{"id":24383,"date":"2014-02-05T21:27:45","date_gmt":"2014-02-06T02:27:45","guid":{"rendered":"http:\/\/prefblog.com\/?p=24383"},"modified":"2014-02-05T21:27:45","modified_gmt":"2014-02-06T02:27:45","slug":"february-5-2014","status":"publish","type":"post","link":"https:\/\/prefblog.com\/?p=24383","title":{"rendered":"February 5, 2014"},"content":{"rendered":"

DBRS doesn’t like the New Brunswick budget<\/a>:<\/p>\n

DBRS notes that the Province of New Brunswick (the Province or New Brunswick; rated A (high) with a Stable trend) kicked off the provincial budget season with its 2014 budget on February 4, 2014, which calls for a slow and protracted path back to balance by 2017-18. Although last year\u2019s budget incorporated no firm time commitment to restore balance, the plan presented in 2012-13 did point to a balanced budget by 2014-15. DBRS was aware that some slippage had been incurred in light of weak economic performance but did not expect the full extent of deterioration revealed in yesterday\u2019s budget. As a result, the revised fiscal targets raise the possibility of as much as $400 million to $500 million in additional debt over the next four fiscal years, which was not factored into last year\u2019s rating review. While the revised outlook is potentially manageable for the credit profile, DBRS remains concerned that continued sluggish economic growth for an extended period of time or weakening fiscal resolve could push credit metrics to levels no longer consistent with the current ratings.
…<\/b>
Based on the revised fiscal forecasts, DBRS-adjusted debt is estimated to have risen by 5% in 2013-14 to $12.5 billion. As a result of Statistics Canada\u2019s downward revisions to historical GDP figures in December 2013 combined with very slow nominal GDP growth in 2013, debt-to-GDP is forecast to reach almost 40% at March 31, 2014. The Province\u2019s debt burden is expected to peak around 41% in 2015-16. This exceeds the peak at the time of last year\u2019s review and, more importantly, is well above pre-recession levels of less than 30%. As a result, even if the Province successfully executes its fiscal recovery plan as currently envisioned, DBRS believes little flexibility will be left within the current rating for further erosion. Additional fiscal slippage pushing the debt-to-GDP ratio toward 45% would be cause for concern for DBRS and could result in downward pressure on the rating.<\/p><\/blockquote>\n

It was a mildly negative day for the Canadian preferred share market, with PerpetualDiscounts down 7bp, FixedResets off 3bp and DeemedRetractibles losing 9bp. A surprisingly lengthy Performance Highlights table is notable for the presence of losing Floating Rate issues. Volume was below average.<\/p>\n

PerpetualDiscounts now yield 5.58%, equivalent to 7.25% interest at the standard conversion factor of 1.3x. Long Corporates<\/a> now yield about 4.5% (maybe a little less), so the pre-tax interest-equivalent spread is now about 275bp, the same as that reported on January 29<\/a>.<\/p>\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n
HIMIPref™ Preferred Indices
These values reflect the December 2008 revision of the HIMIPref™ Indices<\/strong>
Values are provisional and are finalized monthly<\/td>\n<\/tr>\n
Index<\/td>\nMean
Current
Yield
(at bid)<\/td>\n		Median
YTW<\/td>\n		Median
Average
Trading
Value<\/td>\n		Median
Mod Dur
(YTW)<\/td>\n		Issues<\/td>\nDay’s Perf.<\/td>\nIndex Value<\/td>\n<\/tr>\n
Ratchet<\/td>\n0.00 %<\/td>\n0.00 %<\/td>\n0<\/td>\n0.00<\/td>\n0<\/td>\n-0.8671 %<\/td>\n2,324.8<\/td>\n<\/tr>\n
FixedFloater<\/td>\n4.60 %<\/td>\n3.85 %<\/td>\n28,141<\/td>\n17.74<\/td>\n1<\/td>\n0.0484 %<\/td>\n3,690.7<\/td>\n<\/tr>\n
Floater<\/td>\n3.11 %<\/td>\n3.22 %<\/td>\n58,594<\/td>\n19.16<\/td>\n4<\/td>\n-0.8671 %<\/td>\n2,510.1<\/td>\n<\/tr>\n
OpRet<\/td>\n4.60 %<\/td>\n0.69 %<\/td>\n73,224<\/td>\n0.31<\/td>\n3<\/td>\n-0.1150 %<\/td>\n2,681.4<\/td>\n<\/tr>\n
SplitShare<\/td>\n4.86 %<\/td>\n4.94 %<\/td>\n63,271<\/td>\n4.36<\/td>\n5<\/td>\n-0.1204 %<\/td>\n3,014.7<\/td>\n<\/tr>\n
Interest-Bearing<\/td>\n0.00 %<\/td>\n0.00 %<\/td>\n0<\/td>\n0.00<\/td>\n0<\/td>\n-0.1150 %<\/td>\n2,451.9<\/td>\n<\/tr>\n
Perpetual-Premium<\/td>\n5.66 %<\/td>\n-0.85 %<\/td>\n106,186<\/td>\n0.09<\/td>\n12<\/td>\n-0.0577 %<\/td>\n2,336.7<\/td>\n<\/tr>\n
Perpetual-Discount<\/td>\n5.53 %<\/td>\n5.58 %<\/td>\n154,656<\/td>\n14.51<\/td>\n26<\/td>\n-0.0676 %<\/td>\n2,394.8<\/td>\n<\/tr>\n
FixedReset<\/td>\n4.91 %<\/td>\n3.65 %<\/td>\n213,635<\/td>\n6.87<\/td>\n81<\/td>\n-0.0266 %<\/td>\n2,487.4<\/td>\n<\/tr>\n
Deemed-Retractible<\/td>\n5.13 %<\/td>\n4.12 %<\/td>\n171,211<\/td>\n1.96<\/td>\n42<\/td>\n-0.0898 %<\/td>\n2,418.2<\/td>\n<\/tr>\n
FloatingReset<\/td>\n2.67 %<\/td>\n2.59 %<\/td>\n187,825<\/td>\n7.18<\/td>\n6<\/td>\n-0.4475 %<\/td>\n2,436.5<\/td>\n<\/tr>\n<\/table>\n\n\n\n\n\n\n\n\n\n\n\n
Performance Highlights<\/strong><\/td>\n<\/tr>\n
Issue<\/td>\nIndex<\/td>\nChange<\/td>\nNotes<\/td>\n<\/tr>\n
BAM.PR.K<\/td>\nFloater<\/td>\n-1.69 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2044-02-05
\nMaturity Price : 16.24
\nEvaluated at bid price : 16.24
\nBid-YTW : 3.26 %<\/td>\n<\/tr>\n
BAM.PR.C<\/td>\nFloater<\/td>\n-1.69 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2044-02-05
\nMaturity Price : 16.30
\nEvaluated at bid price : 16.30
\nBid-YTW : 3.24 %<\/td>\n<\/tr>\n
BAM.PR.B<\/td>\nFloater<\/td>\n-1.62 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2044-02-05
\nMaturity Price : 16.42
\nEvaluated at bid price : 16.42
\nBid-YTW : 3.22 %<\/td>\n<\/tr>\n
BNS.PR.N<\/td>\nDeemed-Retractible<\/td>\n-1.35 %<\/td>\nYTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2016-01-27
\nMaturity Price : 25.25
\nEvaluated at bid price : 25.49
\nBid-YTW : 4.76 %<\/td>\n<\/tr>\n
BNS.PR.B<\/td>\nFloatingReset<\/td>\n-1.24 %<\/td>\nYTW SCENARIO
\nMaturity Type : Hard Maturity
\nMaturity Date\t: 2022-01-31
\nMaturity Price : 25.00
\nEvaluated at bid price : 24.63
\nBid-YTW : 2.74 %<\/td>\n<\/tr>\n
TRP.PR.C<\/td>\nFixedReset<\/td>\n-1.19 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2044-02-05
\nMaturity Price : 21.37
\nEvaluated at bid price : 21.68
\nBid-YTW : 3.70 %<\/td>\n<\/tr>\n
CU.PR.G<\/td>\nPerpetual-Discount<\/td>\n1.09 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2044-02-05
\nMaturity Price : 21.42
\nEvaluated at bid price : 21.42
\nBid-YTW : 5.26 %<\/td>\n<\/tr>\n
PWF.PR.A<\/td>\nFloater<\/td>\n1.32 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2044-02-05
\nMaturity Price : 18.49
\nEvaluated at bid price : 18.49
\nBid-YTW : 2.83 %<\/td>\n<\/tr>\n<\/table>\n\n\n\n\n\n\n\n\n\n\n
Volume Highlights<\/strong><\/td>\n<\/tr>\n
Issue<\/td>\nIndex<\/td>\nShares
Traded<\/td>\n		Notes<\/td>\n<\/tr>\n
RY.PR.Z<\/td>\nFixedReset<\/td>\n87,220<\/td>\nRecent new issue<\/a>.
\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2044-02-05
\nMaturity Price : 23.14
\nEvaluated at bid price : 24.98
\nBid-YTW : 3.71 %<\/td>\n<\/tr>\n
BNS.PR.R<\/td>\nFixedReset<\/td>\n71,683<\/td>\nTD crossed 57,200 at 25.15.
\nYTW SCENARIO
\nMaturity Type : Hard Maturity
\nMaturity Date\t: 2022-01-31
\nMaturity Price : 25.00
\nEvaluated at bid price : 25.20
\nBid-YTW : 3.59 %<\/td>\n<\/tr>\n
TRP.PR.E<\/td>\nFixedReset<\/td>\n70,650<\/td>\nRecent new issue<\/a>.
\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2044-02-05
\nMaturity Price : 23.07
\nEvaluated at bid price : 24.84
\nBid-YTW : 3.93 %<\/td>\n<\/tr>\n
BNS.PR.O<\/td>\nDeemed-Retractible<\/td>\n55,600<\/td>\nTD crossed 50,000 at 26.14.
\nYTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2014-04-28
\nMaturity Price : 25.75
\nEvaluated at bid price : 26.10
\nBid-YTW : -0.35 %<\/td>\n<\/tr>\n
NA.PR.M<\/td>\nDeemed-Retractible<\/td>\n54,912<\/td>\nTD crossed 50,000 at 26.09.
\nYTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2014-05-15
\nMaturity Price : 25.75
\nEvaluated at bid price : 26.05
\nBid-YTW : 0.93 %<\/td>\n<\/tr>\n
PWF.PR.E<\/td>\nPerpetual-Discount<\/td>\n44,255<\/td>\nScotia crossed 40,000 at 24.65.
\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2044-02-05
\nMaturity Price : 24.34
\nEvaluated at bid price : 24.65
\nBid-YTW : 5.61 %<\/td>\n<\/tr>\n
There were 26 other index-included issues trading in excess of 10,000 shares.<\/td>\n<\/tr>\n<\/table>\n\n\n\n\n\n\n\n\n\n
Wide Spread Highlights<\/strong><\/td>\n<\/tr>\n
Issue<\/td>\nIndex<\/td>\nQuote Data and Yield Notes<\/td>\n<\/tr>\n
TRP.PR.C<\/td>\nFixedReset<\/td>\nQuote: 21.68 – 22.04
\nSpot Rate : 0.3600
\nAverage : 0.2584<\/p>\n

YTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2044-02-05
\nMaturity Price : 21.37
\nEvaluated at bid price : 21.68
\nBid-YTW : 3.70 %<\/td>\n<\/tr>\n

FTS.PR.H<\/td>\nFixedReset<\/td>\nQuote: 21.11 – 21.40
\nSpot Rate : 0.2900
\nAverage : 0.2032<\/p>\n

YTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2044-02-05
\nMaturity Price : 21.11
\nEvaluated at bid price : 21.11
\nBid-YTW : 3.71 %<\/td>\n<\/tr>\n

PWF.PR.A<\/td>\nFloater<\/td>\nQuote: 18.49 – 18.99
\nSpot Rate : 0.5000
\nAverage : 0.4283<\/p>\n

YTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2044-02-05
\nMaturity Price : 18.49
\nEvaluated at bid price : 18.49
\nBid-YTW : 2.83 %<\/td>\n<\/tr>\n

BNS.PR.K<\/td>\nDeemed-Retractible<\/td>\nQuote: 25.06 – 25.25
\nSpot Rate : 0.1900
\nAverage : 0.1198<\/p>\n

YTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2014-04-28
\nMaturity Price : 25.00
\nEvaluated at bid price : 25.06
\nBid-YTW : 3.98 %<\/td>\n<\/tr>\n

BNS.PR.N<\/td>\nDeemed-Retractible<\/td>\nQuote: 25.49 – 25.80
\nSpot Rate : 0.3100
\nAverage : 0.2489<\/p>\n

YTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2016-01-27
\nMaturity Price : 25.25
\nEvaluated at bid price : 25.49
\nBid-YTW : 4.76 %<\/td>\n<\/tr>\n

W.PR.H<\/td>\nPerpetual-Discount<\/td>\nQuote: 24.47 – 24.64
\nSpot Rate : 0.1700
\nAverage : 0.1104<\/p>\n

YTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2044-02-05
\nMaturity Price : 24.21
\nEvaluated at bid price : 24.47
\nBid-YTW : 5.67 %<\/td>\n<\/tr>\n<\/table>\n","protected":false},"excerpt":{"rendered":"

DBRS doesn’t like the New Brunswick budget: DBRS notes that the Province of New Brunswick (the Province or New Brunswick; rated A (high) with a Stable trend) kicked off the provincial budget season with its …<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[15],"tags":[],"class_list":["post-24383","post","type-post","status-publish","format-standard","hentry","category-market-action"],"_links":{"self":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts\/24383","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=24383"}],"version-history":[{"count":0,"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts\/24383\/revisions"}],"wp:attachment":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=24383"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=24383"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=24383"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}