that it is the banks who shave the Spanish barber:
Bankia group risks dragging the rest of Spain into its vortex
As Spain’s third-biggest bank asks Prime Minister Mariano Rajoy’s government for 19 billion euros ($24 billion), international investors are tallying the potential cost for the rest of the industry and betting he won’t be able to foot the bill. With foreign investors shunning Spanish debt, leaving national banks to fund the government, the nation’s 10-year borrowing costs compared with Germany’s are near a record.
Spain needs to bail out lenders still reeling from the collapse of the real-estate boom while its own access to funding increasingly depends on domestic banks being kept afloat by the European Central Bank’s refinancing operations. Rising borrowing costs are putting pressure on Rajoy’s five month-old government to join Greece, Portugal and Ireland in seeking a rescue that would be the European Union’s biggest.
There’s capital flight in Spain:
More than €97-billion in capital fled Spain in the first quarter of the year as the country’s crisis escalated along with the troubles of the euro zone.
That stunning number, published today by the country’s central bank and reported in The Financial Times, represents almost 10 per cent of Spain’s gross domestic product.
I recall William Shirer stressed capital flight as a destabilizing factor of the French Third Republic. But that’s just panic.
There is NO PANIC. Let me repeat that: there is NO PANIC! There is absolutely NO PANIC anywhere and anybody who might panic will be shot, not that anybody would panic:
The International Monetary Fund said it is not preparing financial aid for Spain and the country denied any talks about a bailout even as its borrowing costs approach euro-era records.
“There’s been no request for financial assistance from Spain and the IMF is not making plans for financial assistance to Spain,” Gerry Rice, the IMF’s director of external relations, told reporters in Washington today.
Hate your neighbors? Want to take revenge for that time their cat peed on your lawn? The good folks of the federal government are offering a new way to denounce your neighbors!
The Copyright Board of Canada has, for the first time, decided to charge fees to anyone who uses recorded music as part of a public event. That means anyone who plans on using tunes to get the party started will need to dig a little deeper before hitting play on the iPod.
The new rules include any event in which music is played – weddings, ice shows, street parties, circuses, parades and karaoke bars are all named in the official notice from the country’s copyright board.
…
Re:Sound does employ inspectors, but would only undertake an inspection if complaints were received.
Denounce your neighbor today and help to bring back Stalinism!
S&P affirmed CSE.PR.A:
- We are affirming our ratings, including our ‘BB+’ long-term corporate credit rating, on Capstone Infrastructure Corp.
- In addition, we are removing the ratings from CreditWatch with developing implications.
- The affirmation and CreditWatch removal reflects our view of the progress that the company has made in regard to the various initiatives to address its liquidity.
- The stable outlook reflects our view that Capstone benefits from contracted revenue and insulation from electricity demand and price risks
provided by power purchase agreements with investment-grade off-takers.We could raise the ratings if the company takes steps to improve its liquidity (for example, through a reduction in its common share dividend) such that it is consistent with our criteria description of “adequate” and demonstrates concrete steps in recontracting the expiring PPAs while maintaining or improving its significant financial risk profile. We expect the company to continue to focus its growth strategy on assets with cash-flow predictability supported by either favorable contracts or regulation.
We could consider lowering the ratings should Capstone’s overall cash flow quality weaken materially from its moderate level of stability. This could come from major operational disruptions in its generation facilities or acquisition of assets with materially higher cash flow variability. In addition, we could consider a negative rating action if we expect the company’s cash-flow coverage measures to weaken materially, with partially consolidated cash flow to interest falling below 2.7x or partially consolidated cash flow to total recourse debt falling below 20% on a sustained basis, in accordance with our criteria for project developers. This could happen if it increases its reliance on debt financing to support its growth initiatives or its distribution. In addition, failure to renew expiring PPAs or replace them with acquisitions of other contracted assets could also lead to a downgrade in the medium term.
DBRS affirmed DGS.PR.A at Pfd-3:
DBRS has today confirmed the rating of the Preferred Shares of Dividend Growth Split Corp. (the Company) at Pfd-3. In December 2007, the Company issued approximately 1.5 million Preferred Shares (at $10 each) and an equal number of Class A Shares (at $15 each). The scheduled redemption date for both classes of shares issued is November 30, 2014.
…
Since the rating was last confirmed in May 2011, following the completion of a merger of the Company with Brompton Equity Split Corp., the net asset value (NAV) of the Company has remained fairly stable, with downside protection fluctuating between 38% and 47%. The current downside protection (as of April 26, 2012) is approximately 42%. Based on the current yields of the underlying securities in the Portfolio, the dividend coverage ratio is approximately 1.43 times as of April 30, 2012, so the dividends received on the Portfolio fully cover the Preferred Share distributions.
The Canadian preferred share market closed the month with a mildly negative day, with PerpetualPremiums flat, FixedResets off 4bp and DeemedRetractibles down 6bp. Volatility was good. Volume was average.
| 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 | 0.00 % | 0.00 % | 0 | 0.00 | 0 | -0.2405 % | 2,471.7 |
| FixedFloater | 4.47 % | 3.85 % | 30,929 | 17.62 | 1 | -1.1628 % | 3,526.4 |
| Floater | 2.92 % | 2.94 % | 69,922 | 19.82 | 3 | -0.2405 % | 2,668.8 |
| OpRet | 4.79 % | 2.18 % | 38,998 | 1.05 | 5 | 0.4106 % | 2,505.0 |
| SplitShare | 5.30 % | -3.50 % | 51,679 | 0.55 | 4 | -0.6212 % | 2,701.5 |
| Interest-Bearing | 0.00 % | 0.00 % | 0 | 0.00 | 0 | 0.4106 % | 2,290.6 |
| Perpetual-Premium | 5.46 % | 2.87 % | 77,772 | 0.61 | 25 | -0.0024 % | 2,224.7 |
| Perpetual-Discount | 5.09 % | 5.10 % | 79,491 | 15.24 | 8 | 0.1705 % | 2,438.5 |
| FixedReset | 5.08 % | 3.33 % | 194,827 | 7.68 | 69 | -0.0359 % | 2,383.6 |
| Deemed-Retractible | 5.01 % | 3.84 % | 159,547 | 2.92 | 45 | -0.0616 % | 2,306.8 |
| Performance Highlights | |||
| Issue | Index | Change | Notes |
| FBS.PR.C | SplitShare | -2.86 % | YTW SCENARIO Maturity Type : Call Maturity Date : 2012-12-15 Maturity Price : 10.00 Evaluated at bid price : 10.52 Bid-YTW : -4.99 % |
| GWO.PR.J | FixedReset | -1.73 % | YTW SCENARIO Maturity Type : Call Maturity Date : 2013-12-31 Maturity Price : 25.00 Evaluated at bid price : 25.55 Bid-YTW : 4.26 % |
| MFC.PR.B | Deemed-Retractible | -1.60 % | YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 22.70 Bid-YTW : 5.91 % |
| BAM.PR.G | FixedFloater | -1.16 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2042-05-31 Maturity Price : 22.14 Evaluated at bid price : 21.25 Bid-YTW : 3.85 % |
| PWF.PR.M | FixedReset | 1.00 % | YTW SCENARIO Maturity Type : Call Maturity Date : 2014-01-31 Maturity Price : 25.00 Evaluated at bid price : 26.20 Bid-YTW : 3.35 % |
| IAG.PR.A | Deemed-Retractible | 1.04 % | YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 23.25 Bid-YTW : 5.52 % |
| BAM.PR.O | OpRet | 1.09 % | YTW SCENARIO Maturity Type : Option Certainty Maturity Date : 2013-06-30 Maturity Price : 25.00 Evaluated at bid price : 25.96 Bid-YTW : 2.18 % |
| FTS.PR.E | OpRet | 1.10 % | YTW SCENARIO Maturity Type : Call Maturity Date : 2013-06-01 Maturity Price : 25.75 Evaluated at bid price : 26.60 Bid-YTW : 1.44 % |
| BAM.PR.N | Perpetual-Discount | 1.50 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2042-05-31 Maturity Price : 23.19 Evaluated at bid price : 23.65 Bid-YTW : 5.08 % |
| RY.PR.Y | FixedReset | 7.36 % | Reversing yesterday’s nonsense. YTW SCENARIO Maturity Type : Call Maturity Date : 2014-11-24 Maturity Price : 25.00 Evaluated at bid price : 26.40 Bid-YTW : 3.79 % |
| Volume Highlights | |||
| Issue | Index | Shares Traded |
Notes |
| PWF.PR.M | FixedReset | 184,805 | Desjardins crossed 181,000 at 26.10. YTW SCENARIO Maturity Type : Call Maturity Date : 2014-01-31 Maturity Price : 25.00 Evaluated at bid price : 26.20 Bid-YTW : 3.35 % |
| BMO.PR.N | FixedReset | 115,282 | National crossed 106,100 at 26.45. YTW SCENARIO Maturity Type : Call Maturity Date : 2014-02-25 Maturity Price : 25.00 Evaluated at bid price : 26.47 Bid-YTW : 3.08 % |
| RY.PR.N | FixedReset | 97,205 | National crossed blocks of 68,600 and 25,000, both at 26.25. YTW SCENARIO Maturity Type : Call Maturity Date : 2014-02-24 Maturity Price : 25.00 Evaluated at bid price : 26.25 Bid-YTW : 3.35 % |
| PWF.PR.L | Perpetual-Premium | 85,324 | Nesbitt crossed 83,900 at 25.15. YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2042-05-31 Maturity Price : 24.75 Evaluated at bid price : 25.08 Bid-YTW : 5.13 % |
| MFC.PR.A | OpRet | 65,760 | Desjardins crossed 60,000 at 25.20. YTW SCENARIO Maturity Type : Soft Maturity Maturity Date : 2015-12-18 Maturity Price : 25.00 Evaluated at bid price : 25.15 Bid-YTW : 3.87 % |
| CM.PR.L | FixedReset | 53,170 | TD crossed 40,000 at 26.75. YTW SCENARIO Maturity Type : Call Maturity Date : 2014-04-30 Maturity Price : 25.00 Evaluated at bid price : 26.50 Bid-YTW : 3.55 % |
| There were 35 other index-included issues trading in excess of 10,000 shares. | |||
| Wide Spread Highlights | ||
| Issue | Index | Quote Data and Yield Notes |
| GWO.PR.J | FixedReset | Quote: 25.55 – 26.05 Spot Rate : 0.5000 Average : 0.3051 YTW SCENARIO |
| MFC.PR.A | OpRet | Quote: 25.15 – 25.49 Spot Rate : 0.3400 Average : 0.2256 YTW SCENARIO |
| W.PR.H | Perpetual-Premium | Quote: 25.53 – 25.87 Spot Rate : 0.3400 Average : 0.2258 YTW SCENARIO |
| MFC.PR.D | FixedReset | Quote: 26.45 – 26.69 Spot Rate : 0.2400 Average : 0.1368 YTW SCENARIO |
| MFC.PR.F | FixedReset | Quote: 24.11 – 24.46 Spot Rate : 0.3500 Average : 0.2494 YTW SCENARIO |
| GWO.PR.H | Deemed-Retractible | Quote: 24.30 – 24.57 Spot Rate : 0.2700 Average : 0.1766 YTW SCENARIO |