{"id":7281,"date":"2009-07-16T20:17:24","date_gmt":"2009-07-17T00:17:24","guid":{"rendered":"http:\/\/www.prefblog.com\/?p=7281"},"modified":"2009-07-16T20:17:24","modified_gmt":"2009-07-17T00:17:24","slug":"july-16-2009","status":"publish","type":"post","link":"https:\/\/prefblog.com\/?p=7281","title":{"rendered":"July 16, 2009"},"content":{"rendered":"

The amount of US Commercial Paper outstanding<\/a> is shrinking dramatically. Bloomberg reports<\/a>:<\/p>\n

For now, companies are willing to pay higher rates to ensure access to capital after watching credit dry up almost overnight as the subprime mortgage contagion spread in 2007 and 2008 and Lehman Brothers Holdings Inc. collapsed in September.<\/p>\n

More than 60 companies sold bonds this year to repay commercial paper, including Con Edison, Verizon Communications Inc. in New York and Kellogg, the 103-year-old maker of Keebler cookies and Rice Krispies cereal, according to data compiled by Bloomberg. Non-financial companies have sold $306 billion of investment-grade bonds this year, a record pace.<\/p>\n

\u201cTreasurers aren\u2019t sleeping at night because they don\u2019t know if they can roll over commercial paper,\u201d said Anthony J. Carfang, a partner at Treasury Strategies Inc, a Chicago consulting firm. \u201cThey\u2019d rather lock in money for five years and pay a little more.\u201d<\/p><\/blockquote>\n

Maybe it’s not so much a bad thing. With all the new emphasis on liquidity management and the example of CIT impossible to ignore, maybe these treasurers are wondering ‘What if we’re completely locked out of the capital markets for a year?’<\/p>\n

Speaking of CIT …. bondholders are reportedly discussing a debt-for-equity swap<\/a>:<\/p>\n

Pacific Investment Management Co., CIT\u2019s largest bondholder based on regulatory filings, was to host a call, and debt owners are considering hiring financial and legal advisers, said the person, who declined to be identified because the discussions are private. The company hasn\u2019t proposed an exchange offer.
…<\/b>
\u201cCIT indicated that it needs at least $2 billion of rescue financing in the next 24 hours or it would likely file,\u201d CreditSights analysts Adam Steer, David Hendler and Pri De Silva wrote in a report. \u201cWe believe the figure is in the range of $4 to $6 billion plus, making outside capital sources shy away.\u201d<\/p><\/blockquote>\n

This would presumably wipe-out the participants in December’s $2.4-billion swap<\/a>. The company, rather predictably, has issued a press release<\/a> stating:<\/p>\n

that its Board of Directors and management, in consultation with their advisors, are continuing to evaluate alternatives to improve the Company\u2019s liquidity. CIT is in discussions with potential lenders to secure financing.<\/p>\n

The Company is continuing to serve customers. CIT appreciates the strong support it has received from many of its 1 million small business and middle market customers, industry associations and dedicated employees.<\/p><\/blockquote>\n

Another day of strong performance for preferred shares, on continued good volume. I don’t know what happened to the MFC PerpetualDiscounts – their decline was unmatched by the MFC FixedResets and common. Just another one of those pref thingies, I guess…<\/p>\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-0.3617 %<\/td>\n1,154.8<\/td>\n<\/tr>\n
FixedFloater<\/td>\n7.25 %<\/td>\n5.46 %<\/td>\n35,501<\/td>\n16.68<\/td>\n1<\/td>\n0.0000 %<\/td>\n2,118.3<\/td>\n<\/tr>\n
Floater<\/td>\n3.30 %<\/td>\n3.89 %<\/td>\n80,930<\/td>\n17.68<\/td>\n3<\/td>\n-0.3617 %<\/td>\n1,442.7<\/td>\n<\/tr>\n
OpRet<\/td>\n4.98 %<\/td>\n-2.98 %<\/td>\n130,922<\/td>\n0.09<\/td>\n15<\/td>\n0.0261 %<\/td>\n2,218.5<\/td>\n<\/tr>\n
SplitShare<\/td>\n6.08 %<\/td>\n4.12 %<\/td>\n96,579<\/td>\n4.15<\/td>\n4<\/td>\n0.3799 %<\/td>\n1,927.2<\/td>\n<\/tr>\n
Interest-Bearing<\/td>\n0.00 %<\/td>\n0.00 %<\/td>\n0<\/td>\n0.00<\/td>\n0<\/td>\n0.0261 %<\/td>\n2,028.6<\/td>\n<\/tr>\n
Perpetual-Premium<\/td>\n0.00 %<\/td>\n0.00 %<\/td>\n0<\/td>\n0.00<\/td>\n0<\/td>\n0.2136 %<\/td>\n1,776.6<\/td>\n<\/tr>\n
Perpetual-Discount<\/td>\n6.24 %<\/td>\n6.26 %<\/td>\n159,835<\/td>\n13.53<\/td>\n71<\/td>\n0.2136 %<\/td>\n1,636.3<\/td>\n<\/tr>\n
FixedReset<\/td>\n5.55 %<\/td>\n4.29 %<\/td>\n569,360<\/td>\n4.28<\/td>\n40<\/td>\n0.2268 %<\/td>\n2,072.2<\/td>\n<\/tr>\n<\/table>\n\n\n\n\n\n\n\n\n\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
MFC.PR.B<\/td>\nPerpetual-Discount<\/td>\n-3.72 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2039-07-16
\nMaturity Price : 18.11
\nEvaluated at bid price : 18.11
\nBid-YTW : 6.51 %<\/td>\n<\/tr>\n
MFC.PR.C<\/td>\nPerpetual-Discount<\/td>\n-2.95 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2039-07-16
\nMaturity Price : 17.43
\nEvaluated at bid price : 17.43
\nBid-YTW : 6.54 %<\/td>\n<\/tr>\n
PWF.PR.L<\/td>\nPerpetual-Discount<\/td>\n-1.27 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2039-07-16
\nMaturity Price : 20.14
\nEvaluated at bid price : 20.14
\nBid-YTW : 6.36 %<\/td>\n<\/tr>\n
BAM.PR.O<\/td>\nOpRet<\/td>\n-1.03 %<\/td>\nYTW SCENARIO
\nMaturity Type : Option Certainty
\nMaturity Date\t: 2013-06-30
\nMaturity Price : 25.00
\nEvaluated at bid price : 23.91
\nBid-YTW : 6.37 %<\/td>\n<\/tr>\n
RY.PR.G<\/td>\nPerpetual-Discount<\/td>\n1.01 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2039-07-16
\nMaturity Price : 19.02
\nEvaluated at bid price : 19.02
\nBid-YTW : 6.02 %<\/td>\n<\/tr>\n
RY.PR.W<\/td>\nPerpetual-Discount<\/td>\n1.14 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2039-07-16
\nMaturity Price : 20.41
\nEvaluated at bid price : 20.41
\nBid-YTW : 6.11 %<\/td>\n<\/tr>\n
CM.PR.E<\/td>\nPerpetual-Discount<\/td>\n1.19 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2039-07-16
\nMaturity Price : 21.80
\nEvaluated at bid price : 22.10
\nBid-YTW : 6.35 %<\/td>\n<\/tr>\n
RY.PR.F<\/td>\nPerpetual-Discount<\/td>\n1.23 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2039-07-16
\nMaturity Price : 19.00
\nEvaluated at bid price : 19.00
\nBid-YTW : 5.96 %<\/td>\n<\/tr>\n
GWO.PR.I<\/td>\nPerpetual-Discount<\/td>\n1.27 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2039-07-16
\nMaturity Price : 18.28
\nEvaluated at bid price : 18.28
\nBid-YTW : 6.22 %<\/td>\n<\/tr>\n
PWF.PR.J<\/td>\nOpRet<\/td>\n1.36 %<\/td>\nYTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2009-08-15
\nMaturity Price : 25.75
\nEvaluated at bid price : 26.00
\nBid-YTW : -9.27 %<\/td>\n<\/tr>\n
POW.PR.D<\/td>\nPerpetual-Discount<\/td>\n1.42 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2039-07-16
\nMaturity Price : 20.00
\nEvaluated at bid price : 20.00
\nBid-YTW : 6.30 %<\/td>\n<\/tr>\n
POW.PR.A<\/td>\nPerpetual-Discount<\/td>\n1.43 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2039-07-16
\nMaturity Price : 21.31
\nEvaluated at bid price : 21.31
\nBid-YTW : 6.62 %<\/td>\n<\/tr>\n
BMO.PR.P<\/td>\nFixedReset<\/td>\n1.53 %<\/td>\nYTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2015-03-27
\nMaturity Price : 25.00
\nEvaluated at bid price : 26.60
\nBid-YTW : 4.21 %<\/td>\n<\/tr>\n
BAM.PR.M<\/td>\nPerpetual-Discount<\/td>\n1.54 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2039-07-16
\nMaturity Price : 15.82
\nEvaluated at bid price : 15.82
\nBid-YTW : 7.60 %<\/td>\n<\/tr>\n
IAG.PR.C<\/td>\nFixedReset<\/td>\n1.75 %<\/td>\nYTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2014-01-30
\nMaturity Price : 25.00
\nEvaluated at bid price : 26.72
\nBid-YTW : 4.60 %<\/td>\n<\/tr>\n
CU.PR.A<\/td>\nPerpetual-Discount<\/td>\n1.87 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2039-07-16
\nMaturity Price : 24.18
\nEvaluated at bid price : 24.50
\nBid-YTW : 6.00 %<\/td>\n<\/tr>\n
BNA.PR.C<\/td>\nSplitShare<\/td>\n1.93 %<\/td>\nPro forma asset coverage of 2.6+:1 as of July 8, according to DBRS<\/a>.
\nYTW SCENARIO
\nMaturity Type : Hard Maturity
\nMaturity Date\t: 2019-01-10
\nMaturity Price : 25.00
\nEvaluated at bid price : 16.36
\nBid-YTW : 10.27 %<\/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
BAM.PR.K<\/td>\nFloater<\/td>\n102,100<\/td>\nRBC crossed 98,600 at 10.00.
\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2039-07-16
\nMaturity Price : 10.10
\nEvaluated at bid price : 10.10
\nBid-YTW : 3.92 %<\/td>\n<\/tr>\n
BMO.PR.P<\/td>\nFixedReset<\/td>\n73,995<\/td>\nYTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2015-03-27
\nMaturity Price : 25.00
\nEvaluated at bid price : 26.60
\nBid-YTW : 4.21 %<\/td>\n<\/tr>\n
MFC.PR.C<\/td>\nPerpetual-Discount<\/td>\n73,975<\/td>\nScotia crossed 24,500 at 17.75.
\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2039-07-16
\nMaturity Price : 17.43
\nEvaluated at bid price : 17.43
\nBid-YTW : 6.54 %<\/td>\n<\/tr>\n
SLF.PR.C<\/td>\nPerpetual-Discount<\/td>\n58,450<\/td>\nRBC crossed 49,800 at 17.10.
\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2039-07-16
\nMaturity Price : 17.07
\nEvaluated at bid price : 17.07
\nBid-YTW : 6.59 %<\/td>\n<\/tr>\n
RY.PR.I<\/td>\nFixedReset<\/td>\n48,637<\/td>\nScotia sold 22,600 to anonymous at 25.56.
\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2039-07-16
\nMaturity Price : 25.58
\nEvaluated at bid price : 25.63
\nBid-YTW : 4.46 %<\/td>\n<\/tr>\n
MFC.PR.E<\/td>\nFixedReset<\/td>\n46,175<\/td>\nYTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2014-10-19
\nMaturity Price : 25.00
\nEvaluated at bid price : 26.19
\nBid-YTW : 4.74 %<\/td>\n<\/tr>\n
There were 59 other index-included issues trading in excess of 10,000 shares.<\/td>\n<\/tr>\n<\/table>\n","protected":false},"excerpt":{"rendered":"

The amount of US Commercial Paper outstanding is shrinking dramatically. Bloomberg reports: For now, companies are willing to pay higher rates to ensure access to capital after watching credit dry up almost overnight as the …<\/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-7281","post","type-post","status-publish","format-standard","hentry","category-market-action"],"_links":{"self":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts\/7281","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=7281"}],"version-history":[{"count":0,"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts\/7281\/revisions"}],"wp:attachment":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=7281"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=7281"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=7281"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}