PrefBlog

Well, I’ve been threatening to do it for a long, long time and now it’s finally happened: the DeemedMaturity date for insurance issues has been changed from 2025-1-31 to 2030-1-31.

For a review of why I believe that insurance issues will be redeemed at par on or prior to the DeemedMaturity date, please see the DeemedRetractible Review: September, 2016 and don’t forget to read the updates.

The new date has been chosen with the idea that a decision will be made by the IAIS (International Association of Insurance Supervisors) in 2019, and (if favourable) will be implemented with an 11-year grace period, similarly to the banks. We shall see just how accurate these suppositions might be!

This change has, of course, led to an increase in the calculated Modified Duration and a decrease in the calculated Yield-to-Worst for these issues. Old and new figures for these metrics may be found at:

Deemed Retractibles, 2018-12-24, maturity 2025

Deemed Retractibles, 2018-12-24, maturity 2030

FixedResets, 2018-12-24, maturity 2025

FixedResets, 2018-12-24, maturity 2030

Affected issues are:

FixedResets EML.PR.A, GWO.PR.N, IAG.PR.G, IAG.PR.I, IFC.PR.A, IFC.PR.C, IFC.PR.G, MFC.PR.F, MFC.PR.G, MFC.PR.H, MFC.PR.I, MFC.PR.J, MFC.PR.K, MFC.PR.L, MFC.PR.M, MFC.PR.N, MFC.PR.O, MFC.PR.Q, MFC.PR.R, SLF.PR.G, SLF.PR.H, SLF.PR.I

FloatingReset GWO.PR.O, IFC.PR.D, MFC.PR.P, SLF.PR.J and SLF.PR.K

DeemedRetractibles CCS.PR.C, GWO.PR.F, GWO.PR.G, GWO.PR.H, GWO.PR.I, GWO.PR.L, GWO.PR.M, GWO.PR.P, GWO.PR.Q, GWO.PR.R, GWO.PR.S, GWO.PR.T, IAG.PR.A, IFC.PR.E, IFC.PR.F, MFC.PR.B, MFC.PR.C, SLF.PR.A, SLF.PR.B, SLF.PR.C, SLF.PR.D, SLF.PR.E

This entry was posted on Wednesday, December 26th, 2018 at 10:58 pm and is filed under Data Changes, Issue Comments. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.