/raid1/www/Hosts/bankrupt/TCREUR_Public/240826.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
E U R O P E
Monday, August 26, 2024, Vol. 25, No. 171
Headlines
F R A N C E
EUROPCAR MOBILITY: S&P Affirms 'B+' ICR, Alters Outlook to Negative
G E O R G I A
TBC INSURANCE: Fitch Assigns 'BB' LongTerm IDR, Outlook Stable
G E R M A N Y
PFLEIDERER GROUP: S&P Upgrades ICR to 'CCC+', Outlook Stable
G R E E C E
TITAN CEMENT: S&P Upgrades LT ICR to 'BB+', Outlook Stable
I R E L A N D
AQUEDUCT 7-2022: Fitch Assigns 'B-sf' Final Rating to Cl. F-R Notes
ARBOUR CLO XIII: Fitch Assigns 'B-sf' Final Rating to Class F Notes
BAIN CAPITAL 2018-2: Fitch Hikes Class E Notes Rating to 'BB+sf'
CAIRN CLO X: Fitch Hikes Rating on Class F Notes to 'B+sf'
DRYDEN 62: Fitch Affirms 'B+sf' Rating on Cl. F Notes
HENLEY CLO VII: S&P Assigns B- (sf) Rating on Class F-R Notes
OCP EURO 2024-10: Fitch Assigns 'B-sf' Final Rating to Cl. F Notes
OZLME III: S&P Affirms 'B- (sf)' Rating on Class F Notes
RRE 21: S&P Assigns Prelim BB- (sf) Rating to Class D Notes
T U R K E Y
IZMIR METROPOLITAN: Fitch Affirms 'B+' LongTerm IDR, Outlook Stable
KONYA METROPOLITAN: Fitch Affirms 'B+' LongTerm IDR, Outlook Stable
MANISA METROPOLITAN: Fitch Affirms 'B+' LongTerm IDRs, Outlook Pos.
MERSIN METROPOLITAN: Fitch Affirms 'B+' IDR, Alters Outlook to Pos.
MUGLA METROPOLITAN: Fitch Affirms B+ LongTerm IDR, Outlook Positive
U N I T E D K I N G D O M
EUROSAIL 2006-2BL: S&P Lowers Class E1c Notes Rating to 'B (sf)'
RMAC NO.3: Fitch Affirms Bsf Rating on Cl. F Notes, Outlook Stable
X X X X X X X X
[*] BOND PRICING: For the Week August 19 to August 23, 2024
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F R A N C E
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EUROPCAR MOBILITY: S&P Affirms 'B+' ICR, Alters Outlook to Negative
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S&P Global Ratings revised its outlook on France-based car rental
company Europcar Mobility Group to negative and affirmed its 'B+'
long-term issuer credit ratings on Europcar and Europcar
International SASU, as well as its 'BB-' issue rating on the EUR500
million fleet bond issued by EC Finance PLC.
The negative outlook reflects the risk that Europcar's EBIT
interest coverage could stay below 1.0x and its corporate free cash
flows after interest could stay negative in the next 12 months due
to falling used car prices, weaker pricing, or difficulties with
implementing its strategic improvement measures.
Europcar's operating performance was weaker than expected in 2023,
despite still favorable market conditions. In 2023, the demand for
leisure such as car rental services proved resilient as evidenced
by the solid operating results of some of Europcar's main peers
including Hertz, Avis, and SIXT. Europcar did not benefit to the
same extent from the benign market conditions with its EBIT margin
falling to about 7% from about 11% in 2022, its EBIT interest
coverage ratio dropping to 0.9x, and its corporate free cash flow
turning negative. S&P said, "We note that in 2023, Europcar booked
material reorganization and transformation costs of about EUR60
million for station optimization in Germany and enhancements of the
company's operational structure. In our view, these measures
reflect Europcar's need to trim costs and improve its yield
management. We think that these challenges are also reflected in
the decision of Europcar's shareholders to change the company's CEO
with the arrival of Alain Favey in June 2023, about a year after
appointing the previous CEO."
Europcar has a higher than usual proportion of at-risk vehicles,
which could result in higher fleet depreciation levels in 2024.As
of the end of 2023, Europcar's share of at-risk vehicles amounted
to about 60% of its fleet. This represents an unusually high share,
resulting from the car shortage in the market seen in 2022 and
early 2023 which led car rental companies to turn to at-risk
vehicles to increase the size of their fleets. S&P cautions that
Europcar is therefore exposed to the risk of lower residual values,
which could lead to higher fleet depreciation levels and weaker
operating results in 2024. Eurostat's eurozone used car price index
has receded by about 1.4% since the start of 2024.
S&P said, "We assess Europcar as a moderately strategic entity for
the Volkswagen AG (VW) group and apply an uplift of one notch to
Europcar's 'b' stand-alone credit profile rating. We think that
Europcar's fleet management capabilities and network could play an
important role for VW to develop an integrated mobility platform
covering customers' key mobility needs, including through
subscription and car sharing products. VW and Europcar operate on
an arm's length basis, and we do not anticipate any material
operational synergies between the two groups in the near term.
Furthermore, we expect that Europcar's earnings and cash
contribution to the VW group will remain negligeable in the next
couple of years. In our view, Europcar's EBITDA will account for
less than 2% of VW's EBITDA.
"The negative outlook reflects the risk that Europcar's EBIT
interest coverage could stay below 1.0x and its corporate free cash
flows after interest could stay negative in the next 12 months due
to more challenging market conditions."
S&P could lower its rating on Europcar if used car prices continue
to decline, key markets experience weaker pricing, or there are
missteps in implementing its strategy for operational improvements,
leading to sustained weaker credit metrics with:
-- Funds from operations (FFO) to debt falling below 12%;
-- EBIT interest coverage staying below 1.0x; and
-- Negative corporate free operating cash flow after interest.
S&P said, "We could revise our outlook to stable if Europcar
improves its operating performance such that its S&P Global
Ratings-adjusted EBIT interest coverage increases to above 1.0x on
a sustainable basis combined with FFO to debt of more than 12%; in
addition to restoring positive corporate free cash flow."
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G E O R G I A
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TBC INSURANCE: Fitch Assigns 'BB' LongTerm IDR, Outlook Stable
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Fitch Ratings has assigned Georgia-based TBC Insurance JSC (TBC
Insurance) an Insurer Financial Strength (IFS) rating and Long-Term
Issuer Default Rating (IDR) of 'BB'. The Rating Outlooks are
Stable.
Key Rating Drivers
Leading Domestic Insurer: TBC Insurance is a leading insurance
company in Georgia, operating in both life and non-life insurance
segments, with an overall market share of 17% at end-2023. While
the company's non-life business is focused on motor, medical, and
property insurance, life insurance is concentrated on life
protection for borrowers distributed via the bancassurance channel,
where the company can leverage on the client base of TBC Bank.
Fitch considers TBC Insurance's business profile as 'Favourable'
compared to other Fitch-rated Commonwealth of Independent States
(CIS) insurers, supported by its strong domestic market position.
This assessment also reflects the insurer's moderate business risk
profile, good diversification, and a less favourable operating
scale than larger CIS peers.
Capital Supportive of Ratings: TBC Insurance's capital position, as
measured by Fitch's Prism Global model, was 'Adequate' at end-2023,
improving from 'Somewhat Weak' at end-2022, due to higher equity,
driven by a GEL20.7 million profit in 2023, 47% of which was
retained. Fitch expects the company to maintain a Prism score
supportive of the ratings.
TBC Insurance's regulatory solvency margin rose to 207% at end-1H24
from 156% at end-2023 and 135% at end-2022, driven by GEL17.5
million profit in 6M24. While Fitch views these trends as credit
positive, substantial dividends, comprising 53% of income from
2020-2023, limit the growth of the capital base.
Natural Catastrophe Risk: Georgia faces hydrometeorological hazards
and natural disasters, exposing TBC Insurance to high catastrophe
risk, particularly in property, agriculture, and motor insurance
lines. While some risks are covered by reinsurance, the company
does not currently conduct regular comprehensive assessments of
potential maximum exposure, which drags on its assessment of
capitalisation.
Relatively Risky Asset Quality: TBC Insurance has a risk-averse
investment portfolio with no equity investments, primarily
comprising fixed-income instruments. However, the weighted average
rating of the TBC Insurance investment portfolio is 'BB'. The
largest portion of investments consists of bank deposits. Bonds,
mainly non-investment grade, accounted for 14.4% of total
investments at end-2023. Additionally, 36% of all investments are
concentrated in the sister company TBC Bank in the form of deposits
and bonds, which Fitch considers somewhat risky.
Solid Financial Performance: TBC demonstrates strong financial
performance with a return on average equity of 45% in 2023 (2022:
46%, 2021: 47%). This performance is driven by robust life and
health underwriting results, high investment income, and moderate
but positive property and casualty insurance underwriting results.
The combined ratio remained stable at around 90% in 2023 and 2022,
with a loss ratio of 49% in both years.
Moderate Reserving Risk: Fitch believes that TBC Insurance reserves
adequacy adequately reflect the risks underwritten by the company.
At the same time, the scoring is pressured by limited actuarial
expertise in the market, absence of external actuarial reports, and
the relatively unsophisticated regulatory methodology.
Moderate Reinsurance Utilisation: The company uses reinsurance
moderately, with a net-to-gross premium ratio of 87% in 2023 and
2022. Premium retention rates are high for motor (97%) and accident
and health insurance (100%) in 2023. Credit life insurance is
covered by a quota share treaty with a 74% retention rate measured
by premiums (10% measured by sum insured) in 2023.
The company also employs treaty reinsurance for agriculture
insurance and various facultative excess of loss and surplus
agreements for other lines. The reinsurance panel is good-quality,
mainly consisting of foreign reinsurers with 'A' category credit
ratings.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- Sustained improvement in asset quality, combined with maintenance
of capital adequacy, evidenced by a Prism score of 'Adequate' and a
regulatory solvency margin with substantial buffers above
regulatory requirements.
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- A sustained deterioration in capital position, indicated by the
Prism score falling below 'Somewhat Weak';
- Deterioration of asset quality.
Date of Relevant Committee
08 August 2024
ESG Considerations
The highest level of ESG credit relevance is a score of '3', unless
otherwise disclosed in this section. A score of '3' means ESG
issues are credit-neutral or have only a minimal credit impact on
the entity, either due to their nature or the way in which they are
being managed by the entity. Fitch's ESG Relevance Scores are not
inputs in the rating process; they are an observation on the
relevance and materiality of ESG factors in the rating decision.
Entity/Debt Rating
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TBC Insurance JSC LT IDR BB New Rating
LT IFS BB New Rating
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G E R M A N Y
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PFLEIDERER GROUP: S&P Upgrades ICR to 'CCC+', Outlook Stable
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S&P Global Ratings raised its rating on Germany-based wood panel
manufacturer Pfleiderer Group B.V. & Co. KG (Pfleiderer) to 'CCC+'
from 'SD' and at the same time, raised its issue rating on the
amended EUR750 million senior secured notes due 2029 to 'CCC+' from
'D'.
The stable outlook reflects S&P's view that liquidity will remain
sufficient in the next 12 months, despite our expectation of
negative generation of free operating cash flow (FOCF).
This restructuring removes near-term refinancing concerns. The
restructuring removed the existing refinancing risk by extending
the maturity of the notes and RCF (95% of the group's debt) to
2029. The maturity of the EUR350 million senior secured
floating-rate notes and the EUR400 million senior secured 4.75%
notes was extended to April 2029 from April 2026. The maturity of
the EUR65 million super senior RCF was amended to January 2029 from
October 2025.
The restructuring does not address the group's underlying
insufficient cash generation. It also leads to a higher debt burden
in the medium term. Although this amendment addressed the group's
refinancing needs, it did not address Pfleiderer's weak cash
generation, which S&P continues to deem as insufficient for the
group's high debt levels. S&P expects FOCF to remain negative over
2024-2026.
In return for their consent to this transaction, noteholders will
receive margin uplifts of 400 basis points (bps) for the 4.75% rate
notes and 75bps for the floating rate notes, as well as fees. Both
types of compensation will be non-cash payments and instead accrue,
increasing Pfleiderer's senior debt quantum by about 28% by 2029.
Liquidity is supported by the extension of the debt maturities and
Strategic Value Partnership's EUR75 million cash injection. The
extension of the maturity of the super senior RCF and the EUR75
million cash injection by the shareholder will support the group's
liquidity position. S&P said, "We believe that it will support the
group's capital spending (capex) and working capital plans in the
next 12 months. Despite this, and in light of Pfleiderer's subdued
cash generation, we believe that Pfleiderer remains vulnerable to
large, unexpected operating cash outflows from unforeseen movements
in working capital or input costs."
The stable outlook reflects S&P's expectation that liquidity will
remain sufficient in the next 12 months, despite its expectation of
negative FOCF generation.
S&P could lower the rating if:
-- Pfleiderer's liquidity deteriorated; or
-- S&P saw a heightened risk of default in the next 12 months due
to, for example, a deterioration of the group's standing in credit
markets, a potential covenant breach, or another distressed debt
restructuring.
An upgrade of Pfleiderer is unlikely in the next 12 months, given
S&P's expectation of negative FOCF. A positive rating action would
hinge on the company's ability to generate material positive FOCF
on a sustained basis.
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G R E E C E
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TITAN CEMENT: S&P Upgrades LT ICR to 'BB+', Outlook Stable
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S&P Global Ratings raised its long-term issuer credit rating on
Titan Cement to 'BB+' from 'BB' and affirmed the 'B' short-term
rating. At the same time, S&P raised its issue rating on Titan
Cement's senior unsecured debt to 'BB+' from 'BB', for which the
recovery rating remains '3' (65% estimated recovery in a default).
The stable outlook reflects S&P's view that, in 2024-2025, Titan
will maintain an adequate liquidity profile and sustain FFO to debt
well above 30%, which S&P views as commensurate with the 'BB+'
rating.
The upgrade reflects that the marked improvement in Titan Cement's
financial leverage over the past two years and that the group's
core metrics will likely strengthen further in 2024-2025. Strong
sales and margin improvements, combined with higher free operating
cash flow, enabled the group to materially reduce its financial
leverage reduction last year, with S&P Global Ratings-adjusted debt
to EBITDA dropping to 1.4x at year-end from 2.6x in 2022. Over the
same period, funds from operations (FFO) to debt improved to 57.0%
from 32.3%. S&P projects the company's profitability and cash flow
will remain resilient in 2024-2025. This would translate into
further additional credit metric improvements, notably adjusted
debt to EBITDA of 1.0x-1.5x and FFO to debt of 65%-70% in
2024-2025.
S&P said, "We expect that these strong operating results will
continue over 2024-2025. Titan Cement's reported exceptional
operating performance in 2023 included a 11.6% year-over-year
increase in revenue, exceeding our base-case expectation of
7.0%-9.0%. This was mostly driven by sustained high prices for
cement, alongside solid demand in key countries, especially in the
U.S. and Greece. Specifically, Titan Cement reported a sale
increase of 13% in the U.S. and 22% in Greece and Western Europe,
which accounted for about 58% and 16% of 2023 sales, respectively.
The group continued to report resilient results in the first half
of 2024, with sales up 7.6% compared with the same period in 2023.
We expect sales to increase 4%-5% over 2024-2025, pointing to our
projections of a softer-but-still-resilient growth. We assume the
increase will be mostly driven by a moderately positive pricing
environment and buoyant demand supported by some recovery in the
housing market. We also anticipate support from still-solid
infrastructure projects in the U.S. and Europe. Titan Cement's
profitability also improved materially in 2023, with S&P Global
Ratings-adjusted EBITDA margin reaching 21.6% from 14.9% in 2022.
This was primarily driven by effective pricing combined with lower
costs, mostly thanks to reduced energy prices and higher operating
leverage. We expect that Titan Cement's profitability will remain
strong at an EBITDA margin of about 22% in 2024-2025, on the back
of continued investments in operational efficiencies and
improvements in product mix, with a higher share of products having
lower clinker ratio.
"We expect the company's conservative financial policy to support
the rating. Titan Cement set a public leverage target between 1.5x
and 2.0x. This range is equivalent to adjusted debt to EBITDA of
between 1.7x and 2.2x and adjusted FFO to debt of 35%-45%, which
are in line with our 'BB+' rating. The company surpassed this
target in 2023 with reported net leverage at 1.2x (equivalent to
1.4x as adjusted by S&P Global Ratings), leaving room to finance
its decarbonization efforts.
"We think Titan Cement will take advantage of the current rating
headroom to finance capital expenditure (capex) and shareholder
remuneration. We project Titan Cement will generate free operating
cash flow (FOCF) of EUR170 million-EUR200 million in 2024-2025. We
also project EUR250 million-EUR260 million of capex, representing
9%-10% of sales, to finance efficiency improvements projects,
carbon reduction initiatives, and capacity expansion. This compares
with FOCF of EUR184 million and capex of EUR221 million in 2023.
Considering last year's ordinary dividend payment of about EUR45
million and share buyback of about EUR15 million, we expect that
the company will continue to distribute funds to shareholders,
resulting in a total cash outflow of EUR80 million-EUR90 million in
2024 and above EUR100 million in 2025. In our view, such actions
should not impair credit metrics, given our expectations of strong
EBITDA and cash flow. Moreover, we think that the group would
adjust to weaker-than-expected operating performance, if needed, by
postponing discretionary spending to protect its liquidity and
credit quality.
"We assume Titan Cement will maintain an adequate liquidity buffer
over the next 12 months, despite upcoming maturities. Although
Titan Cement still needs to address the refinancing of its EUR350
million bond maturing in November 2024, we project that the company
will have enough sources to cover its liquidity needs over the next
12 months. In response to the high interest rate environment, the
company has prioritized preserving cash flow by retaining debt
facilities with lower interest rates rather than initiating early
refinancing at the current higher rates, thus lowering the ratio of
liquidity sources over uses. As such, we expect that the company
will meet its refinancing needs thanks to its cash on balance sheet
and committed banks lines, which include a EUR230 million RCF and
EUR80 million of committed line from Greek banks. We also note that
the company can rely on other short-term or uncommitted lines that
we do not factor in our quantitative analysis, but we take into
account from a qualitative standpoint. For instance, Titan Cement
signed a term-loan of up to EUR120 million with Greek banks, with a
committed availability period until November 2024, which could
alleviate any unexpected temporary liquidity pressure.
"Our current analysis on Titan Cement does not factor in
implications from the listing of the U.S. operations. On May 9,
2024, Titan Cement announced its intention to list its North
American business on the U.S. stock exchange. Titan America
accounts for about 58% of the group's 2023 total revenue,
contributing for about EUR1.5 billion sales and EUR296 million
EBITDA. We understand that the transaction will consist of the IPO
of a minority stake (in the 15%-25% range) and will be completed
during the first quarter of 2025. We also understand that the
company intends to use the net proceeds from the transaction
primarily to finance growth projects. A sizable distribution of
those proceeds to shareholders could constrain the ratings.
However, at this time, we do not factor the transaction into our
base-case scenario--there is uncertainty around cost of listing,
funds allocation and amount of proceeds, as well as the financial
policy that the company will adopt for this part of the business.
We will assess the credit rating implications once we have more
details on the transaction.
"The stable outlook reflects our view that, over 2024-2025, Titan
Cement will maintain an adequate liquidity buffer and sustain FFO
to debt well above 30%, which we view as commensurate with the
'BB+' rating."
S&P could lower the rating if the group's FFO to debt dropped below
30%, with limited possibility of a swift recovery. Such a
deterioration of the group's leverage would most likely happen if:
-- Titan Cement pursued large debt-funded acquisitions, capital
investments, or shareholder distributions, which would signal a
lack of commitment to keep metrics commensurate with a higher
rating;
-- There is a weakening of the operating performance in key
countries that contribute to the group earnings, such as the U.S.,
and the group is not willing to reduce its discretionary spending
to protect credit metrics.
Rating pressure could also stem from a deterioration of Titan
Cement's liquidity.
S&P views the possibility for rating upside in the medium term as
unlikely considering the company's current financial policy, and
its expectation that some rating headroom will be used to finance
capex and shareholder remuneration. However, management commitment
to maintain FFO to debt comfortably above 45% and FOCF to debt
above 25% on a sustainable basis could provide rating upside.
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I R E L A N D
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AQUEDUCT 7-2022: Fitch Assigns 'B-sf' Final Rating to Cl. F-R Notes
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Fitch Ratings has assigned Aqueduct European CLO 7-2022 DAC reset
final ratings, as detailed below.
Entity/Debt Rating Prior
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Aqueduct European
CLO 7-2022 DAC
A Loan-R LT AAAsf New Rating
A Notes-R XS2866432649 LT AAAsf New Rating
A-Loan LT PIFsf Paid In Full AAAsf
A-Notes XS2448041108 LT PIFsf Paid In Full AAAsf
B-1 XS2448041876 LT PIFsf Paid In Full AAsf
B-2 XS2448042767 LT PIFsf Paid In Full AAsf
B-R XS2866432995 LT AAsf New Rating
C XS2448043492 LT PIFsf Paid In Full Asf
C-R XS2866433290 LT Asf New Rating
D XS2448043658 LT PIFsf Paid In Full BBB-sf
D-R XS2866433613 LT BBB-sf New Rating
E XS2448044896 LT PIFsf Paid In Full BB-sf
E-R XS2866434009 LT BB-sf New Rating
F XS2448044540 LT PIFsf Paid In Full B-sf
F-R XS2866434264 LT B-sf New Rating
Subordinated XS2871782392 LT NRsf New Rating
Z-1 XS2866434421 LT NRsf New Rating
Z-2 XS2866434777 LT NRsf New Rating
Z-3 XS2866434934 LT NRsf New Rating
Transaction Summary
Aqueduct European CLO 7-2022 DAC reset is a securitisation of
mainly senior secured obligations (at least 90%) with a component
of senior unsecured, mezzanine, second-lien loans and high-yield
bonds. Note proceeds have been used to fund a portfolio with a
target par of EUR300 million. The portfolio is actively managed by
HPS Investment Partners CLO (UK) LLP. The CLO has a 4.6-year
reinvestment period and a 7.5-year weighted average life test
(WAL).
KEY RATING DRIVERS
Average Portfolio Credit Quality (Neutral): Fitch considers the
average credit quality of obligors to be in the 'B'/'B-' category.
The Fitch weighted average rating factor of the identified
portfolio is 25.3.
High Recovery Expectations (Positive): At least 90% of the
portfolio comprises senior secured obligations. Fitch views the
recovery prospects for these assets as more favourable than for
second-lien, unsecured and mezzanine assets. The Fitch weighted
average recovery rate of the identified portfolio is 61.9%.
Diversified Asset Portfolio (Positive): The transaction also
includes various other concentration limits, including the maximum
exposure to the three largest Fitch-defined industries in the
portfolio at 40%. These covenants ensure that the asset portfolio
will not be exposed to excessive concentration.
Portfolio Management (Neutral): The transaction has four matrices;
two effective at closing with fixed-rate limits of 7.5% and 10%,
and two one year post-closing (or two years if the WAL steps up one
year post closing) with same fixed-rate limits. All four matrices
are based on a top-10 obligor concentration limit of 20%. The
closing matrices correspond to a 7.5-year WAL test while the
forward matrices correspond to a 6.5 year WAL test.
The transaction can step-up one year at one year after closing,
subject to all tests passing and the collateral principal amount
(defaults at lower of Fitch and another rating agency's collateral
value) is at least at the reinvestment target par balance. The
switch to the forward matrices is subject to the collateral
principal amount (defaults at Fitch collateral value) being at
least at the target par. The manager can switch to forward matrices
either one year post closing or two years post-closing if the WAL
is extended.
The transaction has reinvestment criteria governing the
reinvestment similar to those of other European transactions.
Fitch's analysis is based on a stressed-case portfolio with the aim
of testing the robustness of the transaction structure against its
covenants and portfolio guidelines.
Cash-flow Modelling (Positive): The WAL used for the transaction's
stress portfolio analysis is 12 months less than the WAL covenant
at the issue date (subject to a floor of six years), to account for
the strict reinvestment conditions envisaged by the transaction
after its reinvestment period. These include, among others, passing
the coverage tests and the Fitch 'CCC' bucket limit test post
reinvestment, as well as a WAL covenant that progressively steps
down over time, both before and after the end of the reinvestment
period. Fitch believes these conditions would reduce the effective
risk horizon of the portfolio during the stress period.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
A 25% increase of the mean default rate (RDR) across all ratings
and a 25% decrease of the recovery rate (RRR) across all ratings of
the identified portfolio would lead to downgrades of up to two
notches for the class B-R,C-R, D-R and E-R notes, to below 'B-sf'
for the class F-R notes and have no impact on the class A-R notes.
Based on the identified portfolio, downgrades may occur if the loss
expectation is larger than initially assumed, due to unexpectedly
high levels of default and portfolio deterioration. Due to the
better metrics and shorter life of the identified portfolio than
the Fitch-stressed portfolio, the class B-R to F-R notes have a
rating cushion of up to two notches.
Should the cushion between the identified portfolio and the
Fitch-stressed portfolio be eroded due to manager trading or
negative portfolio credit migration, a 25% increase of the mean RDR
across all ratings and a 25% decrease of the RRR across all ratings
of the Fitch-stressed portfolio would lead to downgrades of up to
four notches for the notes.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
A 25% reduction of the mean RDR across all ratings and a 25%
increase in the RRR across all ratings of the Fitch-stressed
portfolio would lead to upgrades of up to three notches, except for
the 'AAAsf' rated notes, which are at the highest level on Fitch's
scale and cannot be upgraded.
During the reinvestment period, based on the Fitch-stressed
portfolio, upgrades may occur on better-than-expected portfolio
credit quality and a shorter remaining WAL test, allowing the notes
to withstand larger-than-expected losses for the transaction's
remaining life. After the end of the reinvestment period, upgrades
may result from stable portfolio credit quality and deleveraging,
leading to higher credit enhancement and excess spread available to
cover losses in the remaining portfolio.
USE OF THIRD PARTY DUE DILIGENCE PURSUANT TO SEC RULE 17G -10
Form ABS Due Diligence-15E was not provided to, or reviewed by,
Fitch in relation to this rating action.
DATA ADEQUACY
Aqueduct European CLO 7-2022 DAC
Fitch has checked the consistency and plausibility of the
information it has received about the performance of the asset pool
and the transaction. Fitch has not reviewed the results of any
third party assessment of the asset portfolio information or
conducted a review of origination files as part of its ongoing
monitoring.
The majority of the underlying assets or risk presenting entities
have ratings or credit opinions from Fitch and/or other Nationally
Recognized Statistical Rating Organizations and/or European
Securities and Markets Authority registered rating agencies. Fitch
has relied on the practices of the relevant groups within Fitch
and/or other rating agencies to assess the asset portfolio
information or information on the risk presenting entities.
Overall, and together with any assumptions referred to above,
Fitch's assessment of the information relied upon for the agency's
rating analysis according to its applicable rating methodologies
indicates that it is adequately reliable.
ESG CONSIDERATIONS
Fitch does not provide ESG relevance scores for Aqueduct European
CLO 7-2022 DAC. In cases where Fitch does not provide ESG relevance
scores in connection with the credit rating of a transaction,
programme, instrument or issuer, Fitch will disclose in the key
rating drivers any ESG factor which has a significant impact on the
rating on an individual basis.
ARBOUR CLO XIII: Fitch Assigns 'B-sf' Final Rating to Class F Notes
-------------------------------------------------------------------
Fitch Ratings has assigned Arbour CLO XIII DAC final ratings, as
detailed below.
Entity/Debt Rating
----------- ------
Arbour CLO XIII DAC
Class A LT AAAsf New Rating
Class B LT AAsf New Rating
Class C LT Asf New Rating
Class D LT BBB-sf New Rating
Class E LT BB-sf New Rating
Class F LT B-sf New Rating
Class M LT NRsf New Rating
Subordinated Notes LT NRsf New Rating
Transaction Summary
Arbour CLO XIII DAC is a securitisation of mainly senior secured
obligations (at least 90%) with a component of senior unsecured,
mezzanine, second-lien loans and high-yield bonds. Note proceeds
have been used to fund a portfolio with a target par of EUR400
million. The portfolio is actively managed by Oaktree Capital
Management (UK) LLP. The CLO has a 4.5-year reinvestment period and
an 8.5-year weighted average life (WAL) test at closing.
KEY RATING DRIVERS
Average Portfolio Credit Quality (Neutral): Fitch places the
average credit quality of obligors at 'B'. The Fitch weighted
average rating factor of the identified portfolio is 24.
High Recovery Expectations (Positive): At least 90% of the
portfolio comprises senior secured obligations. Fitch views the
recovery prospects for these assets as more favourable than for
second-lien, unsecured and mezzanine assets. The Fitch weighted
average recovery rate of the identified portfolio is 63.2%.
Diversified Asset Portfolio (Positive): The closing matrix and
forward matrix are based on a 10 largest obligor limit of 20% of
the portfolio balance and fixed-rate asset limits of 5% and 10%.
The manager can elect the forward matrix at any time one year after
closing if the aggregate collateral balance (with defaulted
obligations at their Fitch-calculated collateral value) is at least
above the reinvestment target par amount.
The transaction also includes various concentration limits,
including a maximum exposure to the three largest Fitch-defined
industries in the portfolio at 40%. These covenants ensure the
asset portfolio will not be exposed to excessive concentration.
Portfolio Management (Neutral): The transaction has a 4.5-year
reinvestment period, which is governed by reinvestment criteria
that are similar to those of other European transactions. Fitch's
analysis is based on a stressed-case portfolio with the aim of
testing the robustness of the transaction structure against its
covenants and portfolio guidelines.
Cash Flow Modelling (Positive): The WAL used for the Fitch-stressed
portfolio analysis was reduced by 12 months. This is to account for
the strict reinvestment conditions envisaged after the reinvestment
period. These include passing the coverage tests and the Fitch
'CCC' maximum limit after reinvestment and a WAL covenant that
progressively steps down over time after the end of the
reinvestment period. In Fitch's opinion, these conditions would
reduce the effective risk horizon of the portfolio during stress
periods.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
A 25% increase of the mean default rate (RDR) across all ratings
and a 25% decrease of the recovery rate (RRR) across all ratings of
the identified portfolio would have no impact on the notes.
Based on the identified portfolio, downgrades may occur if the loss
expectation is larger than initially assumed, due to unexpectedly
high levels of default and portfolio deterioration. Due to the
better metrics and shorter life of the identified portfolio than
the Fitch-stressed portfolio, the class B notes have a rating
cushion of two notches, the class C and D notes four notches, the
class E notes three notches and the class F notes five notches. The
class A notes have no rating cushion.
Should the cushion between the identified portfolio and the
Fitch-stressed portfolio be eroded due to manager trading or
negative portfolio credit migration, a 25% increase of the mean RDR
across all ratings and a 25% decrease of the RRR across all ratings
of the Fitch-stressed portfolio would lead to downgrades of up to
four notches for the notes, except for class E and F notes, which
would be downgraded below 'B-sf'.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
A 25% reduction of the mean RDR across all ratings and a 25%
increase in the RRR across all ratings of the Fitch-stressed
portfolio would lead to upgrades of up to three notches, except for
the 'AAAsf' notes, which are at the highest level on Fitch's scale
and cannot be upgraded.
During the reinvestment period, based on the Fitch-stressed
portfolio, upgrades may occur on better-than-expected portfolio
credit quality and a shorter remaining WAL test, allowing the notes
to withstand larger-than-expected losses for the transaction's
remaining life. After the end of the reinvestment period, upgrades
may result from stable portfolio credit quality and deleveraging,
leading to higher credit enhancement and excess spread available to
cover losses in the remaining portfolio.
USE OF THIRD PARTY DUE DILIGENCE PURSUANT TO SEC RULE 17G -10
Form ABS Due Diligence-15E was not provided to, or reviewed by,
Fitch in relation to this rating action.
DATA ADEQUACY
Arbour CLO XIII DAC
The majority of the underlying assets or risk presenting entities
have ratings or credit opinions from Fitch and/or other Nationally
Recognized Statistical Rating Organizations and/or European
Securities and Markets Authority registered rating agencies. Fitch
has relied on the practices of the relevant groups within Fitch
and/or other rating agencies to assess the asset portfolio
information or information on the risk presenting entities.
Overall, and together with any assumptions referred to above,
Fitch's assessment of the information relied upon for the agency's
rating analysis according to its applicable rating methodologies
indicates that it is adequately reliable.
ESG CONSIDERATIONS
Fitch does not provide ESG relevance scores for Arbour CLO XIII
DAC. In cases where Fitch does not provide ESG relevance scores in
connection with the credit rating of a transaction, programme,
instrument or issuer, Fitch will disclose in the key rating drivers
any ESG factor which has a significant impact on the rating on an
individual basis.
BAIN CAPITAL 2018-2: Fitch Hikes Class E Notes Rating to 'BB+sf'
----------------------------------------------------------------
Fitch Ratings has upgraded Bain Capital Euro CLO 2018-2 DAC's class
B-1-R, class B-2-R and class E notes while affirming the rest.
Entity/Debt Rating Prior
----------- ------ -----
Bain Capital Euro
CLO 2018-2 DAC
A-R XS2326485898 LT AAAsf Affirmed AAAsf
B-1-R XS2326486516 LT AAAsf Upgrade AA+sf
B-2-R XS2326487167 LT AAAsf Upgrade AA+sf
C XS1890841452 LT A+sf Affirmed A+sf
D XS1890840058 LT BBB+sf Affirmed BBB+sf
E XS1890842930 LT BB+sf Upgrade BBsf
F XS1890843235 LT B-sf Affirmed B-sf
Transaction Summary
Bain Capital Euro CLO 2018-2 DAC is a cash flow CLO mostly
comprising senior secured obligations. The transaction is actively
managed by Bain Capital Credit, Ltd., exited its reinvestment
period in January 2023 and has begun to pay down its class A-R
notes.
KEY RATING DRIVERS
Amortisation Benefits Senior Notes: The transaction is continuing
to deleverage with the class A-R notes having paid down by about
EUR33.3 million since the last review in November 2023. The
amortisation has resulted in an increase in credit enhancement for
the class B-1-R, B-2-R and E notes and, consequently, their upgrade
today.
Par Erosion but Limited Losses: The transaction is currently about
2% below target par. The par erosion is due partly to EUR2.1
million reported defaults in the portfolio. Exposure to assets with
a Fitch-derived rating of 'CCC+' and below is 8.1%, according to
the trustee report as of 6 August 2024, versus a limit of 7.5%.
'B'/'B-' Portfolio: Fitch assesses the average credit quality of
the transaction's underlying obligors at 'B'/'B-'. The
weighted-average rating factor (WARF), as calculated by Fitch under
its latest criteria, is 25.6.
High Recovery Expectations: Senior secured obligations comprise
98.8% of the portfolio. Fitch views the recovery prospects for
these assets as more favourable than for second-lien, unsecured and
mezzanine assets. The Fitch-calculated weighted average recovery
rate (WARR) of the current portfolio is 63.9% as reported in the
latest trustee report.
Diversified Portfolio: The portfolio is well-diversified across
obligors, countries and industries. The top 10 obligor
concentration, as calculated by Fitch, is 13.1%, and the largest
obligor represents 1.7% of the portfolio balance. Exposure to the
three largest Fitch-defined industries is 29.3% as calculated by
the trustee. Fixed-rate assets reported by the trustee are 9.3% of
the portfolio balance, versus a limit of 10%.
Transaction Outside Reinvestment Period: The transaction is failing
Fitch's 'CCC' test and another credit rating agency's Caa test,
hence restricting reinvestment outside its reinvestment period. It
is also failing its weighted average life (WAL) test.
If the failing 'CCC' and 'Caa' tests are cured, the manager would
be able to reinvest unscheduled principal proceeds and sale
proceeds from credit-improved or credit-impaired obligations.
Fitch's analysis is therefore based on a portfolio where Fitch
stresses the transaction's covenants to their limits. The WARR has
been reduced by 1.5% to address the inflated WARR, as the
transaction document used an old WARR definition that is not in
line with Fitch's current criteria.
Cash Flow Analysis: Fitch used a customised proprietary cash flow
model to replicate the principal and interest waterfalls and the
various structural features of the transaction, and to assess their
effectiveness, including the structural protection provided by
excess spread diverted through the par-value and interest-coverage
tests.
Deviation from Model-implied Ratings: The class F notes are one
notch below their model-implied rating (MIR). The deviation
reflects limited default-rate cushion at their MIR under the
Fitch-stressed portfolio and the junior notes sensitivity to
deterioration as the transaction amortises.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
Based on the current portfolio, downgrades may occur if the loss
expectation is larger than initially assumed, due to unexpectedly
high levels of default and portfolio deterioration.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
Upgrades may result from stable portfolio credit quality and
deleveraging, leading to higher credit enhancement and excess
spread available to cover losses in the remaining portfolio.
USE OF THIRD PARTY DUE DILIGENCE PURSUANT TO SEC RULE 17G -10
Form ABS Due Diligence-15E was not provided to, or reviewed by,
Fitch in relation to this rating action.
DATA ADEQUACY
Fitch has checked the consistency and plausibility of the
information it has received about the performance of the asset pool
and the transaction. Fitch has not reviewed the results of any
third-party assessment of the asset portfolio information or
conducted a review of origination files as part of its ongoing
monitoring.
The majority of the underlying assets or risk-presenting entities
have ratings or credit opinions from Fitch and/or other nationally
recognised statistical rating organisations and/or European
securities and markets authority-registered rating agencies. Fitch
has relied on the practices of the relevant groups within Fitch
and/or other rating agencies to assess the asset portfolio
information or information on the risk-presenting entities.
Overall, and together with any assumptions referred to above,
Fitch's assessment of the information relied upon for the agency's
rating analysis according to its applicable rating methodologies
indicates that it is adequately reliable.
ESG CONSIDERATIONS
Fitch does not provide ESG relevance scores for Bain Capital Euro
CLO 2018-2 DAC. In cases where Fitch does not provide ESG relevance
scores in connection with the credit rating of a transaction,
programme, instrument or issuer, Fitch will disclose in the key
rating drivers any ESG factor which has a significant impact on the
rating on an individual basis.
CAIRN CLO X: Fitch Hikes Rating on Class F Notes to 'B+sf'
----------------------------------------------------------
Fitch Ratings has upgraded Cairn CLO X DAC's class B, C, E, and F
notes and affirmed the rest.
Entity/Debt Rating Prior
----------- ------ -----
Cairn CLO X DAC
A-R XS2350603374 LT AAAsf Affirmed AAAsf
B-1-R XS2350603960 LT AA+sf Upgrade AAsf
B-2-R XS2350604422 LT AA+sf Upgrade AAsf
C-1-R XS2350605239 LT A+sf Upgrade Asf
C-2-R XS2350605742 LT A+sf Upgrade Asf
D-R XS2350606633 LT BBB+sf Affirmed BBB+sf
E XS1880994246 LT BB+sf Upgrade BBsf
F XS1880994329 LT B+sf Upgrade Bsf
Transaction Summary
Cairn CLO X DAC is a cash flow collateralised loan obligation
(CLO). The underlying portfolio of assets mainly consists of
leveraged loans and is managed by Cairn Loan Investments, LLP. The
deal exited its reinvestment period in April 2023.
KEY RATING DRIVERS
Stable Performance; Losses Below Expectation: As of July 2024, the
transaction was passing all of its tests. It has one reported
default, representing around 0.8% of the asset balance. Exposure to
assets with a Fitch-derived rating of 'CCC+' and below was close to
6.2%, according to the July trustee report, within the 7.5% limit.
The portfolio is slightly below its target par by approximately
0.3%, but losses are well below rating-case assumptions.
Manageable Refinancing Risk: The transaction has manageable
refinancing risk with about 17% of assets maturing within two
years. Comfortable default-rate cushion at each note's current
rating support the Stable Outlook.
'B'/'B-' Portfolio: Fitch assesses the average credit quality of
the obligors at 'B'/'B-'. The weighted average rating factor of the
current portfolio, as calculated by Fitch under its latest
criteria, is 26.4.
High Recovery Expectations: Senior secured obligations comprise
almost 100% of the portfolio. Fitch views the recovery prospects
for these assets as more favourable than for second-lien, unsecured
and mezzanine assets. The weighted average recovery rate (WARR) of
the current portfolio, as calculated by Fitch under its latest
criteria, is 61.1%.
Diversified Portfolio: The portfolio remains diversified across
obligors, countries and industries. No single obligor represents
more than 2.0% of the portfolio balance, and exposure to the
three-largest Fitch-defined industries is 29.7% as calculated by
the trustee.
Reinvesting Transaction: The manager can still reinvest unscheduled
principal proceeds and sale proceeds from credit-improved and
credit risk obligations after the reinvestment period, subject to
compliance with the reinvestment criteria. As of the monthly report
in July 2024, the transaction was passing all the relevant tests.
Given the manager's ability to reinvest, Fitch's analysis is based
on a stressed portfolio, using its matrices specified in the
transaction documents, corresponding to top 10 obligor limits of
17.5% and 27.5%.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
Based on the current portfolio, downgrades may occur if the loss
expectation is larger than assumed owing to unexpectedly high
levels of default and portfolio deterioration.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
Upgrades may result from stable portfolio credit quality and
deleveraging, leading to higher credit enhancement and excess
spread to cover losses in the remaining portfolio.
USE OF THIRD PARTY DUE DILIGENCE PURSUANT TO SEC RULE 17G -10
Form ABS Due Diligence-15E was not provided to, or reviewed by,
Fitch in relation to this rating action.
DATA ADEQUACY
Fitch has checked the consistency and plausibility of the
information it has received about the performance of the asset pool
and the transaction. Fitch has not reviewed the results of any
third-party assessment of the asset portfolio information or
conducted a review of origination files as part of its ongoing
monitoring.
The majority of the underlying assets or risk-presenting entities
have ratings or credit opinions from Fitch and/or other nationally
recognised statistical rating organisations and/or European
securities and markets authority-registered rating agencies. Fitch
has relied on the practices of the relevant groups within Fitch
and/or other rating agencies to assess the asset portfolio
information or information on the risk-presenting entities.
Overall, and together with any assumptions referred to above,
Fitch's assessment of the information relied upon for the agency's
rating analysis according to its applicable rating methodologies
indicates that it is adequately reliable.
ESG CONSIDERATIONS
Fitch does not provide ESG relevance scores for Cairn CLO X DAC. In
cases where Fitch does not provide ESG relevance scores in
connection with the credit rating of a transaction, programme,
instrument or issuer, Fitch will disclose in the key rating drivers
any ESG factor which has a significant impact on the rating on an
individual basis.
DRYDEN 62: Fitch Affirms 'B+sf' Rating on Cl. F Notes
-----------------------------------------------------
Fitch Ratings has upgraded Dryden 62 Euro CLO 2017 DAC's class B to
D notes, and affirmed the rest as detailed below.
Entity/Debt Rating Prior
----------- ------ -----
Dryden 62 Euro
CLO 2017 DAC
A XS1826185438 LT AAAsf Affirmed AAAsf
B XS1826185784 LT AAAsf Upgrade AA+sf
C XS1826186089 LT AA-sf Upgrade A+sf
D XS1826186592 LT A-sf Upgrade BBB+sf
E XS1826186832 LT BB+sf Affirmed BB+sf
F XS1826186758 LT B+sf Affirmed B+sf
Transaction Summary
Dryden 62 Euro CLO 2017 DAC is a cash flow CLO comprising mostly
senior secured obligations. The transaction is actively managed by
PGIM Limited and exited its reinvestment period in January 2023.
KEY RATING DRIVERS
Deleveraging Increases Credit Enhancement: Since Fitch's last
rating action in September 2023, the transaction has repaid
approximately EUR69 million of the class A notes, in turn
increasing credit enhancement (CE) for the class A to D notes. This
has outweighed an increase in par losses since the last review and
supports the upgrade of the class B to D notes.
Senior Notes Refinancing Risk Mitigated: The transaction has 19% of
assets maturing within two years. The comfortable default-rate
cushion of the class A to D notes mitigates refinancing risk and
support the Stable Outlook of these notes.
Junior Notes Refinancing Risk: Further par losses since the last
review have offset amortisation benefits for the junior notes,
resulting in their lower CE. The transaction had EUR8.8 million
reported defaults as of 30 July 2024 and is about 3% below target
par based on the aggregate collateral balance (defaults at
collateral value). However, losses are still within the rating-case
assumptions for the junior notes and therefore support the
affirmation of the notes.
The Negative Outlook on the junior notes indicates the possibility
of rating downgrade should further losses erode the default-rate
cushion, but Fitch expects ratings to remain within the current
rating category.
'B+'/'B' Portfolio: Fitch assesses the average credit quality of
the underlying obligors at 'B+'/'B'. The weighted average rating
factor (WARF) of the current portfolio is 23.2 as calculated by
Fitch under its latest criteria. For the portfolio including
entities with Negative Outlooks that are notched down one level,
the WARF was 24.7 as of 27 June 2024. Exposure to assets with a
Fitch-derived rating of 'CCC+' and below is 3.2%, according to the
trustee, versus a limit of 7.5%.
High Recovery Expectations: The transaction reports senior secured
obligations excluding cash at 75.3% of the portfolio. Including its
EUR70 million cash balance, it takes the senior secured share to
90.4%. Fitch views recovery prospects for these assets as more
favourable than for second-lien, unsecured and mezzanine assets.
The Fitch-calculated weighted average recovery rate (WARR) of the
current portfolio is 59.2% based on the current criteria.
Diversified Portfolio: The portfolio is well-diversified across
obligors, countries and industries. The top 10 obligor
concentration, as calculated by Fitch, is 24.1%, and no obligor
represents more than 3.5% of the portfolio balance. Exposure to the
three-largest Fitch-defined industries is 21.7% as calculated by
the trustee. Fixed-rate assets reported by the trustee are 19.4% of
the portfolio balance, which is below the current limit of 20%
Transaction Outside Reinvestment Period: Although the transaction
exited its reinvestment period in January 2023, the manager can
reinvest unscheduled principal proceeds and sale proceeds from
credit-improved or credit-impaired obligations, subject to
compliance with the reinvestment criteria. Currently, the
transaction is failing its weighted average life test and the
maximum senior secured obligations limit but the manager can
reinvest on a maintained/improved basis.
Given the manager's ability to reinvest, Fitch's analysis is based
on a portfolio where Fitch stresses the transaction's covenants to
their limits. The WARR has been reduced by 1.5% to address the
inflated WARR, as the transaction documentation uses an old WARR
definition that is not in line with Fitch's current criteria.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
Based on the current portfolio, downgrades may occur if the loss
expectation is larger than initially assumed, due to unexpectedly
high levels of default and portfolio deterioration.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
Upgrades may result from stable portfolio credit quality and
deleveraging, leading to higher CE and excess spread available to
cover losses in the remaining portfolio.
USE OF THIRD PARTY DUE DILIGENCE PURSUANT TO SEC RULE 17G -10
Form ABS Due Diligence-15E was not provided to, or reviewed by,
Fitch in relation to this rating action.
DATA ADEQUACY
Fitch has checked the consistency and plausibility of the
information it has received about the performance of the asset pool
and the transaction. Fitch has not reviewed the results of any
third-party assessment of the asset portfolio information or
conducted a review of origination files as part of its ongoing
monitoring.
The majority of the underlying assets or risk-presenting entities
have ratings or credit opinions from Fitch and/or other nationally
recognised statistical rating organisations and/or European
securities and markets authority-registered rating agencies. Fitch
has relied on the practices of the relevant groups within Fitch
and/or other rating agencies to assess the asset portfolio
information or information on the risk-presenting entities.
Overall, and together with any assumptions referred to above,
Fitch's assessment of the information relied upon for the agency's
rating analysis according to its applicable rating methodologies
indicates that it is adequately reliable.
ESG CONSIDERATIONS
Fitch does not provide ESG relevance scores for Dryden 62 Euro CLO
2017 DAC. In cases where Fitch does not provide ESG relevance
scores in connection with the credit rating of a transaction,
programme, instrument or issuer, Fitch will disclose in the key
rating drivers any ESG factor which has a significant impact on the
rating on an individual basis.
HENLEY CLO VII: S&P Assigns B- (sf) Rating on Class F-R Notes
-------------------------------------------------------------
S&P Global Ratings assigned its credit ratings to Henley CLO VII
DAC's class A-R, B-1-R, C-R, D-R, E-R, and F-R notes. At the same
time, S&P withdrew its ratings on the existing class A, B-1, C, D,
E, and F notes, and S&P affirmed its rating on the existing class
B-2 notes. At closing, the issuer had unrated subordinated notes
outstanding from the existing transaction.
On Aug. 21, 2024, the issuer refinanced the original class A, B-1,
C, D, E, and F notes by issuing replacement debt of the same
notional.
The replacement debt is largely subject to the same terms and
conditions as the original debt, except that the replacement debt
will have a lower spread over Euro Interbank Offered Rate (EURIBOR)
than the original debt.
The ratings reflect S&P's assessment of:
-- The diversified collateral pool, which primarily comprises
broadly syndicated speculative-grade senior secured term loans and
bonds that are governed by collateral quality tests.
-- The credit enhancement provided through the subordination of
cash flows, excess spread, and overcollateralization.
-- The collateral manager's experienced team, which can affect the
performance of the rated debt through collateral selection, ongoing
portfolio management, and trading.
-- The transaction's legal structure, which is bankruptcy remote.
-- The transaction's counterparty risks, which are in line with
S&P's counterparty rating framework.
Portfolio benchmarks
S&P Global Ratings' weighted-average rating factor 2,869.23
Default rate dispersion 390.76
Weighted-average life (years) 4.35
Obligor diversity measure 119.86
Industry diversity measure 17.66
Regional diversity measure 1.16
Transaction key metrics
Portfolio weighted-average rating
derived from S&P's CDO evaluator B
'CCC' category rated assets (%) 0.64
Actual 'AAA' weighted-average recovery (%) 36.68
Actual weighted-average spread (net of floors; %) 4.04
Actual weighted-average coupon (%) 5.38
Rating rationale
Under the transaction documents, the rated notes will pay quarterly
interest unless a frequency switch event occurs. Following this,
the notes will switch to semiannual payments.
The portfolio's reinvestment period will end in April 2025.
The portfolio is well-diversified, primarily comprising broadly
syndicated speculative-grade senior secured term loans and senior
secured bonds. Therefore, S&P has conducted its credit and cash
flow analysis by applying its criteria for corporate cash flow
CDOs.
S&P said, "In our cash flow analysis, we used a EUR396.72 million
target par collateral principal amount, the portfolio's actual
weighted-average spread (4.04%), actual weighted-average coupon
(5.38%), and actual weighted-average recovery rates at each rating
level.
"We applied various cash flow stress scenarios, using four
different default patterns, in conjunction with different interest
rate stress scenarios for each liability rating category.
"The transaction's documented counterparty replacement and remedy
mechanisms adequately mitigate its exposure to counterparty risk
under our current counterparty criteria.
"Under our structured finance sovereign risk criteria, we consider
that the transaction's exposure to country risk is sufficiently
mitigated at the assigned ratings.
"The transaction's legal structure and framework is bankruptcy
remote, in line with our legal criteria.
"Our credit and cash flow analysis indicates that the available
credit enhancement for the class B-1-R, B-2, C-R, D-R, and E-R
notes could withstand stresses commensurate with higher ratings
than those assigned. However, as the CLO is still in its
reinvestment phase, during which the transaction's credit risk
profile could deteriorate, we capped our assigned ratings on these
refinanced notes.
"For the class F-R notes, our credit and cash flow analysis
indicate that the available credit enhancement could withstand
stresses commensurate with a lower rating. However, we have applied
our 'CCC' rating criteria, resulting in a 'B- (sf)' rating on this
class of notes.
The ratings uplift for the class F-R notes reflects several key
factors, including:
-- The class F-R notes' available credit enhancement, which is in
the same range as that of other CLOs S&P has rated and that has
recently been issued in Europe.
-- The portfolio's average credit quality, which is similar to
other recent CLOs.
-- S&P's model generated break-even default rate (BDR) at the 'B-'
rating level of 20.96%, versus if it was to consider a long-term
sustainable default rate of 3.1% for 4.35 years, which would result
in a target default rate of 13.49%.
-- S&P does not believe that there is a one-in-two chance of this
tranche defaulting.
-- S&P does not envision this tranche defaulting in the next 12-18
months.
-- Following this analysis, S&P considers that the available
credit enhancement for the class F-R notes is commensurate with a
'B-' rating. S&P has therefore assigned a 'B- (sf)' rating to this
class of notes.
-- Following our analysis of the credit, cash flow, counterparty,
operational, and legal risks, S&P believes its ratings are
commensurate with the available credit enhancement for the class
A-R, B-1-R, B-2, C-R, D-R, E-R, and F-R notes.
S&P said, "In addition to our standard analysis, to provide an
indication of how rising pressures among speculative-grade
corporates could affect our ratings on European CLO transactions,
we have also included the sensitivity of the ratings on the class
A-R to E-R notes based on four hypothetical scenarios.
The transaction securitizes a portfolio of primarily senior secured
leveraged loans and bonds, and it is managed by Napier Park Global
Capital Ltd.
Environmental, social, and governance
S&P said, "We regard the transaction's exposure to environmental,
social, and governance (ESG) credit factors as broadly in line with
our benchmark for the sector. Primarily due to the diversity of the
assets within CLOs, the exposure to environmental credit factors is
viewed as below average, social credit factors are below average,
and governance credit factors are average."
Ratings
RATINGS ASSIGNED
REPLACEMENT ORIGINAL
NOTES NOTES CREDIT
AMOUNT INTEREST INTEREST ENHANCEMENT
CLASS RATING* (MIL. EUR) RATE§ RATE (%)
A-R AAA (sf) 232.00 3mE + 0.99% 3mE + 1.05% 41.52
B-1-R AA (sf) 33.90 3mE + 1.80% 3mE + 2.40% 27.40
C-R A (sf) 24.00 3mE + 2.10% 3mE + 3.15% 21.35
D-R BBB- (sf) 29.00 3mE + 3.00% 3mE + 4.25% 14.04
E-R BB- (sf) 18.80 3mE + 5.90% 3mE + 7.14% 9.31
F-R B- (sf) 12.20 3mE + 9.00% 3mE + 9.50% 6.23
RATING AFFIRMED
CLASS RATING* AMOUNT NOTES
(MIL. EUR) INTEREST RATE (%)§
B-2 AA (sf) 22.1 3.00
*The ratings assigned to the class A-R, B-2, and B-1-R notes
address timely interest and ultimate principal payments, and the
ratings assigned to the class C-R, D-R, E-R, and F-R notes address
ultimate interest and principal payments.
§The payment frequency switches to semiannual and the index
switches to 6mE when a frequency switch event occurs.
3mE--Three-month Euro Interbank Offered Rate.
OCP EURO 2024-10: Fitch Assigns 'B-sf' Final Rating to Cl. F Notes
------------------------------------------------------------------
Fitch Ratings has assigned OCP Euro CLO 2024-10 DAC's final
ratings, as detailed below.
Entity/Debt Rating Prior
----------- ------ -----
OCP Euro CLO 2024-10 DAC
Class A XS2854409989 LT AAAsf New Rating AAA(EXP)sf
Class B XS2854410136 LT AAsf New Rating AA(EXP)sf
Class C XS2854410300 LT Asf New Rating A(EXP)sf
Class D XS2854410565 LT BBB-sf New Rating BBB-(EXP)sf
Class E XS2854410722 LT BB-sf New Rating BB-(EXP)sf
Class F XS2854411027 LT B-sf New Rating B-(EXP)sf
Subordinated Notes
XS2854411704 LT NRsf New Rating NR(EXP)sf
Transaction Summary
OCP CLO 2024-10 DAC is a securitisation of mainly senior secured
obligations (at least 90%) with a component of senior unsecured,
mezzanine, second-lien loans and high-yield bonds. Note proceeds
have been used to fund the portfolio with a target par of EUR500
million.
The portfolio is actively managed by Onex Credit Partners Europe
LLP. The CLO has an approximately 4.7-year reinvestment period and
a nine-year weighted average life (WAL) test.
KEY RATING DRIVERS
Average Portfolio Credit Quality (Neutral): Fitch assesses the
average credit quality of obligors at 'B'/'B-'. The Fitch-weighted
average rating factor of the identified portfolio is 24.5.
High Recovery Expectations (Positive): At least 90% of the
portfolio comprises senior secured obligations. Fitch views the
recovery prospects for these assets as more favourable than for
second-lien, unsecured and mezzanine assets. The Fitch-weighted
average recovery rate of the identified portfolio is 62.55%.
Diversified Portfolio (Positive): The transaction includes four
Fitch test matrices, of which two are effective at closing. The
matrices correspond to a top-10 obligor concentration limit at 20%
and fixed-rate obligation limits at 5% and 12.5%. It has two
forward matrices corresponding to the same top-10 obligors and
fixed-rate asset limits, which will be effective 12 months after
closing, provided that the collateral principal amount (defaults at
Fitch-calculated collateral value) is at least at the reinvestment
target balance.
The transaction also includes various concentration limits,
including a maximum exposure to the three-largest Fitch-defined
industries at 40%. These covenants ensure the asset portfolio will
not be exposed to excessive concentration.
Portfolio Management (Neutral): The transaction has a 4.7-year
reinvestment period and includes reinvestment criteria similar to
those of other European transactions. Fitch's analysis is based on
a stressed-case portfolio with the aim of testing the robustness of
the transaction structure against its covenants and portfolio
guidelines.
Cash Flow Modelling (Positive): The WAL Fitch modelled is 12 months
less than the WAL covenant. This is to account for the strict
reinvestment conditions envisaged after the reinvestment period.
These include, among others, passing both the coverage tests and
the Fitch 'CCC' limit post reinvestment as well as a WAL covenant
that progressively steps down over time, both before and after the
end of the reinvestment period. Fitch believes these conditions
would reduce the effective risk horizon of the portfolio during the
stress period.
The Fitch 'CCC' test can be altered to a maintain-or-improve basis,
but only if the manager switches back to the closing matrix from
the forward matrix, effectively unwinding the benefit from the
one-year reduction in the Fitch-stressed portfolio WAL. If the
manager has not switched to the forward matrix, it will not be able
to switch back and move to a Fitch 'CCC' test maintain-or-improve
basis. Fitch believes strict satisfaction of the Fitch 'CCC' test
is more effective at preventing the manager from reinvesting and
extending the WAL, than maintaining and improving the Fitch 'CCC'
test.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
A 25% increase of the mean default rate (RDR) across all ratings
and a 25% decrease of the recovery rate (RRR) across all ratings of
the identified portfolio would have no impact on any of the notes.
Based on the identified portfolio, downgrades may occur if the loss
expectation is larger than initially assumed, due to unexpectedly
high levels of default and portfolio deterioration. Due to the
better metrics and shorter life of the identified portfolio than
the Fitch-stressed portfolio, the class B, D and E notes show a
rating cushion of two notches and the class C notes three notches.
The A notes have no rating cushion as they are at the highest
achievable rating of 'AAAsf'.
Should the cushion between the identified portfolio and the
Fitch-stressed portfolio be eroded due to manager trading or
negative portfolio credit migration, a 25% increase of the mean RDR
across all ratings and a 25% decrease of the RRR across all ratings
of the Fitch-stressed portfolio would lead to downgrades of up to
four notches.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
A 25% reduction of the mean RDR across all ratings and a 25%
increase in the RRR across all ratings of the Fitch-stressed
portfolio would lead to upgrades of up to three notches for the
notes, except for the 'AAAsf' rated notes, which are at the highest
level on Fitch's scale and cannot be upgraded.
During the reinvestment period, based on the Fitch-stressed
portfolio, upgrades may occur on better-than-expected portfolio
credit quality and a shorter remaining WAL test, meaning the notes
are able to withstand larger-than-expected losses for the
transaction's remaining life. After the end of the reinvestment
period, upgrades may result from stable portfolio credit quality
and deleveraging, leading to higher credit enhancement and excess
spread available to cover losses in the remaining portfolio.
USE OF THIRD PARTY DUE DILIGENCE PURSUANT TO SEC RULE 17G -10
Form ABS Due Diligence-15E was not provided to, or reviewed by,
Fitch in relation to this rating action.
DATA ADEQUACY
OCP Euro CLO 2024-10 DAC
The majority of the underlying assets or risk presenting entities
have ratings or credit opinions from Fitch and/or other Nationally
Recognized Statistical Rating Organizations and/or European
Securities and Markets Authority registered rating agencies. Fitch
has relied on the practices of the relevant groups within Fitch
and/or other rating agencies to assess the asset portfolio
information or information on the risk presenting entities.
Overall, and together with any assumptions referred to above,
Fitch's assessment of the information relied upon for the agency's
rating analysis according to its applicable rating methodologies
indicates that it is adequately reliable.
ESG CONSIDERATIONS
Fitch does not provide ESG relevance scores for OCP Euro CLO
2024-10 DAC. In cases where Fitch does not provide ESG relevance
scores in connection with the credit rating of a transaction,
programme, instrument or issuer, Fitch will disclose in the key
rating drivers any ESG factor which has a significant impact on the
rating on an individual basis.
OZLME III: S&P Affirms 'B- (sf)' Rating on Class F Notes
--------------------------------------------------------
S&P Global Ratings raised its credit ratings on OZLME III DAC's
class B-1 and B-2 notes to 'AAA (sf)' from 'AA+ (sf)', class C
notes to 'AA+ (sf)' from 'AA- (sf)', class D notes to 'A+ (sf)'
from 'A- (sf)', and class E notes to 'BB+ (sf)' from 'BB (sf)'. At
the same time, S&P affirmed its 'AAA (sf)' ratings on the class A-1
and A-2 notes and its 'B- (sf)' rating on the class F notes.
The rating actions follow the application of its global corporate
CLO criteria and S&P's credit and cash flow analysis of the
transaction based on the June and July 2024 monthly reports
S&P's ratings address timely payment of interest and ultimate
payment of principal on the class A-1, A-2, B-1, and B-2 notes, and
ultimate payment of interest and principal on the class C, D, E,
and F notes.
Since S&P reviewed the transaction in November 2023:
-- The portfolio's weighted-average rating is unchanged at 'B'.
-- The portfolio has become less diversified (the number of
performing obligors has decreased to 117 from 141) following the
amortization of the collateral pool.
-- The portfolio's weighted-average life has decreased to 3.17
years from 3.22 years.
-- The percentage of 'CCC' rated assets has decreased to 5.46%
from 5.74%.
While the portfolio's weighted-average life has decreased and
overall credit quality improved, the portfolio is now more
concentrated, leading to an average 37 basis points (bps) scenario
default rate (SDR) increase on all rating levels. Additionally,
recoveries have decreased by an average of 35 bps on all rating
levels.
Portfolio benchmarks
CURRENT NOVEMBER 2023 REVIEW
SPWARF 2,660.24 2,699.48
Default rate dispersion (%) 776.36 779.06
Weighted-average life (years) 3.24 3.22
Obligor diversity measure 82.19 99.09
Industry diversity measure 21.19 23.25
Regional diversity measure 1.25 1.26
SPWARF--S&P Global Ratings' weighted-average rating factor.
On the cash flow side:
-- The transaction's reinvestment period ended in February 2022.
While the class A-1 and A-2 notes have deleveraged in total by
EUR99.86 million since closing, the portfolio reduced by EUR103.96
million since closing, leading to a total par reduction of EUR4.09
million. Since our previous review, the transaction's liabilities
amortized by EUR194,000 more than the collateral pool.
-- No class of notes is deferring interest.
-- All coverage tests are passing as of the June and July 2024
trustee reports.
-- On the last two payment dates in 2024, the transaction has used
all of its principal proceeds to pay down its senior notes.
Transaction key metrics
NOVEMBER 2023
CURRENT REVIEW
Total collateral amount (mil. EUR)* 296.04 383.62
Defaulted assets (mil. EUR) 2.37 3.98
Number of performing obligors 117 141
Portfolio weighted-average rating B B
'CCC' assets (%) 5.46 5.74
'AAA' SDR (%) 53.74 53.40
'AAA' WARR (%) 38.37 38.40
*Performing assets plus cash and expected recoveries on defaulted
assets.
SDR--Scenario default rate.
WARR--Weighted-average recovery rate.
Credit enhancement
CURRENT
CURRENT (BASED ON THE JUNE NOVEMBER 2023
CLASS AMOUNT (EUR) 2024 TRUSTEE REPORT; %) REVIEW (%)
A-1 129,388,969.70 54.35 41.89
A-2 5,750,620.87 54.35 41.89
B-1 35,500,000.00 35.60 27.42
B-2 20,000,000.00 35.60 27.42
C 26,500,000.00 26.65 20.52
D 21,000,000.00 19.56 15.04
E 22,000,000.00 12.13 9.31
F 12,000,000.00 8.07 6.18
Sub 39,900,000.00 N/A N/A
Credit enhancement = [Performing balance + cash balance + recovery
on defaulted obligations (if any) – tranche balance (including
tranche balance of all senior tranches)]/ [Performing balance +
cash balance + recovery on defaulted obligations (if any)].
N/A--Not applicable.
S&P said, "In our view, the portfolio is diversified across
obligors, industries, and asset characteristics. The aggregate
exposure to the top 10 obligors is now 21.10%. Hence, we have
performed an additional scenario analysis by applying adjustments
for spread and recovery compression. At the same time,
approximately 27% of the assets pay semiannually. The CLO has a
smoothing account that helps to mitigate any frequency timing
mismatch risks.
"Based on the improved credit quality and continued deleveraging of
the senior notes--which has increased available credit
enhancement--we raised our ratings on the class B-1, B-2, C, D, and
E notes, as the available credit enhancement is now commensurate
with higher levels of stress.
"At the same time, we affirmed our ratings on the class A-1, A-2,
and F notes.
"The cash flow analysis indicated higher ratings than those
currently assigned for the class D and E notes (without the
above-mentioned additional sensitivity analysis). However, we have
considered that the manager may still reinvest unscheduled
redemption proceeds and sale proceeds from credit-improved assets.
Such reinvestments (as opposed to repayment of the liabilities),
may prolong the repayment profile for the most senior class of
notes. We also considered the portion of senior notes outstanding,
the current macroeconomic environment, and these classes'
seniority. Considering all of these factors, we raised our rating
on the class D notes by two notches and E notes by one notch.
"Counterparty, operational, and legal risks are adequately
mitigated in line with our criteria.
"Following the application of our structured finance sovereign risk
criteria, we consider the transaction's exposure to country risk to
be limited at the assigned ratings, as the exposure to individual
sovereigns does not exceed the diversification thresholds outlined
in our criteria."
RRE 21: S&P Assigns Prelim BB- (sf) Rating to Class D Notes
-----------------------------------------------------------
S&P Global Ratings assigned its preliminary credit ratings to RRE
21 Loan Management DAC's class A-1 to D notes. At closing, the
issuer will also issue unrated performance, preferred return, and
subordinated notes.
This is a European cash flow CLO transaction, securitizing a
portfolio of primarily senior secured leveraged loans and bonds.
The transaction will be managed by Redding Ridge Asset Management
(UK) LLP.
The preliminary ratings assigned to the notes reflect S&P's
assessment of:
-- The diversified collateral pool, which primarily comprises
broadly syndicated speculative-grade senior secured term loans and
bonds that are governed by collateral quality tests.
-- The credit enhancement provided through the subordination of
cash flows, excess spread, and overcollateralization.
-- The collateral manager's experienced team, which can affect the
performance of the rated notes through collateral selection,
ongoing portfolio management, and trading.
-- The transaction's legal structure, which S&P expects to be
bankruptcy remote.
-- The transaction's counterparty risks, which S&P expects to be
in line with its counterparty rating framework.
-- Under the transaction documents, the rated notes will pay
quarterly interest unless there is a frequency switch event.
Following this, the notes will permanently switch to semiannual
payment.
-- The portfolio's reinvestment period will end approximately 4.6
years after closing, and the portfolio's maximum average maturity
date is approximately 9.0 years after closing.
Portfolio benchmarks
CURRENT
S&P Global Ratings weighted-average rating factor 2,744.36
Default rate dispersion 497.42
Weighted-average life (years) 4.62
Obligor diversity measure 101.64
Industry diversity measure 20.61
Regional diversity measure 1.42
Transaction key metrics
CURRENT
Total par amount (mil. EUR) 400
Defaulted assets (mil. EUR) 0
Number of performing obligors 132
Portfolio weighted-average rating
derived from S&P's CDO evaluator B
'CCC' category rated assets (%) 0.86
Target 'AAA' weighted-average recovery (%) 37.79
Target portfolio weighted-average spread (%) 3.96
S&P said, "Our preliminary ratings reflect our assessment of the
preliminary collateral portfolio's credit quality, which has a
weighted-average rating of 'B'.
"We understand that at closing the portfolio will be
well-diversified, primarily comprising broadly syndicated
speculative-grade senior secured term loans and senior secured
bonds. Therefore, we have conducted our credit and cash flow
analysis by applying our criteria for corporate cash flow CDOs. As
such, we have not applied any additional scenario and sensitivity
analysis when assigning ratings to any class of notes in this
transaction.
"In our cash flow analysis, we used the EUR400 million target par
amount, the covenanted weighted-average spread (3.70%), and the
covenanted weighted-average coupon indicated by the collateral
manager (5.50%) and the covenanted portfolio weighted-average
recovery rates for all the rated notes. We applied various cash
flow stress scenarios, using four different default patterns, in
conjunction with different interest rate stress scenarios for each
liability rating category.
"Our credit and cash flow analysis indicates that the available
credit enhancement for the class A-2A to D notes could withstand
stresses commensurate with higher preliminary ratings than those
assigned. However, as the CLO will be in its reinvestment phase
starting from closing, during which the transaction's credit risk
profile could deteriorate, we have capped the assigned preliminary
ratings. The class A-1 notes can withstand stresses commensurate
with the assigned preliminary rating.
"At closing, we expect the transaction's documented counterparty
replacement and remedy mechanisms to adequately mitigate its
exposure to counterparty risk under our counterparty criteria.
"Following the application of our structured finance sovereign risk
criteria, we consider the transaction's exposure to country risk to
be limited at the assigned preliminary ratings, as the exposure to
individual sovereigns does not exceed the diversification
thresholds outlined in our criteria.
"At closing, we expect the transaction's legal structure to be
bankruptcy remote, in line with our legal criteria.
"Following our analysis of the credit, cash flow, counterparty,
operational, and legal risks, we believe that our assigned
preliminary ratings are commensurate with the available credit
enhancement for the class A-1, A-2A, A-2B, B, C-1, C-2, and D
notes.
"In addition to our standard analysis, we have also included the
sensitivity of the ratings on the class A-1 to D notes to four
hypothetical scenarios."
Environmental, social, and governance factors
S&P said, "We regard the exposure to environmental, social, and
governance (ESG) credit factors in the transaction as being broadly
in line with our benchmark for the sector. Primarily due to the
diversity of the assets within CLOs, the exposure to environmental
credit factors is viewed as below average, social credit factors
are below average, and governance credit factors are average. For
this transaction, the documents prohibit assets from being related
to certain industries, including, but not limited:
Thermal-coal-based power generation, mining or extraction; arctic
oil or gas production, and unconventional oil or gas production
from shale, tight reservoirs, or oil sands; production of civilian
weapons; development of nuclear weapon programs and production of
controversial weapons; management of private for-profit prisons;
tobacco or tobacco products; opioids; adult entertainment;
speculative transactions of soft commodities; predatory lending
practices; non-sustainable palm oil productions; animal testing for
non-pharmaceutical products; endangered species; and banned
pesticides or chemicals.
"Accordingly, since the exclusion of assets from these industries
does not result in material differences between the transaction and
our ESG benchmark for the sector, no specific adjustments have been
made in our rating analysis to account for any ESG-related risks or
opportunities."
Preliminary ratings
PRELIM.
PRELIM. AMOUNT CREDIT
CLASS RATING* (MIL. EUR) ENHANCEMENT (%) INTEREST RATE§
A-1 AAA (sf) 248.00 38.00 Three/six-month EURIBOR
plus 1.30%
A-2A AA (sf) 32.50 28.00 Three/six-month EURIBOR
plus 1.95%
A-2B AA (sf) 7.50 28.00 5.05%
B A (sf) 28.00 21.00 Three/six-month EURIBOR
plus 2.20%
C-1 BBB (sf) 24.00 15.00 Three/six-month EURIBOR
plus 3.20%
C-2 BBB- (sf) 4.00 14.00 Three/six-month EURIBOR
plus 4.60%
D BB- (sf) 15.20 10.20 Three/six-month EURIBOR
plus 6.15%
Performance
Notes NR 1.00 N/A N/A
Preferred
return notes NR 0.25 N/A N/A
Subordinated
Notes NR 47.00 N/A N/A
*The preliminary ratings assigned to the class A-1, A-2A, and A-2B
notes address timely interest and ultimate principal payments. The
ratings assigned to the class B, C-1, C-2, and D notes address
ultimate interest and principal payments.
§The payment frequency switches to semiannual and the index
switches to six-month EURIBOR when a frequency switch event occurs.
NR--Not rated.
N/A--Not applicable.
EURIBOR--Euro Interbank Offered Rate.
===========
T U R K E Y
===========
IZMIR METROPOLITAN: Fitch Affirms 'B+' LongTerm IDR, Outlook Stable
-------------------------------------------------------------------
Fitch Ratings has affirmed Izmir Metropolitan Municipality's
(Izmir) Long-Term Foreign and Local-Currency Issuer Default Ratings
(IDRs) at 'B+' with Positive Outlooks.
The rating affirmation reflects Fitch's expectations that Izmir's
operating performance will remain resilient, despite a highly
inflationary operating environment, further lira depreciation and
increases in debt-funded capex under Fitch's conservative rating
case.
Fitch has revised Izmir's Standalone Credit Profile (SCP) to 'bb'
from 'bb-' due to a higher-than-expected increase in VAT and
special consumption tax collections. Operating spending (opex)
growth lagging operating revenue growth in 2023 despite high
inflation led to an improved operating balance. This should help
support a payback ratio below 3x under its rating case and a debt
service coverage ratio (ADSCR) above 1.5x, which are commensurate
with a 'bb' category SCP. However, Izmir's IDRs are capped by the
Turkish sovereign ratings (B+/Positive).
KEY RATING DRIVERS
Risk Profile: 'Vulnerable'
Fitch sees a very high risk that Izmir's ability to cover debt
service with its operating balance may weaken unexpectedly over
2024-2028 due to lower-than-expected revenue, higher-than-projected
expenditure or an unforeseen rise in liabilities or debt-service
requirements.
Revenue Robustness: 'Midrange'
Izmir has a well-diversified and buoyant local economy, with GDP
per capita 19% above the national median, leading to a tax revenue
base with low volatility and robust tax revenue growth prospects.
This makes Izmir resilient to economic slowdown, which Fitch
expects to continue in 2024-2028. Taxes account for 79% of Izmir's
operating revenue, broadly aligning operating revenue growth with
Turkiye's nominal GDP growth. Fitch forecasts national GDP to grow
to TRY86.4 billion by 2028 from TRY25.2 billion in 2023, which
should enable Izmir to achieve robust operating margins of 35% on
average.
Revenue Adjustability: 'Weaker'
Izmir's ability to generate additional revenue is constrained by
nationally pre-defined tax rates. At end-2023, nationally set and
collected taxes comprised 78% of Izmir's total revenue. Local taxes
over which Izmir has autonomy were a low 0.4% of total revenue,
implying negligible tax flexibility. This is further constrained by
ceilings set by the central government. However, this is partly
compensated by financial equalisation transfers received by
metropolitan municipalities and fees and charges over which Izmir
has some control. These made up 13% and 8%, respectively, of its
total revenue in 2023.
Expenditure Sustainability: 'Weaker'
Moderately cyclical to countercyclical spending responsibilities
help Izmir to adapt spending to local economic cycles. However,
high inflation has led operating expenditure (CAGR 47.6%) to
increase at a faster pace than operating revenue (CAGR 41.6%) in
2019-2023. Fitch expects persistent high inflation to challenge
Izmir's control of operating expenditure, with increased pressure
coming from staff costs due to additional workforce employment, in
particular for the municipal companies.
High fuel prices are likely to pressure Izmir's operating
expenditure, especially for its a loss-making transportation
company, ESHOT. Fitch expects Izmir to provide large subsidies to
ESHOT, as cost increases cannot be fully reflected in fares.
Izmir's planned 19.3km Ucyol-Buca metro line will also challenge
its cost restraint amid high inflation. Fitch expects capex to
average 38% of total expenditure over the rating case. Fitch
expects recent cost-cutting measures by the central government and
expected decline in inflation from 2026 to help Izmir regain
control over expenditure growth.
Expenditure Adjustability: 'Midrange'
Izmir has a lower share of inflexible costs than its international
peers on average at less than 55% of total expenditure, which is
similar to its national peers.
Spending flexibility is offset by Izmir's weak record of balanced
budgets due to large swings in capex in pre-election periods and
its limited affordability for cuts amid poor level of services and
low investments. However, its budget has improved to a 0.1% surplus
of revenue in 2023, from a deficit before financing of 4.8% in 2022
and 7.4% in 2021. Fitch expects Izmir's spending flexibility to be
constrained by persistent high inflation and its capital-intensive
metro line investment, before it gradually improves from 2026 with
declining inflation.
Liabilities & Liquidity Robustness: 'Weaker'
Izmir faces significant foreign-exchange (FX) risk, as nearly 87%
of its total debt is in euros. Fitch expects FX volatility to
increase debt by roughly about 15% at end-2024. Izmir has about 20%
of its debt stock maturing each year to 2028. Annual debt-servicing
pressure is mitigated by the average life of its debt of 3.5 years,
the fully amortising nature of its bank loans and by its ADSCR
being on average at 2.0x. The majority of bank loans (67%) are
fixed-rate, resulting in negligible interest-rate risk. Izmir is
not exposed to material off-balance-sheet risk.
Liabilities & Liquidity Flexibility: 'Weaker'
Counterparty risk associated with Izmir's domestic liquidity
providers rated below 'BBB-' and the short tenor of its loans limit
its assessment to 'Weaker', similar to other Turkish local and
regional governments' (LRGs). Izmir's year-end cash remained
restricted as it is fully earmarked for payables settlement. Izmir
has good access to international financial markets. In 2024, it
attracted TRY3.7 billion in undrawn committed credit facilities
from national lenders. Turkish LRGs do not benefit from treasury
lines or cash-pooling, making it challenging to fund unexpected
increases in debt or spending.
Debt Sustainability: 'aaa category'
Under Fitch's conservative rating case, Izmir's operating margin
will decline to an average of 35% during 2024-2028 from 46% in
2019-2023, and its payback ratio will be below 5x, corresponding to
a 'aaa' debt sustainability (DS). The assessment is further
supported by robust debt-service coverage at 1.5x in 2028
corresponding to an 'a' DS and a low fiscal debt burden below 100%,
corresponding to a 'aa' DS.
Derivation Summary
Izmir's 'bb' SCP reflects a 'Vulnerable' risk profile and 'aaa' DS.
The SCP also factors in Izmir's comparison with its national and
international peers in the same rating category. Izmir's IDRs are
not affected by any other rating factors but are capped by the
Turkish sovereign's IDRs.
Short-Term Ratings
Izmir's 'B' Short-Term IDR is the only option for a 'B+' category
Long-Term IDR.
National Ratings
Izmir's 'AAA(tur)' Long-Term National Rating is derived from its
'B+' Long-Term Local-Currency IDR. The Outlook is Stable.
Izmir's National Long-Term Rating also reflects its budgetary
flexibility, benefiting from a valuable asset base that can be used
to generate additional liquidity in case of need and Izmir's good
access to financial markets.
Key Assumptions
Qualitative Assumptions:
Risk Profile: 'Vulnerable'
Revenue Robustness: 'Midrange'
Revenue Adjustability: 'Weaker'
Expenditure Sustainability: 'Weaker'
Expenditure Adjustability: 'Midrange'
Liabilities and Liquidity Robustness: 'Weaker'
Liabilities and Liquidity Flexibility: 'Weaker'
Debt sustainability: 'aaa'
Support (Budget Loans): 'N/A'
Support (Ad Hoc): 'N/A'
Asymmetric Risk: 'N/A'
Rating Cap (LT IDR): 'B+'
Rating Cap (LT LC IDR) 'B+'
Rating Floor: 'N/A'
Quantitative assumptions - Issuer Specific
Fitch's rating case is a "through-the-cycle" scenario, which
incorporates a combination of revenue, cost and financial risk
stresses. It is based on 2019-2023 published figures and 2024-2028
projected ratios. The key assumptions for the scenario include:
- Operating revenue CAGR of 27.9% in 2024-2028 (versus 41.6% year
on year for 2019-2023), due to expected high inflation of 30% on
average in 2024-2028
- Tax revenue CAGR of 27.6% in 2024-2028, versus 41.4% CAGR in
2019-2023
- Current transfers CAGR of 29.5% in 2024-2028, versus 44.2% CAGR
in 2019-2023
- Operating expenses CAGR of 33.5% in 2024-2028 (versus 47.6% year
on year for 2019-2023), due to expected high inflation of 30% on
average in 2024-2028
- Negative net capital balance of TRY26.6 billion in 2024-2028
- Apparent cost of debt on average at 10.6%, 4% above the average
cost of debt in 2023, due to higher borrowing rates
- US dollar/Turkish lira average exchange rate assumptions are
based on Fitch's sovereign estimates for 2024 at TRY36/USD, 2025 at
TRY40/USD, 2026 at TRY44/USD and with annual depreciation of 10% in
2027-2028
Liquidity and Debt Structure
Izmir's total debt increased to TRY16.8 billion in 2023 from
TRY10.7 billion in 2022, while its cash reserves (TRY1.9 billion)
are restricted and are fully earmarked for payables settlement.
This, together with other Fitch-classified debt (TRY38.5 million),
led to Izmir's net adjusted debt of TRY16.8 billion. The operating
balance was nearly TRY11.3 billion, or 45% of operating revenue,
leading to a robust payback ratio of 1.5x in 2023.
Izmir's contingent liabilities are moderate and mainly comprise the
liabilities of its water affiliate, IZSU (TRY3.0 billion) followed
by its railway company, IZBAN (TRY1.4 billion), which it jointly
owns with Turkish State Railways. IZSU is self-funding and has a
well-structured balance sheet. In 2023, IZSU's robust operating
performance led to a debt service coverage of 2.1x.
Fitch expects the municipality to spend on average TRY26.8 billion
annually on investments for the next five years, primarily on the
Ucyol-Buca metro line, followed by regular transportation
infrastructure, and rehabilitation of social and cultural
facilities. Fitch expects capex to be funded by a mix of borrowing
(mainly foreign-currency loans) and operating cash flow. Izmir's
payback ratio remains robust at 2.8x for 2028, underpinned by a
resilient operating balance.
Issuer Profile
Izmir is the third-largest city in Turkiye with 5.2% of the
national population. Izmir has a well-diversified and buoyant local
economy dominated by the services sector (53%), followed by
industry (42%) and agriculture (5%). Izmir's economy constitutes
6.5% of Turkiye's economic output.
Rating Sensitivities
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
A downgrade of the Turkish sovereign's IDRs or a downward revision
of Izmir's SCP resulting from a weaker debt payback of more than
nine years on a sustained basis would lead to a downgrade of
Izmir's IDRs.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
An upgrade of the Turkish sovereign IDRs would lead to a similar
action on Izmir's IDRs, provided that Izmir maintains its debt
payback ratio at below 5x without significant deterioration in
ADSCR and fiscal debt burden under its rating case.
ESG Considerations
The highest level of ESG credit relevance is a score of '3', unless
otherwise disclosed in this section. A score of '3' means ESG
issues are credit-neutral or have only a minimal credit impact on
the entity, either due to their nature or the way in which they are
being managed by the entity. Fitch's ESG Relevance Scores are not
inputs in the rating process; they are an observation on the
relevance and materiality of ESG factors in the rating decision.
Discussion Note
Committee date: 12 August 2024
There was an appropriate quorum at the committee and the members
confirmed that they were free from recusal. It was agreed that the
data was sufficiently robust relative to its materiality. During
the committee no material issues were raised that were not in the
original committee package. The main rating factors under the
relevant criteria were discussed by the committee members. The
rating decision as discussed in this rating action commentary
reflects the committee discussion.
Public Ratings with Credit Linkage to other ratings
Izmir's IDRs are capped by the Turkish sovereign IDRs.
Entity/Debt Rating Prior
----------- ------ -----
Izmir Metropolitan
Municipality LT IDR B+ Affirmed B+
ST IDR B Affirmed B
LC LT IDR B+ Affirmed B+
LC ST IDR B Affirmed B
Natl LT AAA(tur)Affirmed AAA(tur)
KONYA METROPOLITAN: Fitch Affirms 'B+' LongTerm IDR, Outlook Stable
-------------------------------------------------------------------
Fitch Ratings has affirmed Konya Metropolitan Municipality's
Long-Term Foreign- and Local-Currency Issuer Default Ratings (IDRs)
at 'B+'. The Outlook is Stable.
The affirmation reflects Fitch's view that Konya will maintain a
resilient operating balance despite high inflation and capex-driven
debt under Fitch's conservative rating-case scenario. Its debt
metrics will remain commensurate with that of its peers and with
its 'b+' Standalone Credit Profile (SCP) over the medium term.
Konya's IDRs are not capped by the Turkish sovereign's IDRs
(B+/Positive).
KEY RATING DRIVERS
Risk Profile: 'Vulnerable'
This reflects a very high risk that Konya's ability to cover debt
service with its operating balance may weaken unexpectedly over the
rating scenario horizon (2024-2028) due to lower revenue, higher
expenditure or an unexpected rise in liabilities or debt-service
requirements.
Revenue Robustness: 'Midrange'
Fitch expects that Konya's dynamic and well-diversified local
economy will lead to tax revenue growth prospects slightly above
national nominal GDP growth. Taxes are about two-thirds of Konya's
operating revenue. Under its conservative rating case, Fitch
expects operating revenue to grow above the expected national
nominal GDP CAGR of about 28% to TRY36 billion in 2028 from TRY9.6
billion in 2023.
Konya's efforts to develop a new Organisational Industrial Zone
will support economic growth prospects by attracting new businesses
and investments. This will support employment, boosting taxes, as
evidenced by higher-than-average growth of tax revenue in 2023 at
around 95%. This is further underpinned by the relatively low
unemployment rate at 6.1% in 2023 versus the national average of
7.4%. Land sales within industrial zones will also help Konya
generate substantial capital revenue over the medium term. Fitch
expects Konya's capital revenue to be 25% of total revenue in
2024-2028, significantly higher than national peers, creating
additional budgetary flexibility.
Revenue Adjustability: 'Weaker'
Konya's ability to generate additional revenue is constrained by
nationally pre-defined tax rates. At end-2023, nationally collected
tax revenue over which Konya has no tax-setting power comprised 66%
of operating revenue or 45% of total revenues. Local taxes, for
which Konya has rate-setting power, represented a negligible 0.1%
of total revenue, underlining its near absence of tax revenue
generation ability. The inflexibility of tax-setting powers is
compensated by the scope for asset sales and financial-equalisation
transfers as part of the current transfers received by the
metropolitan municipalities. This accounted for 32% and 15% of
Konya's total revenue, respectively, in 2023.
Non-tax revenue, such as charges and fees, make up about 8% of
total revenue. Konya does not have full discretion on non-tax
revenue such as charges, rental income and fees levied on public
services, as these are limited by central government. Fitch assumes
the additional leeway would cover less than 50% of what it would
expect to be a reasonable decline in revenues in an economic
downturn.
Expenditure Sustainability: 'Weaker'
This reflects the persistent high inflationary operating
environment, which could erode expenditure control despite Konya's
moderately cyclical and counter-cyclical responsibilities. Konya's
opex growth exceeded operating revenue growth during the last two
years, leading operating margins to fall to 24% on average down
from 36% in 2020. Fitch expects persistent high inflation will
continue to weaken control of opex, with continued pressure on
staff costs due to management's above inflation increase in
consolidated staff salaries in 2023.
Fitch expects Konya to continue large capital investments of on
average 37% of total expenditure in the medium term, focusing on
metro line construction as well infrastructure projects such as
road construction, restoration of buildings, and land development
projects. This will result in large deficits before financing of on
average 8% of total revenue for 2024-2028, in line with previous
years, and increase its borrowings. Fitch expects recent
cost-cutting measures introduced by the central government and an
expected decline in inflation from 2026 will help Konya restore its
control of expenditure growth.
Expenditure Adjustability: 'Midrange'
This reflects Konya's lower share of inflexible costs than its
international peers at less than 60% of total expenditure, which is
in line with other Fitch-rated Turkish metropolitan municipalities.
Konya can cut or postpone infrastructure investments, aided by its
fairly well-developed socio-economic infrastructure.
Spending flexibility is offset by Konya's weak record of balanced
budgets due to large capex swings in pre-election periods and its
moderate affordability of reduction due to the existing level of
services and investments. Fitch expects Konya's spending
flexibility to be reduced by persistent high inflation and its
ambitious investment programme, and to be gradually restored
thereafter with expected declining inflation.
Liabilities & Liquidity Robustness: 'Weaker'
Konya is exposed to moderate FX risk with nearly 34% of its total
debt in euros and unhedged. By end-2024, Fitch expects FX
volatility to result in a roughly 5% increase in its debt stock.
Fitch expects the share of FX debt to increase to about 75% under
its conservative rating case, driven by ongoing metro line
investment to be financed by new FX borrowing. Interest-rate risk
is mitigated as the majority of Konya's bank loans were at fixed
rates as of end-2023. Additionally, the weighted average life of
its total debt is 2.1 years, which results in refinancing pressure,
as nearly 34% of its debt is due in 2024.
These risks are partly offset by the amortising nature of Konya's
bank loans and additional budgetary flexibility from its expected
stronger capital revenue-generation capacity over the medium term.
Contingent liabilities solely comprise borrowings of its water
affiliate, KOSKI, which is a self-sustaining entity, underpinned by
its strong payback ratio at 0.7x and its robust actual debt service
coverage (ADSCR) at 1.5x in 2023.
Liabilities & Liquidity Flexibility: 'Weaker'
The counterparty risk associated with its domestic liquidity
providers rated below 'BBB-' and short tenor of loans limit its
assessment to 'Weaker', similar to other Turkish local and regional
governments (LRGs). Konya has good access to national lenders, but
access to international lenders is still new. Konya's year-end cash
was fully restricted for the settlement of payables at end-2023.
Turkish LRGs do not benefit from treasury lines or national
cash-pooling, making it challenging to fund unexpected increases in
debt liabilities or spending peaks.
Debt Sustainability: 'aa category'
Under Fitch's rating case for 2024-2028, Konya's operating balance
will increase to about TRY6.0 billion, from nearly TRY2.1 billion
in 2023, with direct debt up at TRY23.6 billion in 2028 from TRY4.2
billion in 2022. This will result in a payback ratio (net
Fitch-adjusted debt/operating balance; the primary debt
sustainability metric for Type B LRGs) remaining slightly below 5x,
in line with a 'aaa' debt sustainability (DS) assessment.
For secondary metrics, Fitch's rating case projects that the ADSCR
will improve towards 1.2x by 2028, from 0.6x in 2023, corresponding
to a 'bb' assessment. The fiscal debt burden will remain below
100%, corresponding to a 'aa' DS assessment. The weaker secondary
metrics offset the debt payback ratio to result in an overall DS
assessment of 'aa'.
Derivation Summary
Fitch assesses Konya's SCP at 'b+', which reflects a 'Vulnerable'
risk profile and 'aa' DS score. The 'b+' SCP also factors in
Konya's comparison with national and international peers in the
same rating category. Konya's IDRs are not capped by the Turkish
sovereign IDRs and no other rating factors affect the rating.
Short-Term Ratings
The 'B' Short- Term IDR is the only option mapping to a 'B+'
Long-Term IDR.
National Ratings
Konya's National Ratings are driven by its Long-Term Local-Currency
IDR of 'B+', which is mapped to 'AA(tur)' on the Turkish National
Rating Correspondence Table based on peer comparison.
Key Assumptions
Qualitative Assumptions:
Risk Profile: 'Vulnerable'
Revenue Robustness: 'Midrange'
Revenue Adjustability: 'Weaker'
Expenditure Sustainability: 'Weaker'
Expenditure Adjustability: 'Midrange'
Liabilities and Liquidity Robustness: 'Weaker'
Liabilities and Liquidity Flexibility: 'Weaker'
Debt sustainability: 'aa'
Support (Budget Loans): 'N/A'
Support (Ad Hoc): 'N/A'
Asymmetric Risk: 'N/A'
Rating Cap (LT IDR): 'N/A'
Rating Cap (LT LC IDR) 'N/A'
Rating Floor: 'N/A'
Quantitative assumptions - Issuer Specific
Fitch's rating case is a "through-the-cycle" scenario, which
incorporates a combination of revenue, cost and financial risk
stresses. It is based on 2019-2023 figures and 2024-2028 projected
ratios. The key assumptions for the scenario include:
- Operating revenues CAGR of 30.2% in 2024-2028 (versus 43.8% yoy
for 2019-2023 due to expected high inflation of 30% on average in
2024-2028);
- Tax revenue CAGR of 30.2% in 2024-2028, versus 48.5% CAGR in
2019-2023
- Current transfers CAGR of 29.5% in 2024-2028, versus 43.8% CAGR
in 2019-2023
- Operating expenses CAGR of 31.8% in 2024-2028 (versus 53.3% yoy
for 2019-2023 due to expected high inflation of 30% on average in
2024-2028);
- Negative net capital balance of TRY5 billion in 2024-2028
- Apparent cost of debt to be on average 15%, slightly below the
average cost of debt in 2023 due to lower financing costs
associated with the expected new FX debt
- USD/TRY (average) assumptions are based on Fitch's sovereign
estimate for 2024 at USD/TRY36, 2025 at USD/TRY40, 2026 at
USD/TRY44, with additional annual depreciation of 10% for
2027-2028.
Liquidity and Debt Structure
Konya's direct debt increased to TRY6.6 billion at end-2023 from
TRY4.2 billion in 2022. Year-end cash of TRY28 million is
restricted and earmarked for the settlement of payables, leading to
net adjusted debt of TRY6.6 billion. The operating balance, which
was adjusted upwards by nearly TRY878 million after the
re-allocation of spending items between one-off operating costs and
investment-related spending, was about TRY2.1 billion, which is 22%
of operating revenue, leading to a robust payback ratio of 3.2x in
2023.
Konya's contingent liabilities are moderate and solely comprise the
liabilities of its water affiliate, KOSKI. Fitch expects capex to
remain high and Konya to spend on average TRY13.3 billion annually
in the next five years, focused on metro line construction and
regular infrastructure investments. Capex will account for on
average 37% of total expenditure during the forecast period. Konya
expects to finance its investments with a mix of capital revenues
(at around 60%) and new FX borrowings with longer maturities.
Issuer Profile
Konya has a population of about 2.3 million people, accounting for
2.7% of Turkiye's national population. It benefits from a
diversified local economy. With GDP per capita of TRY140,328, Konya
accounts for 79% of the national average and contributes 2.1% of
national GDP.
Rating Sensitivities
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
A downgrade of the Turkish sovereign's IDRs or a downward revision
of Konya's SCP resulting from a debt payback of more than nine
years on a sustained basis would lead to a downgrade of Konya's
IDRs.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
An upgrade of the Turkish sovereign's IDRs would lead to an upgrade
of Konya's IDRs, provided that it maintains its debt payback ratio
below 5x without significant deterioration in actual debt service
coverage ratio and fiscal debt burden under its rating case.
ESG Considerations
The highest level of ESG credit relevance is a score of '3', unless
otherwise disclosed in this section. A score of '3' means ESG
issues are credit-neutral or have only a minimal credit impact on
the entity, either due to their nature or the way in which they are
being managed by the entity. Fitch's ESG Relevance Scores are not
inputs in the rating process; they are an observation on the
relevance and materiality of ESG factors in the rating decision.
Discussion Note
Committee date: 12 August 2024
There was an appropriate quorum at the committee and the members
confirmed that they were free from recusal. It was agreed that the
data was sufficiently robust relative to its materiality. During
the committee no material issues were raised that were not in the
original committee package. The main rating factors under the
relevant criteria were discussed by the committee members. The
rating decision as discussed in this rating action commentary
reflects the committee discussion.
Public Ratings with Credit Linkage to other ratings
Konya's IDRs are aligned with Turkish sovereign's ratings.
Entity/Debt Rating Prior
----------- ------ -----
Konya Metropolitan
Municipality LT IDR B+ Affirmed B+
ST IDR B Affirmed B
LC LT IDR B+ Affirmed B+
Natl LT AA(tur)Affirmed AA(tur)
MANISA METROPOLITAN: Fitch Affirms 'B+' LongTerm IDRs, Outlook Pos.
-------------------------------------------------------------------
Fitch Ratings has affirmed Manisa Metropolitan Municipality's
(Manisa) Long-Term Foreign- and Local-Currency Issuer Default
Ratings (IDRs) at 'B+' with Positive Outlooks. Fitch has also
upgraded Manisa's National Long-Term Rating to 'AAA(tur)' from
AA+(tur)'. The Outlook is Stable.
The rating affirmation reflects Fitch's unchanged view that
Manisa's operating performance will remain resilient, despite a
highly inflationary operating environment, due to a buoyant and
diversified tax revenue base. This will support robust coverage of
Manisa's moderate debt by its operating balance, leading to debt
metrics that are commensurate with a 'bb+' category Standalone
Credit Profile. Manisa's IDRs are capped by the Turkish sovereign's
'B+' IDRs.
KEY RATING DRIVERS
Risk Profile: 'Vulnerable'
Fitch sees a very high risk that Manisa's ability to cover debt
service with its operating balance may weaken unexpectedly over
2024-2028 due to lower-than-expected revenue, higher-than-projected
expenditure or an unforeseen rise in liabilities or debt-service
requirements.
Revenue Robustness: 'Midrange'
Manisa has a dynamic tax base and an industrialised local economy.
Its diversified tax-revenue structure is not subject to significant
volatility and its robust tax revenue growth prospects are broadly
in line with Turkiye's expected nominal GDP CAGR of 28% in
2024-2028. Local nominal GDP CAGR was 37.2% in 2018-2022, also in
line with national nominal GDP CAGR of 36.8%. Taxes represent about
65% of operating revenue and their growth should drive operating
revenue towards TRY17.7 billion by 2028 from TRY4.9 billion in
2023.
Revenue Adjustability: 'Weaker'
Manisa's ability to generate additional revenue is constrained by
nationally pre-defined tax rates. At end-2023, nationally set and
collected taxes comprised 62% of Manisa's total revenue. Local
taxes, over which Manisa has tax autonomy, were a low 0.4% of total
revenue and also constrained by ceilings set by the central
government. Negligible tax autonomy is, however, partly offset by
financial equalisation transfers and by fees and charges over which
Manisa has some control. These transfers and fees and charges were
24% and 9%, respectively, of its total revenue in 2023.
Expenditure Sustainability: 'Weaker'
Moderately cyclical to countercyclical spending responsibilities
allow Manisa to adapt spending to local economic cycles. High
inflation caused operating expenditure (CAGR 47.3%) to increase at
a faster pace than operating revenues (CAGR: 40.0%) in 2019-2023.
Nevertheless, Manisa managed to report surpluses before financing
during the last five years.
Fitch expects persistently high inflation to challenge Manisa's
control over total expenditure, with operating expenditure growth
outpacing operating revenue growth by around 4% over the medium
term. Expected investments, averaging 37% of total spending, will
further constrain Manisa's ability to curb spending. However,
recent cost-cutting measures by the central government and expected
decline in inflation from 2026 onwards should help Manisa regain
control over expenditure growth.
Expenditure Adjustability: 'Midrange'
Manisa has a lower share of inflexible costs than its international
peers on average at less than 60% of total expenditure, which is in
line with other Fitch-rated Turkish metropolitan municipalities'.
Spending flexibility is further supported by Manisa's improved
record of balanced budgets as underlined by surpluses before
financing in the last five years. Capex is about 40% of total
expenditure and supports spending flexibility, but is constrained
by the limited affordability of reduction due to modest levels of
existing services and investments as well as by high inflation.
Fitch expects Manisa's flexibility in spending to be gradually
restored from 2026 onwards, as inflation slows.
Liabilities & Liquidity Robustness: 'Weaker'
Manisa has limited unhedged foreign-exchange risk with a
euro-denominated loan accounting for 16% of its total debt. A
majority of its loans are at fixed interest rates, resulting in
negligible interest-rate risk. However, its very short weighted
average life of debt at 1.6 years results in material refinancing
risk. This is partly offset by Manisa's robust actual debt service
coverage ratio (ADSCR) of 4.5x in 2023, the amortising nature of
its bank loans, and fairly low indebtedness. The latter is
underpinned by a strong payback ratio at 0.2x in 2023. Manisa is
not exposed to material off-balance sheet risk.
Liabilities & Liquidity Flexibility: 'Weaker'
Counterparty risk associated with Manisa's domestic liquidity
providers rated below 'BBB-' and the short tenor of its loans limit
its assessment to 'Weaker', similar to that of other Turkish local
and regional governments (LRGs). It also reflects Manisa's weak
unrestricted cash reserves, net of receivables and payables, which
cover only 0.1x annual debt service. Turkish LRGs do not benefit
from treasury lines or national cash-pooling, making it challenging
to fund unexpected increases in liabilities or spending peaks.
Debt Sustainability: 'aaa category'
Under Fitch's rating case for 2024-2028, Manisa's operating balance
will be about TRY5.3 billion with direct debt totaling TRY9.3
billion in 2028, leading to a debt payback ratio (net adjusted
debt-to- operating balance) of below 5x, in line with an 'aaa' debt
sustainability (DS) assessment. Fitch's rating case projects that
Manisa's ADSCR will weaken to about 2.0x in 2028 from 4.5x in 2023,
but it will still remain solid, corresponding to an 'aa' category
DS. The assessment is further supported by a low fiscal debt burden
(net adjusted debt-to-operating revenue) at 52.6% in 2028,
corresponding to the 'aa' category DS, albeit up from 9.4% in
2023.
Derivation Summary
Manisa's SCP at 'bb+' reflects a 'Vulnerable' risk profile and
'aaa' debt sustainability. The SCP also factors in Manisa's
favourable comparison with its national and international peers in
the same rating category, underpinned by a payback ratio at the
lower end of the 'aaa' DS band and a stronger ADSCR than some
peers' under Fitch's rating case.
Short-Term Ratings
Manisa's 'B' Short-Term IDR is the only option for a 'B+' Long-Term
IDR.
National Ratings
Manisa's National Rating is derived from its Long-Term
Local-Currency IDR at 'B+', which is mapped to the highest scale
rating of 'AAA(tur)' on the Turkish National Rating Correspondence
Table . The Outlook is Stable.
Key Assumptions
Qualitative Assumptions:
Risk Profile: 'Vulnerable'
Revenue Robustness: 'Midrange'
Revenue Adjustability: 'Weaker'
Expenditure Sustainability: 'Weaker'
Expenditure Adjustability: 'Midrange'
Liabilities and Liquidity Robustness: 'Weaker'
Liabilities and Liquidity Flexibility: 'Weaker'
Debt sustainability: 'aaa'
Support (Budget Loans): 'N/A'
Support (Ad Hoc): 'N/A'
Asymmetric Risk: 'N/A'
Rating Cap (LT IDR): 'B+'
Rating Cap (LT LC IDR) 'B+'
Rating Floor: 'N/A'
Quantitative assumptions - Issuer Specific
Fitch's rating case is a "through-the-cycle" scenario, which
incorporates a combination of revenue, cost and financial risk
stresses. It is based on 2019-2023 published figures and 2024-2028
projected ratios. The key assumptions for the scenario include:
- Operating revenue CAGR of 29.1% in 2024-2028 (versus 40.0% year
on year for 2019-2023), due to an expected high inflation of 30% on
average in 2024-2028
- Tax revenue CAGR of 28.9% in 2024-2028, versus 47.8% CAGR in
2019-2023
- Current transfers CAGR of 29.4% in 2024-2028, versus 44.5% CAGR
in 2019-2023
- Operating expenses CAGR of 33.2% in 2024-2028 (versus 47.3% year
on year for 2019-2023) due to an expected high inflation of 30% on
average in 2024-2028
- Negative net capital balance of TRY5.1 billion in 2024-2028
- Apparent cost of debt on average at 27.1%, about 13% above the
average cost of debt in 2023 due to higher borrowing rates
- US dollar/Turkish lira (average) exchange rate assumptions are
based on Fitch's sovereign estimates at TRY36 to US dollar for
2024, TRY40 for 2025, TRY44 for 2026, and with an annual
depreciation of 10% for 2027-2028
Liquidity and Debt Structure
Manisa's total debt decreased to TRY512 million in 2023 from TRY805
million in 2022, while its unrestricted cash was TRY49 million,
leading to a net adjusted debt of TRY463 million. Manisa's
unrestricted cash is adjusted by the amount that is earmarked for
payables, which Fitch deems as restricted.
Manisa is not exposed to material off-balance sheet risk.
Contingent liabilities are moderate and stem solely from its water
affiliate, MASKI, which is self-sustaining with a sound payback
ratio at 1.6x in 2023.
Fitch expects Manisa to spend an average TRY5.4 billion annually on
investments for the next five years mainly for road construction
and maintenance. Fitch expects capex to be funded by a mix of new,
local-currency borrowing or Manisa's operating cash flow. Fitch
expects total debt to reach TRY9.3 billion in 2028 due to
capex-driven debt.
Issuer Profile
Manisa has a population of nearly 1.5 million, 1.7% of Turkiye. It
is the second-largest industrial and trade hub in the Aegean
region. Manisa's GDP per capita in 2022 was TRY169,167, broadly in
line with the national average. Its buoyant local economy is
dominated by industry (48%), followed by services (28%) and
agriculture (14%).
Rating Sensitivities
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
A downgrade of Turkish sovereign IDRs or a downward revision of
Manisa's SCP resulting from a debt payback of more than nine years
on a sustained basis would lead to a downgrade of Manisa's IDRs.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
An upgrade of the Turkish sovereign IDRs would lead to a similar
rating action on Manisa's IDRs, provided that Manisa maintains its
debt payback ratio below 5x without significant deterioration in
ADSCR and fiscal debt burden under its rating case.
ESG Considerations
The highest level of ESG credit relevance is a score of '3', unless
otherwise disclosed in this section. A score of '3' means ESG
issues are credit-neutral or have only a minimal credit impact on
the entity, either due to their nature or the way in which they are
being managed by the entity. Fitch's ESG Relevance Scores are not
inputs in the rating process; they are an observation on the
relevance and materiality of ESG factors in the rating decision.
Discussion Note
Committee date: 12 August 2024
There was an appropriate quorum at the committee and the members
confirmed that they were free from recusal. It was agreed that the
data was sufficiently robust relative to its materiality. During
the committee no material issues were raised that were not in the
original committee package. The main rating factors under the
relevant criteria were discussed by the committee members. The
rating decision as discussed in this rating action commentary
reflects the committee discussion.
Public Ratings with Credit Linkage to other ratings
Manisa's IDRs are capped by the Turkish sovereign IDRs.
Entity/Debt Rating Prior
----------- ------ -----
Manisa Metropolitan
Municipality LT IDR B+ Affirmed B+
ST IDR B Affirmed B
LC LT IDR B+ Affirmed B+
LC ST IDR B Affirmed B
Natl LT AAA(tur)Upgrade AA+(tur)
MERSIN METROPOLITAN: Fitch Affirms 'B+' IDR, Alters Outlook to Pos.
-------------------------------------------------------------------
Fitch Ratings has revised Mersin Metropolitan Municipality's
(Mersin) Outlook to Positive from Stable while affirming its
Long-Term Foreign- and Local-Currency Issuer Default Ratings (IDRs)
at 'B+'. Fitch has also upgraded Mersin's National Long-Term Rating
to 'AA+(tur)' from 'AA-(tur)'. The Outlook is Stable.
The Outlook revision reflects Mersin's improved operating balance
resulting from higher-than-expected tax collections, especially in
VAT and special consumption tax, which broadly offset expenditure
growth caused by persistently high inflation. This led to an
improvement of its debt metrics with a payback ratio at 0.4x and an
actual debt service coverage ratio (ADSCR) at 5.5x in 2023.
Fitch expects Mersin's operating balance to support its payback
ratio at 4.0x by 2028, down from its previous expectation of 4.8x,
and its ADSCR to average 1.5x under its conservative rating case
versus its previous assessment of 1.1x. Hence, Fitch has revised
debt sustainability (DS) higher to 'aaa', from 'aa' previously,
leading to a revision of Mersin's Standalone Credit Profile (SCP)
to 'bb-' from 'b+'. This has led us to revise the IDR Outlook to
mirror the Turkish sovereign's as Mersin's IDRs are now capped by
Turkiye's 'B+' IDRs.
The ratings reflect Fitch's view that Mersin will maintain a robust
operating balance despite high inflation, although debt will
increase substantially due to public transportation investments
under Fitch's conservative rating case. Mersin's debt metrics will
be commensurate with a 'bb-' SCP.
KEY RATING DRIVERS
Risk Profile: 'Vulnerable'
Fitch sees a very high risk that Mersin's ability to cover debt
service with its operating balance may weaken unexpectedly over
2024-2028, due to lower-than-expected revenue,
higher-than-projected expenditure or an unforeseen rise in
liabilities or debt-service requirements.
Revenue Robustness: 'Midrange'
Mersin's tax revenue base is diversified, supported by its trade-
and manufacturing-driven local economy. This diversification leads
to less volatile tax revenue and buoyant tax revenue growth
prospects; Fitch expects the latter to exceed Turkiye's nominal GDP
CAGR of 28% for 2024-2028. Tax revenue should drive operating
revenue towards TRY32.9 billion in 2028 from TRY8.8 billion in
2023, supporting its operating balance under its rating case. Tax
revenue represented around 70% of operating revenue on average in
2019-2023.
Revenue Adjustability: 'Weaker'
Mersin's ability to generate additional revenue is constrained by
nationally pre-defined tax rates. At end-2023, nationally set and
collected taxes, over which Mersin has no tax rate-setting power,
comprised 73% of its total revenue. Local taxes, over which Mersin
has tax rate-setting power, were 0.2% of total revenue. This
implies negligible tax flexibility, which is further constrained by
the ceilings set by the central government. This is partly
compensated by charges and fees over which Mersin has some control,
and to a much lesser extent by asset sales. These items account for
8% and 1% of total revenue, respectively.
Expenditure Sustainability: 'Weaker'
Fitch expects a persistently high inflationary operating
environment to erode expenditure control despite Mersin's
moderately cyclical and counter-cyclical responsibilities. Mersin's
operating expenditure growth has lagged operating revenue growth by
4% for the past five years, leading to average operating margins of
30%.
Mersin's capital-intensive investment programme, which is primarily
focused on a metro line construction in the next five years will
take up about 30% of total expenditure and, together with high
inflation, further constrain Mersin's ability to curb spending.
Fitch expects recent cost-cutting measures by the central
government and a decline in inflation from 2026 onwards to help
Mersin regain control over expenditure growth.
Expenditure Adjustability: 'Midrange'
Mersin has a low share of inflexible costs compared with
international peers, at less than 65% on average of total
expenditure, which is similar to its national peers'. Capex, the
second largest spending item, can be postponed, or to a less extent
be cut, aided by Mersin's fairly developed socio-economic
infrastructure. Spending flexibility is counterbalanced by a weak
record of balanced budgets, due to large swings in capex and
moderate affordability for cuts given modest existing levels of
public services and investments.
Mersin's capex remains about 30% of total spending under its rating
case, versus 27% in 2019-2023, driven by its investment on metro
line constructions. This will result in large budget deficits
before financing on average at close to 19% of total revenue for
2024-2028. However, this should improve to below 15% towards
end-2028 as inflation slows.
Liabilities & Liquidity Robustness: 'Weaker'
Mersin is exposed to considerable foreign-exchange (FX) risk due to
large volatility in the Turkish lira, with nearly 42% of its total
debt in euros and unhedged. Its debt has a fairly short weighted
average life at 2.9 years, increasing refinancing risk. This is
mitigated by its ADSCR, which will remain at least around 1.5x
under Fitch's rating case, and its fully amortising bank loans.
Fitch also expects new FX loans to extend the average maturity of
its existing debt stock. A majority of Mersin's bank loans are at
fixed rates, resulting in limited interest-rate risk. Mersin is not
exposed to material off-balance sheet risk.
Liabilities & Liquidity Flexibility: 'Weaker'
Counterparty risk associated with Mersin's domestic liquidity
providers rated below 'BBB-' and the short tenor of its loans limit
its assessment to 'Weaker', similar to that of other Turkish local
and regional governments (LRGs). Mersin's cash at end-2023 was
fully restricted for payables settlement. It has a good record of
accessing national lenders and improving relationships with
international lenders. Turkish LRGs do not benefit from treasury
lines or national cash-pooling, making it challenging to fund
unexpected increases in debt liabilities or spending peaks.
Debt Sustainability: 'aaa category'
Mersin's revised overall DS assessment to 'aaa' is based on a
robust payback ratio (net adjusted debt-to-operating balance),
which Fitch expects to remain resilient at below 4.0x to 2028. The
revision is further supported by an improved ADSCR of 1.5x on
average, corresponding to an 'a' category DS, versus a 'bb'
category DS previously, and by a fiscal debt burden (net adjusted
debt-to-operating revenue) remaining below 100%, which is equal to
a 'aa' category DS. The latter is an improvement from its previous
assessment of an 'a' category DS.
Fitch therefore no longer applies a downward adjustment to DS
(previously to aa) due to Mersin's capacity to report robust
operating balances amid high inflation. This is despite an expected
fall in the operating margin to 20% on average over 2024-2028 from
30% in 2019-2023 and substantial debt increases.
Derivation Summary
Fitch assesses Mersin's SCP at 'bb-', which reflects a 'Vulnerable'
risk profile and an 'aaa' DS. The 'bb-' SCP also factors in
Mersin's comparison with national and international peers in the
same rating category. Mersin's IDRs are not affected by any other
rating factors but are capped by the Turkish sovereign IDRs.
Short-Term Ratings
Mersin's 'B' Short-Term IDR is the only option for a 'B+' Long-Term
IDR.
National Ratings
Mersin's National Rating is derived from its Long-Term
Local-Currency IDR at 'B+'. Following Mersin's revision of its SCP
to 'bb-', its National Long-Term Rating is mapped to 'AA+(tur)' on
the Turkish National Correspondence Table after a national peer
comparison. The Outlook is Stable.
Key Assumptions
Qualitative Assumptions:
Risk Profile: 'Vulnerable, Unchanged with Low weight'
Revenue Robustness: 'Midrange, Unchanged with Low weight'
Revenue Adjustability: 'Weaker, Unchanged with Low weight'
Expenditure Sustainability: 'Weaker, Unchanged with Low weight'
Expenditure Adjustability: 'Midrange, Unchanged with Low weight'
Liabilities and Liquidity Robustness: 'Weaker, Unchanged with Low
weight'
Liabilities and Liquidity Flexibility: 'Weaker, Unchanged with Low
weight'
Debt sustainability: 'aaa, Raised with High weight'
Support (Budget Loans): 'N/A, Unchanged with Low weight'
Support (Ad Hoc): 'N/A, Unchanged with Low weight'
Asymmetric Risk: 'N/A, Unchanged with Low weight'
Rating Cap (LT IDR): 'B+, Unchanged with Low weight'
Rating Cap (LT LC IDR) 'B+, Unchanged with Low weight'
Rating Floor: 'N/A, Unchanged with Low weight'
Quantitative assumptions - Issuer Specific
Fitch's rating action is driven by the following quantitative
assumptions (metrics) expected under its rating case:
- Payback ratio: 4.0x, 'aaa' category, improved with high weight
- Coverage ratio: 1.5x, 'a' category, raised with high weight
- Fiscal debt burden: 79.8%, 'aa' category, raised with high
weight
Fitch's rating case is a "through-the-cycle" scenario, which
incorporates a combination of revenue, cost and financial risk
stresses. It is based on 2019-2023 published figures and 2024-2028
projected ratios. The key assumptions for the scenario include:
- Operating revenue CAGR of 30.2% in 2024-2028 (versus 46.2% year
on year for 2019-2023) due to expected high inflation of 30% on
average in 2024-2028
- Tax revenue CAGR of 30.5% in 2024-2028, versus 49.9% CAGR in
2019-2023
- Current transfers CAGR of 29.5% CAGR in in 2024-2028, versus 41%
CAGR in 2019-2023
- Operating expenses CAGR of 33.6% in 2024-2028 (versus 42.3% year
on year for 2019-2023) due to expected high inflation of 30% on
average in 2024-2028
- Negative net capital balance of TRY7.7 billion in 2024-2028
- Apparent cost of debt on average at 13.3%, slightly below the
average cost of debt in 2023 due to lower financing costs
associated with expected new foreign-currency debt
- US dollar/Turkish average exchange rate assumptions are based on
Fitch's sovereign estimates of TRY36/USD for 2024, TRY40/USD for
2025, TRY44/USD for 2026, and with an annual depreciation of 10%
for 2027-2028
Quantitative assumptions - Sovereign Related
Figures as per Fitch's sovereign actual for 2022 and forecast for
2025, respectively (no weights and changes since the last review
are included as none of these assumptions were material to the
rating action)
- GDP per capita (US dollar, market exchange rate): 10,525; 14,320
- Real GDP growth (%): 5.5; 3.1
- Consumer prices (annual average % change): 72.0; 29.2
- General government balance (% of GDP): -0.8; -3.0
- General government debt (% of GDP): 31.7; 29.1
- Current account balance plus net foreign direct investments (% of
GDP): -4.4; -1.6
- Net external debt (% of GDP): 15.9; 16.7
- IMF Development Classification: EM (emerging market)
- CDS Market-Implied Rating: 'B+'
Liquidity and Debt Structure
Mersin's total direct debt increased to TRY1.1 billion in 2023 from
TRY787 million in 2022. As year-end cash of TRY491 million is
restricted and earmarked for payables settlement, net adjusted debt
is same as total direct debt at TRY1.1 billion. The operating
balance was about TRY2.6 billion (30% of operating revenue),
leading to a strong payback ratio of 0.4x in 2023.
Mersin is not exposed to material off-balance sheet risk.
Contingent liabilities are moderate and stem solely from its water
affiliate, MESKI, which is self-sustaining. Although MESKI's
borrowing will continue to increase due to its new investments,
Fitch expects the company to service its debt with its own cash
flow. In 2023, MESKI reported a resilient operating balance,
leading to a payback ratio at around 5.0x.
Fitch expects Mersin to spend on average TRY8 billion annually on
investments in the next five years, focused on the metro line
expansion. Mersin expects to finance the metro investments with
foreign-currency borrowings with longer maturities.
Issuer Profile
Mersin, an important logistics hub with connections to the Middle
East and the Black Sea, has a population of 1.9 million people or
2.3% of the country's total population. Mersin's GDP per capita in
2022 was TRY162,806, corresponding to 92% of the national average.
Rating Sensitivities
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
A downgrade of the Turkish sovereign IDRs or a downward revision of
Mersin's SCP resulting from a debt payback of more than nine years
on a sustained basis would lead to a downgrade of Mersin's IDRs.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
An upgrade of the sovereign IDRs would lead to an upgrade of
Mersin's IDRs, provided that Mersin maintains its debt payback
ratio below 5x without significant deterioration in its ADSCR and
fiscal debt burden under its rating case.
ESG Considerations
The highest level of ESG credit relevance is a score of '3', unless
otherwise disclosed in this section. A score of '3' means ESG
issues are credit-neutral or have only a minimal credit impact on
the entity, either due to their nature or the way in which they are
being managed by the entity. Fitch's ESG Relevance Scores are not
inputs in the rating process; they are an observation on the
relevance and materiality of ESG factors in the rating decision.
Discussion Note
Committee date: 12 August 2024
There was an appropriate quorum at the committee and the members
confirmed that they were free from recusal. It was agreed that the
data was sufficiently robust relative to its materiality. During
the committee no material issues were raised that were not in the
original committee package. The main rating factors under the
relevant criteria were discussed by the committee members. The
rating decision as discussed in this rating action commentary
reflects the committee discussion.
Public Ratings with Credit Linkage to other ratings
Mersin's IDRs are capped by the Turkish sovereign IDRs.
Entity/Debt Rating Prior
----------- ------ -----
Mersin Metropolitan
Municipality LT IDR B+ Affirmed B+
ST IDR B Affirmed B
LC LT IDR B+ Affirmed B+
LC ST IDR B Affirmed B
Natl LT AA+(tur)Upgrade AA-(tur)
MUGLA METROPOLITAN: Fitch Affirms B+ LongTerm IDR, Outlook Positive
-------------------------------------------------------------------
Fitch Ratings has affirmed Mugla Metropolitan Municipality's
Long-Term Foreign and Local-Currency Issuer Default Ratings (IDRs)
at 'B+' with Positive Outlooks.
Fitch has revised Mugla's Standalone Credit Profile (SCP) to 'bbb+'
from 'bbb' due to its stronger debt metrics compared with peers,
supported by its robust operating balance and low indebtedness.
Higher-than-expected increases in corporate income tax and VAT tax
collections, driven by sustained growth of tourism activity have
supported operating revenue. Opex growth was more moderate despite
high inflation. This led to an improved operating balance,
supporting the payback ratio remaining strong at 0.4x by 2028 in
its rating case and a stronger debt service coverage ratio at
9.5x.
The affirmation reflects Fitch's unchanged view that Mugla will
maintain a robust operating balance despite high inflation,
although capex-driven debt will increase under Fitch's conservative
rating case. Its debt metrics will remain commensurate with that of
its peers with a 'bbb+' Standalone Credit Profile (SCP) over the
medium term. Mugla's IDRs are capped by the Turkish sovereign's
'B+' IDRs and the Positive Outlooks reflect that on the sovereign.
KEY RATING DRIVERS
Risk Profile: 'Weaker'
The risk profile reflects three 'Midrange' key rating factors and
three 'Weaker' factors. The assessment reflects the high risk of
Mugla's ability to cover debt service with the operating balance
weakening unexpectedly over the scenario horizon (2024-2028) due to
lower revenue, higher expenditure, or an unexpected rise in
liabilities or debt-service requirements.
Revenue Robustness: 'Midrange'
This reflects Fitch's expectations that Mugla's local economy will
benefit from increased tourist arrivals, which have rebounded to
pre-pandemic 2019 levels. The post-pandemic growth trend is
consistent with the pre-pandemic period, supporting low volatility
of the tax revenue base and operating revenue growth broadly in
line with expected national nominal GDP CAGR of around 28% over the
medium term. Taxes represent about two-thirds of Mugla's operating
revenue.
This will support employment, boosting personal and corporate
income tax and VAT. Fitch therefore forecasts strong operating
margins at 48% on average in 2024-2028. This is underpinned by the
relatively low unemployment rate, at 8.1% in 2023 versus the
national average of 9.4%, and stable tax revenues, with a CAGR of
49.3% in 2019-2023, compared with national nominal GDP CAGR at
47.5%.
Revenue Adjustability: 'Weaker'
Mugla's ability to generate additional revenue is constrained by
nationally pre-defined tax rates. At end-2023, nationally collected
and set taxes comprised 70% of Mugla's operating revenue or 61% of
total revenue. Local taxes set by Mugla were a low 0.4% of total
revenue, implying negligible tax flexibility and also constrained
by ceilings set by the central government.
The inflexibility of tax-setting powers is compensated to some
extent by the financial equalisation transfers under the current
transfers received by the metropolitan municipalities and the
limited flexibility on charges and fees levied for public services.
For Mugla, this accounted for 20% and 6% of its total revenue,
respectively, in 2023. Due to its strong cash position, Mugla's
interest revenues contribution was around 13% in 2023.
Expenditure Sustainability: 'Weaker'
Mugla's moderately cyclical to countercyclical spending
responsibilities help the city adapt spending to local economic
cycles. Its opex growth lagged operating revenue growth in
2019-2023, resulting in a sound average 47% operating margin.
However, Fitch expects persistent high inflation to reverse Mugla's
trend of expenditure growth lagging revenue growth. In its
rating-case scenario, Fitch expects opex to surpass operating
revenue growth by around 7%.
Persistent high inflation is likely to exert additional pressure on
Mugla's opex including subsidies to its transportation company and
its investment spending, which Fitch forecasts to rise to 52% of
its total expenditure on average. This will constrain Mugla's
ability to curb spending over the medium term. However, Fitch
expects the gap to narrow with the expected sustained decline in
inflation from 2026 onwards, as well as the recent cost-cutting
measures introduced by the government.
Expenditure Adjustability: 'Midrange'
Mugla has a low share of inflexible costs compared with
international peers, at around 50% of total expenditure on average.
Capex constitutes the remaining 47% of total expenditure, and can
be reduced or postponed given the city's reasonable level of
existing infrastructure. Mugla also has a good record of balanced
budgets, as demonstrated by the surpluses produced before net
financing in 2019-2023.
However, spending flexibility is offset by the moderate
affordability of reduction due to the existing level of services
and investments and persistent high inflation in 2024-2026, but
Fitch expects it to be gradually restored thereafter due to
declining inflation. Mugla's capex should remain about 52% of total
spending during the rating case versus 47% in 2019-2023, focusing
on basic infrastructure investments.
Liabilities & Liquidity Robustness: 'Midrange'
Mugla has the lowest leverage among Fitch-rated peers and has no
unhedged FX exposure. Total debt consists of Turkish
lira-denominated bank loans with floating interest rates. Mugla's
relatively short debt tenor profile, with a weighted-average life
of debt at 2.5 years at 2023 exposes it to some refinancing risk,
but Fitch expects this to be fully offset by the strong actual debt
service coverage ratio of above 9x in 2024-2028, and fully
amortising debt structure. In addition, its unrestricted cash
reserves remained very strong at TRY2.1 billion at end-2023,
covering about 411x of its annual debt obligations.
At end-2023, Mugla's contingent liabilities were mainly from
wholly-owned water and sewage affiliate, MUSKI. A large proportion
of the debt transferred from the metropolitan municipality
districts' water and sewage affiliates added after the Local
Municipal Act in 2014 was repaid in 2022 using Mugla's operating
cash flow. Consequently, Fitch does not expect Mugla to be exposed
to material off-balance-sheet risk.
Liabilities & Liquidity Flexibility: 'Weaker'
Mugla's counterparty risk associated with its domestic liquidity
providers rated below 'BBB-' and with the short tenor of its loans
limits this assessment to 'Weaker'. Mugla's unrestricted cash
reserves, net of receivables minus payables, further improved to
TRY2.1 billion in 2023 from TRY1.2 billion. Mugla has
well-developed relationships with local banks and developing
relationships with international lenders. Turkish local and
regional governments do not benefit from treasury lines or national
cash-pooling, making it challenging to fund unexpected increases in
debt liabilities or spending peaks.
Debt Sustainability: 'aaa category'
Under Fitch's rating case for 2024-2028, Mugla's operating balance
will be about TRY4.7 billion with direct debt totalling TRY2.6
billion in 2028, leading to a strong debt payback ratio (net
adjusted debt to operating balance) at 0.4x well below 5x,
corresponding to the stronger end of 'aaa' debt sustainability
(DS). The assessment is further supported by its forecast of a
solid actual debt service coverage ratio (ADSCR) of 9.5x in 2028
(2023: 448x), corresponding to 'aaa' DS.
This is despite an expected fall in the operating margin from an
average 57% in 2019-2023 to 48% in 2024-2028. Mugla's leverage
remains the lowest among its peers, with a fiscal debt burden (net
adjusted debt to operating revenue) well below 50%, in line with
'aaa' DS.
Derivation Summary
Mugla's 'bbb+' SCP results from a 'Weaker' risk profile and 'aaa'
DS score. The SCP also factors in Mugla's comparison with its
international peers in the same rating category. Mugla's IDRs are
not affected by any other rating factors but are capped by the
Turkish sovereign IDRs (B+/Positive).
Short-Term Ratings
The 'B' Short-Term IDR is the only option for a 'B' category
Long-Term IDR.
National Ratings
Mugla's National Ratings are derived from its 'B+' Long-Term
Local-Currency IDR, which maps to 'AAA(tur)' on the Turkish
National Correspondence Table based on national peer comparison,
which reflects a lower likelihood of Mugla defaulting on its
long-term local-currency obligations.
Key Assumptions
Qualitative Assumptions:
Risk Profile: 'Weaker'
Revenue Robustness: 'Midrange'
Revenue Adjustability: 'Weaker'
Expenditure Sustainability: 'Weaker'
Expenditure Adjustability: 'Midrange'
Liabilities and Liquidity Robustness: 'Midrange'
Liabilities and Liquidity Flexibility: 'Weaker'
Debt sustainability: 'aaa'
Support (Budget Loans): 'N/A'
Support (Ad Hoc): 'N/A'
Asymmetric Risk: 'N/A'
Rating Cap (LT IDR): 'B+'
Rating Cap (LT LC IDR) 'B+'
Rating Floor: 'N/A'
Quantitative assumptions - Issuer Specific
Fitch's rating case is a "through-the-cycle" scenario, which
incorporates a combination of revenue, cost and financial risk
stresses. It is based on 2019-2023 figures and 2024-2028 projected
ratios. The key assumptions for the scenario include:
- Operating revenues CAGR of 29.3% in 2024-2028 (versus 46.7% yoy
for 2019-2023 due to an expected high inflation of 30% on average
in 2024-2028);
-Tax revenue CAGR of 29.4% in 2024-2028, versus 49.3% CAGR in
2019-2023;
- Current transfers CAGR of 29.4% in 2024-2028, versus 45.4% CAGR
in 2019-2023;
- Operating expenses CAGR of 36.2% in 2024-2028 (versus 40.9% yoy
for 2019-2023 due to an expected high inflation of 30% on average
in 2024-2028);
- Negative net capital balance of TRY5.8 billion in 2024-2028;
- Apparent cost of debt on average of 25.2%, which is about 13%
above the average cost of debt in 2023 due to higher borrowing
rates;
- USD/TRY (average) assumptions are based on Fitch's sovereign
estimate for 2024 at USD/TRY36, 2025 at USD/TRY40, 2026 at
USD/TRY44, with additional annual depreciation of 10% for
2027-2028.
Liquidity and Debt Structure
Mugla's total debt remained very low at TRY15 million in 2023, down
from TRY18 million in 2022. Its unrestricted cash increased to
TRY2.1 billion from TRY1.2 billion in 2022, leading to net adjusted
debt of negative TRY2.1 billion (or net cash positive). The
operating balance was nearly TRY2.3 billion, representing 58% of
operating revenue leading to a sound payback ratio of -0.9x in
2023. Mugla is not exposed to material off balance sheet risk.
Contingent liabilities are moderate and stem solely from MUSKI,
which is self-sustaining. In 2023, MUSKI reported a resilient
operating balance leading to a payback ratio at 4.5 x and an ADSCR
of 1.4x.
Fitch expects Mugla to spend on average TRY5.8 billion annually on
investments in the next five years. The investments will be mainly
for basic transportation infrastructure, road construction, urban
landscaping projects involving construction of parks and
environmentally-friendly infrastructure such as solid-waste
management projects.
Issuer Profile
Mugla is located in south-western Turkiye with a population of 1.1
million or 1.2% of the national population, with an increased
population during summer seasons. Mugla's local economy is
dominated by the services sector (63%), largely driven by tourism,
followed by industry (22%) and agriculture (15%). GDP per capita of
TRY186,372 exceeded the national average of TRY176,589 in 2022, in
line with the pre-pandemic periods.
Rating Sensitivities
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
A downgrade of the Turkish sovereign IDRs or a downward revision of
Mugla's SCP resulting from a debt payback ratio of above 13x would
lead to a downgrade of Mugla's IDRs.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
An upgrade of the Turkish sovereign IDRs would lead to similar
rating action on Mugla's IDRs, provided Mugla maintains its debt
payback ratio below 5x under Fitch's rating case.
ESG Considerations
The highest level of ESG credit relevance is a score of '3', unless
otherwise disclosed in this section. A score of '3' means ESG
issues are credit-neutral or have only a minimal credit impact on
the entity, either due to their nature or the way in which they are
being managed by the entity. Fitch's ESG Relevance Scores are not
inputs in the rating process; they are an observation on the
relevance and materiality of ESG factors in the rating decision.
Discussion Note
Committee date: 12 August 2024
There was an appropriate quorum at the committee and the members
confirmed that they were free from recusal. It was agreed that the
data was sufficiently robust relative to its materiality. During
the committee no material issues were raised that were not in the
original committee package. The main rating factors under the
relevant criteria were discussed by the committee members. The
rating decision as discussed in this rating action commentary
reflects the committee discussion.
Public Ratings with Credit Linkage to other ratings
Mugla's IDRs are capped by the Turkish sovereign IDRs.
Entity/Debt Rating Prior
----------- ------ -----
Mugla Metropolitan
Municipality LT IDR B+ Affirmed B+
ST IDR B Affirmed B
LC LT IDR B+ Affirmed B+
Natl LT AAA(tur)Affirmed AAA(tur)
===========================
U N I T E D K I N G D O M
===========================
EUROSAIL 2006-2BL: S&P Lowers Class E1c Notes Rating to 'B (sf)'
----------------------------------------------------------------
S&P Global Ratings lowered to 'B (sf)' from 'BB- (sf)' and to 'CCC
(sf)' from 'B- (sf)' its credit ratings on Eurosail 2006-2BL PLC's
class E1c and F1c notes. At the same time, S&P affirmed its 'A+
(sf)' ratings on the class B1a, B1b, C1a, C1c, D1a, and D1c notes.
Since S&P's previous review, the transaction's performance has
deteriorated. Arrears, as per the March 2024 investor report, have
increased to 30.5% from 23.0%. The percentage increase in arrears
mostly reflects the reduced pool size rather than the actual
increase in arrears.
Cumulative losses have increased marginally to 4.97% from 4.96%
since S&P's previous review.
S&P said, "Our weighted-average foreclosure frequency assumptions
have increased at all rating levels, reflecting higher arrears.
This has been partially offset by lower weighted-average loss
severity assumptions, stemming from a decrease in the current
loan-to-value ratio following house price index growth. However,
considering the transaction's historical loss severity levels, the
latest available data suggests that the portfolio's underlying
properties may have only partially benefited from rising house
prices, and we have therefore applied a haircut to property
valuations to reflect this."
Weighted-average foreclosure frequency and weighted-average loss
severity
WAFF (%) WALS (%) CREDIT COVERAGE (%)
AAA 49.44 22.20 10.97
AA 45.76 14.99 6.86
A 43.58 5.80 2.53
BBB 41.06 2.89 1.19
BB 38.38 2.00 0.77
B 37.71 2.00 0.75
WAFF--Weighted-average foreclosure frequency.
WALS--Weighted-average loss severity.
The reserve fund and liquidity facility are at target and not
amortizing, following the breach in the 90+ days arrears trigger.
Given the transaction's sequential amortization, credit enhancement
has increased since S&P's previous review, which offsets the
deteriorating performance in its cash flow analysis.
Like other Eurosail transactions, both fixed and floating fees for
this deal have increased above their historical averages. These
elevated expenses are attributable to legal complexities arising
from the LIBOR transition. Consequently, S&P anticipates a decline
in fees moving forward and have incorporated various fee scenarios
into our cash flow analysis.
S&P said, "Our cash flow modeling shows that the class B1a to D1c
notes pay timely interest and repay principal at rating levels
above 'A+'. However, our counterparty criteria cap the notes'
maximum achievable rating at our 'A+' long-term issuer credit
rating on Barclays Bank PLC. We therefore affirmed our 'A+ (sf)'
ratings on these notes.
"We lowered our rating on the class E1a notes to 'B (sf)' from 'BB-
(sf)'. The rating reflects our cash flow results and considers
sensitivity to increases in arrears (resulting in higher defaults
and longer recoveries), the borrowers' credit profile, high
interest rate environment, and tail-end risk associated with the
small pool size.
"The class F1c notes do not achieve any rating in our standard or
steady state scenario (actual fees, expected prepayment, no spread
compression, and no commingling stress) cash flow runs. Moreover,
given the low levels of credit enhancement and significant
shortfalls in a steady state scenario, we view these notes as
vulnerable to nonpayment and dependent upon favorable business,
financial, and economic conditions. We therefore lowered our rating
to 'CCC (sf)' from 'B- (sf)'.
"We consider the transaction's resilience in case of additional
stresses to some key variables, in particular defaults and loss
severity, to determine our forward-looking view. We considered the
sensitivity of the ratings to increased defaults, extended
recoveries, and higher interest rates, and the ratings remain
robust. Given its high seasoning (216 months), the transaction has
a low pool factor (12.01%), which tends to amplify movement in
arrears. We have considered the tail-end risk associated with the
low pool factor in our analysis."
Macroeconomic forecasts and forward-looking analysis
S&P said, "We expect interest rates in the U.K. to remain higher
for longer than previously expected.
"We consider the borrowers in this transaction to be nonconforming
and as such generally less resilient to higher interest rates than
prime borrowers. All the borrowers are currently paying a floating
rate of interest and will be affected by higher rates.
"In our view, the ability of the borrowers to repay their mortgage
loans will be highly correlated to macroeconomic conditions and the
complex profile of nonconforming borrowers. Our current forecast on
policy interest rates for the U.K. is 4.5% in 2024, and we forecast
unemployment of 4.3% for both 2024 and 2025.
"Given our current macroeconomic forecasts and forward-looking view
of the U.K. residential mortgage market, we have performed
additional sensitivities related to higher levels of defaults due
to increased arrears and house price declines. We have also
performed additional sensitivities with extended recovery timings
due to observed repossession delays owing to court backlogs in the
U.K. and the repossession grace period under the Mortgage Charter.
The results of the additional sensitivities were in line with the
ratings assigned."
Eurosail 2006-2BL's loan pool comprises first- and second-ranking
mortgages on properties in England, Wales, and Northern Ireland,
and standard securities on properties in Scotland. This transaction
is backed by nonconforming U.K. residential mortgages originated by
Preferred Mortgages Ltd.
RMAC NO.3: Fitch Affirms Bsf Rating on Cl. F Notes, Outlook Stable
------------------------------------------------------------------
Fitch Ratings has affirmed RMAC No. 3 PLC's (RMAC3) notes with
Stable Outlooks, as detailed below:
Entity/Debt Rating Prior
----------- ------ -----
RMAC No.3 PLC
Class A XS2666572693 LT AAAsf Affirmed AAAsf
Class B XS2666572776 LT AAsf Affirmed AAsf
Class C XS2666572933 LT A+sf Affirmed A+sf
Class D XS2666573071 LT Asf Affirmed Asf
Class E XS2666573154 LT BB+sf Affirmed BB+sf
Class F XS2666573238 LT Bsf Affirmed Bsf
Transaction Summary
RMAC3 is a securitisation of UK owner-occupied (OO) and buy-to-let
(BTL) loans originated by GMAC (now Paratus AMC) mainly between
2004 and 2005. The loans were previously securitised under the RMAC
No.1 and RMAC No.2 transactions, not rated by Fitch
KEY RATING DRIVERS
Seasoned Non-Prime Loans: The portfolio consists of seasoned loans,
originated primarily between 2004 and 2005. The OO loans (89.7% of
the pool) contain a high proportion of self-certified,
interest-only, county court judgements and restructured loan
arrangements. Fitch therefore applied its non-conforming
assumptions to the OO sub-pool. When setting the originator
adjustment for the portfolio, Fitch considered factors including
the historical performance of the pool. This resulted in an
originator adjustment of 1.0x for the OO sub-pool and 1.5x for the
BTL sub-pool.
Increase in Restructured Loans: Fitch received loan-level data from
the servicer, which contained a material increase in restructured
loans. As per Fitch's criteria, loans that have been restructured
are subject to an increase to the foreclosure frequency (FF) or an
arrears floor, depending on when the loan was last in arrears. This
had a negative impact on the asset-level model outputs for this
transaction.
Low-margin Loans: The asset pool consists predominantly (93.6%) of
low-margin (with a weighted average (WA) margin of 2.1%)
floating-rate assets that track the Bank of England base rate
(BBR). The majority of the loans are bullet loans, predominantly
maturing between 2028 and 2030.
Reserves Provide Credit, Liquidity Support: The non-amortising
general reserve was sized at a static 1.5% of the class A to Z1
closing balance, for which the liquidity reserve fund is sized at
1.5% of the outstanding balance of the class A and B notes. As the
liquidity portion decreases, in line with amortisation of the class
A and B notes, the portion that can be used to cover for losses
increases, contributing to the available credit enhancement for the
rated notes.
Limited Excess Spread, Principal Drawings: Given the WA margin on
the notes and senior costs, and the low-yielding assets, limited
excess spread will be available. The rated notes need to meet
timely interest payments when they become the most senior
outstanding. Principal funds are available to cover interest
payments on the class A and B notes (subject to principal
deficiency ledger (PDL) conditions) or the most senior notes
outstanding, creating a debit on the PDL of the unrated class Z1
notes, with funds to clear it in many, but not all its stressed
scenarios.
Unhedged Basis Risk: As the notes pay daily compounded SONIA, the
transaction will be exposed to basis risk between BBR and SONIA.
Fitch stressed the transaction's cash flows for basis risk, in line
with its criteria.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
The transaction's performance may be affected by adverse changes in
market conditions and the economic environment. Weakening economic
performance is strongly correlated to increasing levels of
delinquencies and defaults that could reduce credit enhancement
available to the notes.
Additionally, unanticipated declines in recoveries could result in
lower net proceeds, which may make certain notes susceptible to
negative rating action depending on the extent of the decline in
recoveries. Fitch found that a 15% increase in the WA foreclosure
frequency (FF) and 15% decrease in the WA recovery rate (RR) would
result in downgrades of up to seven notches.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
Stable to improved asset performance driven by stable delinquencies
and defaults would lead to increasing credit enhancement and
potentially upgrades. A decrease in the WAFF of 15% and an increase
in the WARR of 15% would result in upgrades of up to five notches
USE OF THIRD PARTY DUE DILIGENCE PURSUANT TO SEC RULE 17G -10
Form ABS Due Diligence-15E was not provided to, or reviewed by,
Fitch in relation to this rating action.
DATA ADEQUACY
Fitch has checked the consistency and plausibility of the
information it has received about the performance of the asset pool
and the transaction. Fitch has not reviewed the results of any
third party assessment of the asset portfolio information or
conducted a review of origination files as part of its ongoing
monitoring.
Prior to the transaction closing, Fitch reviewed the results of a
third party assessment conducted on the asset portfolio information
and concluded that there were no findings that affected the rating
analysis.
Overall, and together with any assumptions referred to above,
Fitch's assessment of the information relied upon for the agency's
rating analysis according to its applicable rating methodologies
indicates that it is adequately reliable.
ESG Considerations
RMAC3 has an ESG Relevance Score of '4' for 'Customer Welfare -
Fair Messaging, Privacy & Data Security' due to legacy origination
practices that include loans advanced with limited affordability
checks, which has a negative impact on the credit profile and is
relevant to the ratings in conjunction with other factors.
RMAC3 has an ESG Relevance Score of '4' for 'Human Rights,
Community Relations, Access & Affordability' due to legacy
originations with a high concentration of interest-only loans,
which has a negative impact on the credit profile and is relevant
to the ratings in conjunction with other factors.
The highest level of ESG credit relevance is a score of '3', unless
otherwise disclosed in this section. A score of '3' means ESG
issues are credit-neutral or have only a minimal credit impact on
the entity, either due to their nature or the way in which they are
being managed by the entity. Fitch's ESG Relevance Scores are not
inputs in the rating process; they are an observation on the
relevance and materiality of ESG factors in the rating decision.
===============
X X X X X X X X
===============
[*] BOND PRICING: For the Week August 19 to August 23, 2024
-----------------------------------------------------------
Issuer Coupon Maturity Currency Price
------ ------ -------- -------- -----
Altice France Holding S 10.500 5/15/2027 USD 39.036
NCO Invest SA 10.000 12/30/2026 EUR 0.139
Ferralum Metals Group S 10.000 12/30/2026 EUR 33.200
NCO Invest SA 10.000 12/30/2026 EUR 0.351
Codere Finance 2 Luxemb 11.000 9/30/2026 EUR 44.859
Solocal Group 10.719 3/15/2025 EUR 22.007
Virgolino de Oliveira F 11.750 2/9/2022 USD 1.062
Codere Finance 2 Luxemb 12.750 11/30/2027 EUR 0.500
Fastator AB 12.500 9/25/2026 SEK 35.028
Virgolino de Oliveira F 10.500 1/28/2018 USD 0.010
Ilija Batljan Invest AB 10.470 SEK 5.062
Oscar Properties Holdin 11.270 7/5/2024 SEK 0.105
Societe Generale SA 20.000 8/29/2024 USD 31.100
Fastator AB 12.500 9/26/2025 SEK 35.386
Turkiye Government Bond 10.400 10/13/2032 TRY 49.000
Virgolino de Oliveira F 10.500 1/28/2018 USD 0.010
IOG Plc 13.217 9/20/2024 EUR 8.000
Immigon Portfolioabbau 10.055 EUR 11.120
Saderea DAC 12.500 11/30/2026 USD 49.000
Tinkoff Bank JSC Via TC 11.002 USD 42.875
Codere Finance 2 Luxemb 13.625 11/30/2027 USD 1.003
Kvalitena AB publ 10.067 4/2/2024 SEK 45.000
Fastator AB 12.500 9/24/2027 SEK 35.000
Virgolino de Oliveira F 11.750 2/9/2022 USD 1.062
R-Logitech Finance SA 10.250 9/26/2027 EUR 15.000
Bilt Paper BV 10.360 USD 0.574
Codere Finance 2 Luxemb 11.000 9/30/2026 EUR 44.859
Codere Finance 2 Luxemb 13.625 11/30/2027 USD 1.003
UkrLandFarming PLC 10.875 3/26/2018 USD 2.078
Plusplus Capital Financ 11.000 7/29/2026 EUR 10.563
Marginalen Bank Bankakt 12.695 SEK 40.002
Transcapitalbank JSC Vi 10.000 USD 1.450
Privatbank CJSC Via UK 10.250 1/23/2018 USD 3.556
Avangardco Investments 10.000 10/29/2018 USD 0.108
Privatbank CJSC Via UK 11.000 2/9/2021 USD 0.500
Bulgaria Steel Finance 12.000 5/4/2013 EUR 0.216
Sidetur Finance BV 10.000 4/20/2016 USD 0.709
Altice France Holding S 10.500 5/15/2027 USD 38.558
Societe Generale SA 20.000 7/21/2026 USD 3.400
Leonteq Securities AG/G 13.500 9/3/2024 CHF 49.490
Codere Finance 2 Luxemb 12.750 11/30/2027 EUR 0.500
Privatbank CJSC Via UK 10.875 2/28/2018 USD 5.307
Virgolino de Oliveira F 10.875 1/13/2020 USD 36.000
Elli Investments Ltd 12.250 6/15/2020 GBP 1.197
Virgolino de Oliveira F 10.875 1/13/2020 USD 36.000
Societe Generale SA 11.000 7/14/2026 USD 14.330
Societe Generale SA 27.300 10/20/2025 USD 7.720
Societe Generale SA 21.000 12/26/2025 USD 26.000
Ameriabank CJSC 10.000 2/20/2025 AMD 0.000
Goldman Sachs Internati 16.288 3/17/2027 USD 24.750
Deutsche Bank AG/London 12.780 3/16/2028 TRY 47.388
Teksid Aluminum Luxembo 12.375 7/15/2011 EUR 0.619
Bilt Paper BV 10.360 USD 0.574
Elli Investments Ltd 12.250 6/15/2020 GBP 1.197
Phosphorus Holdco PLC 10.000 4/1/2019 GBP 0.866
UBS AG 10.000 7/29/2025 USD 34.160
Swissquote Bank SA 15.740 10/31/2024 CHF 18.000
UBS AG/London 17.500 2/7/2025 USD 12.510
Societe Generale SA 18.000 8/30/2024 USD 33.800
UBS AG/London 11.200 8/26/2024 USD 20.510
Societe Generale SA 20.000 11/28/2025 USD 9.200
Vontobel Financial Prod 21.000 9/27/2024 EUR 24.160
Raiffeisen Schweiz Geno 20.000 9/11/2024 CHF 35.830
Bank Vontobel AG 15.500 11/18/2024 CHF 34.900
HSBC Trinkaus & Burkhar 17.700 9/27/2024 EUR 10.370
Leonteq Securities AG/G 10.000 9/10/2024 CHF 39.570
Credit Agricole Corpora 10.200 12/13/2027 TRY 47.426
KPNQwest NV 10.000 3/15/2012 EUR 0.745
Tonon Luxembourg SA 12.500 5/14/2024 USD 2.216
Sidetur Finance BV 10.000 4/20/2016 USD 0.709
Lehman Brothers Treasur 14.900 9/15/2008 EUR 0.100
NTRP Via Interpipe Ltd 10.250 8/2/2017 USD 1.033
Petromena ASA 10.850 11/19/2018 USD 0.622
DZ Bank AG Deutsche Zen 20.400 3/28/2025 EUR 23.620
BNP Paribas Emissions- 24.000 12/30/2024 EUR 49.980
BNP Paribas Emissions- 28.000 9/26/2024 EUR 44.430
DZ Bank AG Deutsche Zen 17.600 6/27/2025 EUR 25.660
Landesbank Baden-Wuertt 15.000 2/28/2025 EUR 12.810
Landesbank Baden-Wuertt 19.000 2/28/2025 EUR 14.100
Bank Vontobel AG 14.000 3/5/2025 CHF 22.500
Landesbank Baden-Wuertt 11.500 2/28/2025 EUR 11.970
Landesbank Baden-Wuertt 10.500 1/2/2026 EUR 16.220
Raiffeisen Switzerland 16.000 3/4/2025 CHF 24.260
Landesbank Baden-Wuertt 16.000 6/27/2025 EUR 16.250
Landesbank Baden-Wuertt 21.000 6/27/2025 EUR 19.680
Landesbank Baden-Wuertt 22.000 1/3/2025 EUR 12.610
Landesbank Baden-Wuertt 16.000 1/3/2025 EUR 11.780
Landesbank Baden-Wuertt 19.000 1/3/2025 EUR 12.130
Landesbank Baden-Wuertt 25.000 1/3/2025 EUR 13.180
Landesbank Baden-Wuertt 14.000 6/27/2025 EUR 15.050
Landesbank Baden-Wuertt 19.000 6/27/2025 EUR 18.340
Landesbank Baden-Wuertt 27.000 9/27/2024 EUR 11.160
Leonteq Securities AG/G 20.000 3/11/2025 CHF 25.480
Bank Vontobel AG 11.000 4/11/2025 CHF 40.900
Vontobel Financial Prod 19.250 6/27/2025 EUR 51.770
Vontobel Financial Prod 17.000 6/27/2025 EUR
Landesbank Baden-Wuertt 11.000 2/27/2026 EUR 18.990
Landesbank Baden-Wuertt 12.000 2/27/2026 EUR 20.210
DZ Bank AG Deutsche Zen 11.500 12/31/2024 EUR 11.800
DZ Bank AG Deutsche Zen 23.100 12/31/2024 EUR 33.140
DZ Bank AG Deutsche Zen 21.500 9/27/2024 EUR 44.880
UBS AG/London 13.000 9/30/2024 CHF 16.760
Vontobel Financial Prod 29.200 1/17/2025 EUR 35.334
Landesbank Baden-Wuertt 23.000 9/27/2024 EUR 42.590
Landesbank Baden-Wuertt 18.000 1/3/2025 EUR 46.890
Landesbank Baden-Wuertt 11.000 1/2/2026 EUR 18.280
Landesbank Baden-Wuertt 16.000 9/27/2024 EUR 48.770
Landesbank Baden-Wuertt 16.000 6/27/2025 EUR 17.060
Landesbank Baden-Wuertt 15.000 1/3/2025 EUR 13.490
Landesbank Baden-Wuertt 18.000 9/27/2024 EUR 16.970
Landesbank Baden-Wuertt 13.000 9/27/2024 EUR 48.530
Landesbank Baden-Wuertt 25.000 9/27/2024 EUR 15.160
Landesbank Baden-Wuertt 16.000 1/2/2026 EUR 23.720
Landesbank Baden-Wuertt 13.000 6/27/2025 EUR 15.370
DZ Bank AG Deutsche Zen 18.500 3/28/2025 EUR 24.150
Landesbank Baden-Wuertt 13.000 4/24/2026 EUR 23.600
Landesbank Baden-Wuertt 10.500 4/24/2026 EUR 20.170
Landesbank Baden-Wuertt 11.500 4/24/2026 EUR 21.460
Landesbank Baden-Wuertt 16.500 4/28/2025 EUR 15.610
Landesbank Baden-Wuertt 10.500 4/28/2025 EUR 12.890
Landesbank Baden-Wuertt 19.000 4/28/2025 EUR 16.880
DZ Bank AG Deutsche Zen 12.800 12/31/2024 EUR 42.800
DZ Bank AG Deutsche Zen 17.300 12/31/2024 EUR 37.750
Vontobel Financial Prod 16.000 3/28/2025 EUR 20.840
DZ Bank AG Deutsche Zen 14.200 12/31/2024 EUR 40.810
Vontobel Financial Prod 15.750 3/28/2025 EUR 51.820
Vontobel Financial Prod 16.500 12/31/2024 EUR 31.900
Vontobel Financial Prod 18.500 12/31/2024 EUR 31.400
Vontobel Financial Prod 20.250 12/31/2024 EUR 30.910
Vontobel Financial Prod 11.250 12/31/2024 EUR 34.390
Vontobel Financial Prod 13.000 12/31/2024 EUR 33.420
Vontobel Financial Prod 14.750 12/31/2024 EUR 32.600
DZ Bank AG Deutsche Zen 20.700 12/31/2024 EUR 35.600
DZ Bank AG Deutsche Zen 14.200 12/31/2024 EUR 11.330
DZ Bank AG Deutsche Zen 11.400 12/31/2024 EUR 45.110
DZ Bank AG Deutsche Zen 15.700 12/31/2024 EUR 39.150
DZ Bank AG Deutsche Zen 19.000 12/31/2024 EUR 36.590
Swissquote Bank Europe 25.320 2/26/2025 CHF 44.810
Landesbank Baden-Wuertt 14.000 1/24/2025 EUR 11.210
UniCredit Bank GmbH 16.300 9/27/2024 EUR 35.570
DZ Bank AG Deutsche Zen 16.500 12/27/2024 EUR 15.520
DZ Bank AG Deutsche Zen 20.250 9/25/2024 EUR 13.060
Vontobel Financial Prod 10.000 3/28/2025 EUR 49.050
DZ Bank AG Deutsche Zen 18.500 9/27/2024 EUR 47.920
Bank Vontobel AG 13.500 1/8/2025 CHF 9.800
Inecobank CJSC 10.000 4/28/2025 AMD 0.000
Leonteq Securities AG 24.000 1/16/2025 CHF 45.690
Vontobel Financial Prod 20.250 12/31/2024 EUR 16.959
Leonteq Securities AG 24.000 1/9/2025 CHF 30.030
Landesbank Baden-Wuertt 11.000 3/28/2025 EUR 10.740
Landesbank Baden-Wuertt 15.000 3/28/2025 EUR 12.080
Vontobel Financial Prod 13.250 9/27/2024 EUR 48.700
DZ Bank AG Deutsche Zen 13.400 12/31/2024 EUR 47.960
DZ Bank AG Deutsche Zen 21.300 12/31/2024 EUR 48.340
UniCredit Bank GmbH 15.100 9/27/2024 EUR 47.050
UniCredit Bank GmbH 16.400 9/27/2024 EUR 44.490
UniCredit Bank GmbH 13.800 9/27/2024 EUR 36.130
UniCredit Bank GmbH 14.800 9/27/2024 EUR 34.640
UniCredit Bank GmbH 15.800 9/27/2024 EUR 33.300
UniCredit Bank GmbH 16.900 9/27/2024 EUR 32.090
UniCredit Bank GmbH 18.000 9/27/2024 EUR 30.980
UniCredit Bank GmbH 19.100 9/27/2024 EUR 29.960
Vontobel Financial Prod 26.450 1/24/2025 EUR 19.117
Landesbank Baden-Wuertt 12.000 1/3/2025 EUR 11.280
Landesbank Baden-Wuertt 15.000 1/3/2025 EUR 11.080
Landesbank Baden-Wuertt 18.000 1/3/2025 EUR 11.490
Leonteq Securities AG/G 11.000 1/9/2025 CHF 39.440
DZ Bank AG Deutsche Zen 14.300 12/31/2024 EUR 47.140
UniCredit Bank GmbH 17.300 9/27/2024 EUR 47.420
BNP Paribas Emissions- 18.000 3/27/2025 EUR 51.890
BNP Paribas Emissions- 22.000 3/27/2025 EUR 51.410
BNP Paribas Emissions- 15.000 9/26/2024 EUR 47.420
Leonteq Securities AG 25.000 1/3/2025 CHF 47.510
Leonteq Securities AG/G 22.000 10/2/2024 CHF 39.850
Leonteq Securities AG 21.000 1/3/2025 CHF 30.760
UniCredit Bank GmbH 18.500 9/27/2024 EUR 33.880
Erste Group Bank AG 14.500 5/31/2026 EUR 31.600
DZ Bank AG Deutsche Zen 10.500 12/27/2024 EUR 43.890
UniCredit Bank GmbH 12.300 9/27/2024 EUR 39.720
UniCredit Bank GmbH 14.200 9/27/2024 EUR 37.500
Vontobel Financial Prod 14.750 12/31/2024 EUR 50.170
Leonteq Securities AG/G 25.000 9/5/2024 EUR 40.230
Leonteq Securities AG/G 24.000 9/5/2024 CHF 43.500
Landesbank Baden-Wuertt 10.000 11/22/2024 EUR 41.550
Landesbank Baden-Wuertt 10.500 11/22/2024 EUR 11.230
Landesbank Baden-Wuertt 16.000 11/22/2024 EUR 10.390
Landesbank Baden-Wuertt 13.000 3/28/2025 EUR 11.360
DZ Bank AG Deutsche Zen 18.200 3/28/2025 EUR 49.740
Societe Generale SA 18.000 8/30/2024 USD 19.400
UniCredit Bank GmbH 19.100 12/31/2024 EUR 34.500
UniCredit Bank GmbH 20.000 12/31/2024 EUR 33.380
Vontobel Financial Prod 11.000 12/31/2024 EUR 30.880
UniCredit Bank GmbH 10.700 9/27/2024 EUR 49.310
DZ Bank AG Deutsche Zen 10.750 12/27/2024 EUR 12.650
ASCE Group OJSC 12.000 6/11/2031 AMD 0.000
DZ Bank AG Deutsche Zen 10.600 9/27/2024 EUR 45.550
Societe Generale SA 15.110 10/31/2024 USD 21.500
Societe Generale SA 15.600 8/25/2026 USD 39.830
HSBC Trinkaus & Burkhar 14.500 12/30/2024 EUR 8.110
DZ Bank AG Deutsche Zen 13.200 9/27/2024 EUR 49.550
DZ Bank AG Deutsche Zen 10.500 1/22/2025 EUR 11.120
Leonteq Securities AG/G 10.340 8/31/2026 EUR 49.880
UniCredit Bank GmbH 19.300 12/31/2024 EUR 35.680
Leonteq Securities AG/G 23.290 8/29/2024 CHF 42.230
Leonteq Securities AG 24.000 9/5/2024 CHF 40.140
Vontobel Financial Prod 15.500 9/27/2024 EUR 44.940
UniCredit Bank GmbH 10.700 2/28/2025 EUR 35.660
UniCredit Bank GmbH 11.700 2/28/2025 EUR 34.620
UniCredit Bank GmbH 12.800 2/28/2025 EUR 33.510
UniCredit Bank GmbH 14.500 11/22/2024 EUR 38.220
UniCredit Bank GmbH 13.100 2/28/2025 EUR 42.570
UniCredit Bank GmbH 13.800 2/28/2025 EUR 41.450
UniCredit Bank GmbH 14.500 2/28/2025 EUR 40.240
Societe Generale SA 20.000 1/29/2026 USD 9.800
UniCredit Bank GmbH 13.700 9/27/2024 EUR 45.850
Vontobel Financial Prod 13.000 12/31/2024 EUR 36.670
Vontobel Financial Prod 16.750 12/31/2024 EUR 34.640
Vontobel Financial Prod 17.250 12/31/2024 EUR 47.960
Vontobel Financial Prod 20.000 12/31/2024 EUR 46.200
DZ Bank AG Deutsche Zen 15.500 12/31/2024 EUR 43.130
Vontobel Financial Prod 12.500 9/27/2024 EUR 45.540
Leonteq Securities AG 28.000 9/5/2024 CHF 35.260
Vontobel Financial Prod 11.000 12/31/2024 EUR 37.940
Vontobel Financial Prod 14.750 12/31/2024 EUR 35.530
Leonteq Securities AG 24.000 9/4/2024 CHF 39.680
Swissquote Bank SA 27.700 9/4/2024 CHF 51.790
Finca Uco Cjsc 12.000 2/10/2025 AMD 0.000
DZ Bank AG Deutsche Zen 13.900 3/28/2025 EUR 15.190
DZ Bank AG Deutsche Zen 14.000 9/25/2024 EUR 11.270
UBS AG/London 10.000 3/23/2026 USD 29.450
Societe Generale SA 15.000 9/29/2025 USD 8.400
UBS AG/London 21.600 8/2/2027 SEK 32.960
Evocabank CJSC 11.000 9/28/2024 AMD 8.908
Societe Generale SA 20.000 9/18/2026 USD 12.500
UBS AG/London 20.000 11/29/2024 USD 17.614
Raiffeisen Schweiz Geno 19.000 10/2/2024 CHF 41.990
DZ Bank AG Deutsche Zen 12.000 9/25/2024 EUR 12.970
HSBC Trinkaus & Burkhar 14.500 9/27/2024 EUR 16.980
Leonteq Securities AG 25.000 12/11/2024 CHF 52.390
Landesbank Baden-Wuertt 16.000 10/25/2024 EUR 12.110
Leonteq Securities AG 20.000 8/30/2024 CHF 38.990
Landesbank Baden-Wuertt 13.000 10/25/2024 EUR 13.190
Landesbank Baden-Wuertt 11.500 10/25/2024 EUR 13.940
Leonteq Securities AG 24.000 1/13/2025 CHF 14.260
Raiffeisen Schweiz Geno 10.000 10/4/2024 CHF 38.060
UniCredit Bank GmbH 16.550 8/18/2025 USD 22.580
Vontobel Financial Prod 10.000 9/27/2024 EUR 30.050
Landesbank Baden-Wuertt 10.000 10/24/2025 EUR 15.400
Landesbank Baden-Wuertt 14.000 10/24/2025 EUR 18.720
Leonteq Securities AG 21.000 10/30/2024 CHF 37.640
Vontobel Financial Prod 14.000 9/27/2024 EUR 48.040
Landesbank Baden-Wuertt 15.000 9/27/2024 EUR 12.550
Landesbank Baden-Wuertt 17.000 9/27/2024 EUR 11.680
Landesbank Baden-Wuertt 18.500 9/27/2024 EUR 11.210
HSBC Trinkaus & Burkhar 11.250 6/27/2025 EUR 41.680
HSBC Trinkaus & Burkhar 11.900 9/27/2024 EUR 32.320
HSBC Trinkaus & Burkhar 15.200 12/30/2024 EUR 30.230
HSBC Trinkaus & Burkhar 13.100 12/30/2024 EUR 32.200
BNP Paribas Issuance BV 19.000 9/18/2026 EUR 0.980
HSBC Trinkaus & Burkhar 22.250 6/27/2025 EUR 17.090
HSBC Trinkaus & Burkhar 17.500 6/27/2025 EUR 13.610
HSBC Trinkaus & Burkhar 12.750 6/27/2025 EUR 10.880
HSBC Trinkaus & Burkhar 10.250 6/27/2025 EUR 37.300
HSBC Trinkaus & Burkhar 15.500 6/27/2025 EUR 36.410
UBS AG/London 14.500 10/14/2024 CHF 33.500
UniCredit Bank GmbH 13.400 9/27/2024 EUR 41.840
UniCredit Bank GmbH 18.000 12/31/2024 EUR 29.650
UniCredit Bank GmbH 19.600 12/31/2024 EUR 28.390
UniCredit Bank GmbH 10.000 11/22/2024 EUR 38.400
UniCredit Bank GmbH 13.000 11/22/2024 EUR 33.420
UniCredit Bank GmbH 11.900 11/22/2024 EUR 34.840
UBS AG/London 12.000 11/4/2024 EUR 47.650
HSBC Trinkaus & Burkhar 17.300 9/27/2024 EUR 34.810
HSBC Trinkaus & Burkhar 14.100 12/30/2024 EUR 31.140
HSBC Trinkaus & Burkhar 13.400 6/27/2025 EUR 35.160
HSBC Trinkaus & Burkhar 15.200 12/30/2024 EUR 6.380
HSBC Trinkaus & Burkhar 16.300 3/28/2025 EUR 9.060
HSBC Trinkaus & Burkhar 10.200 10/25/2024 EUR 34.860
HSBC Trinkaus & Burkhar 15.400 9/27/2024 EUR 43.870
HSBC Trinkaus & Burkhar 14.400 3/28/2025 EUR 8.170
HSBC Trinkaus & Burkhar 15.700 11/22/2024 EUR 28.910
HSBC Trinkaus & Burkhar 10.000 11/22/2024 EUR 35.530
Vontobel Financial Prod 22.500 9/27/2024 EUR 41.590
Vontobel Financial Prod 20.500 9/27/2024 EUR 44.100
Vontobel Financial Prod 17.000 9/27/2024 EUR
Vontobel Financial Prod 18.000 9/27/2024 EUR
Vontobel Financial Prod 15.500 9/27/2024 EUR
Vontobel Financial Prod 19.500 9/27/2024 EUR
Vontobel Financial Prod 12.000 9/27/2024 EUR
UBS AG/London 11.590 5/1/2025 USD 9.890
HSBC Trinkaus & Burkhar 15.100 3/28/2025 EUR 32.380
HSBC Trinkaus & Burkhar 19.600 11/22/2024 EUR 6.980
HSBC Trinkaus & Burkhar 12.800 3/28/2025 EUR 48.490
HSBC Trinkaus & Burkhar 14.800 12/30/2024 EUR 39.630
HSBC Trinkaus & Burkhar 11.200 12/30/2024 EUR 46.580
HSBC Trinkaus & Burkhar 18.000 9/27/2024 EUR 25.730
HSBC Trinkaus & Burkhar 16.000 3/28/2025 EUR 31.840
HSBC Trinkaus & Burkhar 11.500 6/27/2025 EUR 37.360
HSBC Trinkaus & Burkhar 17.500 9/27/2024 EUR 8.640
HSBC Trinkaus & Burkhar 13.900 12/30/2024 EUR 47.070
Vontobel Financial Prod 18.500 9/27/2024 EUR 46.980
Vontobel Financial Prod 13.000 9/27/2024 EUR
Vontobel Financial Prod 14.000 9/27/2024 EUR
Leonteq Securities AG/G 20.000 9/26/2024 USD 14.830
Banque Internationale a 20.000 8/30/2024 EUR 50.610
Vontobel Financial Prod 24.500 9/27/2024 EUR 9.326
Corner Banca SA 10.000 11/8/2024 CHF 47.240
HSBC Trinkaus & Burkhar 13.400 12/30/2024 EUR 41.840
HSBC Trinkaus & Burkhar 11.000 3/28/2025 EUR 36.300
HSBC Trinkaus & Burkhar 13.100 10/25/2024 EUR 30.850
HSBC Trinkaus & Burkhar 12.800 11/22/2024 EUR 31.670
HSBC Trinkaus & Burkhar 15.400 9/27/2024 EUR 27.940
HSBC Trinkaus & Burkhar 12.100 9/27/2024 EUR 31.450
HSBC Trinkaus & Burkhar 11.400 12/30/2024 EUR 34.050
Leonteq Securities AG/G 13.000 10/21/2024 EUR 48.720
UniCredit Bank GmbH 10.900 11/22/2024 EUR 36.500
Raiffeisen Schweiz Geno 10.000 12/31/2024 CHF 49.580
UBS AG/London 15.750 10/21/2024 CHF 35.200
Landesbank Baden-Wuertt 18.000 11/22/2024 EUR 10.150
HSBC Trinkaus & Burkhar 19.600 12/30/2024 EUR 8.350
DZ Bank AG Deutsche Zen 16.800 9/27/2024 EUR 46.910
DZ Bank AG Deutsche Zen 23.500 9/27/2024 EUR 38.190
HSBC Trinkaus & Burkhar 12.900 12/30/2024 EUR 49.750
DZ Bank AG Deutsche Zen 17.800 9/27/2024 EUR 31.000
DZ Bank AG Deutsche Zen 17.900 9/27/2024 EUR 46.500
Zurcher Kantonalbank Fi 12.000 10/4/2024 EUR 50.180
Landesbank Baden-Wuertt 11.000 11/22/2024 EUR 11.340
Landesbank Baden-Wuertt 14.500 11/22/2024 EUR 10.480
HSBC Trinkaus & Burkhar 20.000 9/27/2024 EUR 11.830
HSBC Trinkaus & Burkhar 17.400 12/30/2024 EUR 7.980
Leonteq Securities AG 20.000 8/28/2024 CHF 5.500
UniCredit Bank GmbH 14.700 11/22/2024 EUR 39.980
UniCredit Bank GmbH 14.200 11/22/2024 EUR 30.940
Vontobel Financial Prod 18.000 9/27/2024 EUR 25.180
Leonteq Securities AG 24.000 8/28/2024 CHF 43.920
Swissquote Bank SA 23.200 8/28/2024 CHF 40.520
Leonteq Securities AG/G 22.000 8/28/2024 CHF 43.600
Raiffeisen Schweiz Geno 20.000 8/28/2024 CHF 8.930
UniCredit Bank GmbH 10.700 11/22/2024 EUR 43.820
UniCredit Bank GmbH 10.400 2/28/2025 EUR 46.350
UniCredit Bank GmbH 11.600 2/28/2025 EUR 44.180
UniCredit Bank GmbH 13.900 11/22/2024 EUR 41.700
UniCredit Bank GmbH 13.500 2/28/2025 EUR 44.890
Vontobel Financial Prod 18.000 9/27/2024 EUR 43.870
Raiffeisen Schweiz Geno 12.000 9/4/2024 CHF 41.360
Basler Kantonalbank 22.000 9/6/2024 CHF 36.810
Vontobel Financial Prod 13.500 9/27/2024 EUR 50.050
UniCredit Bank GmbH 12.900 11/22/2024 EUR 32.010
HSBC Trinkaus & Burkhar 17.600 9/27/2024 EUR 32.060
HSBC Trinkaus & Burkhar 11.800 9/27/2024 EUR 30.580
HSBC Trinkaus & Burkhar 11.100 12/30/2024 EUR 33.110
HSBC Trinkaus & Burkhar 15.600 11/22/2024 EUR 28.320
HSBC Trinkaus & Burkhar 10.300 11/22/2024 EUR 33.630
BNP Paribas Emissions- 17.000 12/30/2024 EUR 31.320
DZ Bank AG Deutsche Zen 14.000 9/27/2024 EUR 42.830
UniCredit Bank GmbH 12.800 10/10/2024 EUR 49.030
Vontobel Financial Prod 13.250 9/27/2024 EUR 27.640
DZ Bank AG Deutsche Zen 10.800 9/27/2024 EUR 37.030
Vontobel Financial Prod 12.500 12/31/2024 EUR 36.480
Vontobel Financial Prod 10.750 12/31/2024 EUR 37.840
Swissquote Bank SA 24.040 9/11/2024 CHF 36.820
Leonteq Securities AG/G 22.000 9/11/2024 CHF 35.710
Leonteq Securities AG 18.000 9/11/2024 CHF 8.180
UniCredit Bank GmbH 13.700 9/27/2024 EUR 39.740
Raiffeisen Schweiz Geno 20.000 10/16/2024 CHF 26.940
Vontobel Financial Prod 14.250 12/31/2024 EUR 35.340
UniCredit Bank GmbH 14.800 9/27/2024 EUR 37.930
HSBC Trinkaus & Burkhar 12.500 12/30/2024 EUR 40.620
HSBC Trinkaus & Burkhar 17.800 9/27/2024 EUR 25.170
HSBC Trinkaus & Burkhar 16.100 12/30/2024 EUR 28.860
HSBC Trinkaus & Burkhar 15.000 3/28/2025 EUR 31.800
HSBC Trinkaus & Burkhar 11.300 6/27/2025 EUR 36.460
HSBC Trinkaus & Burkhar 12.600 11/22/2024 EUR 30.870
HSBC Trinkaus & Burkhar 15.100 12/30/2024 EUR 36.720
HSBC Trinkaus & Burkhar 10.800 12/30/2024 EUR 44.090
HSBC Trinkaus & Burkhar 15.900 3/28/2025 EUR 31.310
HSBC Trinkaus & Burkhar 13.300 6/27/2025 EUR 34.810
HSBC Trinkaus & Burkhar 12.800 10/25/2024 EUR 30.030
HSBC Trinkaus & Burkhar 10.400 10/25/2024 EUR 32.960
DZ Bank AG Deutsche Zen 20.400 9/27/2024 EUR 40.120
Vontobel Financial Prod 20.500 9/27/2024 EUR 36.560
Vontobel Financial Prod 18.500 9/27/2024 EUR 49.470
Vontobel Financial Prod 20.000 9/27/2024 EUR 47.990
Armenian Economy Develo 10.500 5/4/2025 AMD 0.000
Corner Banca SA 18.500 9/23/2024 CHF 7.130
Landesbank Baden-Wuertt 12.000 1/24/2025 EUR 10.430
Vontobel Financial Prod 18.000 9/27/2024 EUR 49.090
Landesbank Baden-Wuertt 15.500 1/24/2025 EUR 10.730
DZ Bank AG Deutsche Zen 12.000 9/25/2024 EUR 12.220
Vontobel Financial Prod 15.500 9/27/2024 EUR 52.110
Vontobel Financial Prod 14.100 7/28/2026 EUR 37.892
DZ Bank AG Deutsche Zen 11.800 9/27/2024 EUR 47.390
Bank Vontobel AG 10.000 11/4/2024 EUR 48.200
Leonteq Securities AG/G 10.000 11/12/2024 CHF 48.720
Leonteq Securities AG/G 12.000 11/29/2024 USD 50.570
UniCredit Bank GmbH 10.500 12/22/2025 EUR 46.590
Armenian Economy Develo 11.000 10/3/2025 AMD 0.000
HSBC Trinkaus & Burkhar 18.900 9/27/2024 EUR 12.710
DZ Bank AG Deutsche Zen 13.100 9/27/2024 EUR 29.830
DZ Bank AG Deutsche Zen 10.000 9/27/2024 EUR 34.790
DZ Bank AG Deutsche Zen 11.000 9/27/2024 EUR 32.940
UniCredit Bank GmbH 18.100 9/5/2024 EUR 29.020
Bank Vontobel AG 20.500 11/4/2024 CHF 38.200
Landesbank Baden-Wuertt 10.000 10/25/2024 EUR 7.520
ACBA Bank OJSC 11.500 3/1/2026 AMD 0.000
Evocabank CJSC 11.000 9/27/2025 AMD 0.000
Bank Julius Baer & Co L 12.720 2/17/2025 CHF 33.000
EFG International Finan 11.120 12/27/2024 EUR 39.670
DZ Bank AG Deutsche Zen 14.400 9/27/2024 EUR 35.780
Leonteq Securities AG/G 12.000 10/11/2024 EUR 45.970
DZ Bank AG Deutsche Zen 12.000 9/27/2024 EUR 37.220
HSBC Trinkaus & Burkhar 18.300 9/27/2024 EUR 40.150
HSBC Trinkaus & Burkhar 15.900 9/27/2024 EUR 44.490
Leonteq Securities AG/G 15.000 9/12/2024 USD 3.800
UniCredit Bank GmbH 19.300 12/31/2024 EUR 36.870
UniCredit Bank GmbH 18.500 12/31/2024 EUR 37.920
Vontobel Financial Prod 19.000 9/27/2024 EUR 46.990
Vontobel Financial Prod 22.250 9/27/2024 EUR 44.220
UniCredit Bank GmbH 17.200 12/31/2024 EUR 30.170
UniCredit Bank GmbH 18.800 12/31/2024 EUR 32.420
Leonteq Securities AG 20.000 9/18/2024 CHF 23.090
UniCredit Bank GmbH 19.700 12/31/2024 EUR 31.820
Leonteq Securities AG 24.000 9/25/2024 CHF 41.080
Raiffeisen Schweiz Geno 20.000 9/25/2024 CHF 24.240
UniCredit Bank GmbH 18.800 12/31/2024 EUR 28.810
Raiffeisen Schweiz Geno 20.000 9/25/2024 CHF 26.910
HSBC Trinkaus & Burkhar 10.250 9/27/2024 EUR 43.460
Finca Uco Cjsc 13.000 5/30/2025 AMD 0.000
Vontobel Financial Prod 13.250 12/31/2024 EUR 50.280
UniCredit Bank GmbH 10.300 9/27/2024 EUR 26.060
UniCredit Bank GmbH 18.900 12/31/2024 EUR 44.530
UniCredit Bank GmbH 18.000 12/31/2024 EUR 46.340
UniCredit Bank GmbH 19.800 12/31/2024 EUR 42.930
HSBC Trinkaus & Burkhar 13.400 3/28/2025 EUR 33.830
Bank Julius Baer & Co L 11.150 11/25/2024 USD 50.150
DZ Bank AG Deutsche Zen 20.500 12/31/2024 EUR 51.350
Vontobel Financial Prod 16.000 9/27/2024 EUR 50.260
Vontobel Financial Prod 12.000 9/27/2024 EUR 40.000
Vontobel Financial Prod 17.000 9/27/2024 EUR 35.800
Vontobel Financial Prod 19.750 9/27/2024 EUR 34.100
Vontobel Financial Prod 10.000 9/27/2024 EUR 42.640
Vontobel Financial Prod 14.500 9/27/2024 EUR 37.760
UniCredit Bank GmbH 10.700 2/3/2025 EUR 22.550
UniCredit Bank GmbH 10.700 2/17/2025 EUR 22.810
Raiffeisen Schweiz Geno 15.000 1/22/2025 CHF 51.160
Leonteq Securities AG/G 20.000 1/22/2025 CHF 18.190
HSBC Trinkaus & Burkhar 11.600 3/28/2025 EUR 35.770
HSBC Trinkaus & Burkhar 18.100 12/30/2024 EUR 7.450
HSBC Trinkaus & Burkhar 15.700 12/30/2024 EUR 7.080
HSBC Trinkaus & Burkhar 16.300 12/30/2024 EUR 29.440
Landesbank Baden-Wuertt 10.000 6/27/2025 EUR 13.270
Landesbank Baden-Wuertt 14.000 6/27/2025 EUR 15.170
UniCredit Bank GmbH 18.600 12/31/2024 EUR 40.830
UniCredit Bank GmbH 19.500 12/31/2024 EUR 39.560
HSBC Trinkaus & Burkhar 16.800 9/27/2024 EUR 26.770
HSBC Trinkaus & Burkhar 11.100 12/30/2024 EUR 34.840
DZ Bank AG Deutsche Zen 14.000 12/20/2024 EUR 46.500
HSBC Trinkaus & Burkhar 14.300 9/27/2024 EUR 29.240
Zurcher Kantonalbank Fi 24.000 11/22/2024 EUR 47.260
Bank Vontobel AG 29.000 9/10/2024 USD 32.300
BNP Paribas Issuance BV 20.000 9/18/2026 EUR 35.680
BNP Paribas Emissions- 16.000 12/30/2024 EUR 32.150
BNP Paribas Emissions- 17.000 12/30/2024 EUR 48.080
Raiffeisen Schweiz Geno 18.800 9/18/2024 CHF 39.730
Leonteq Securities AG 24.000 12/27/2024 CHF 42.450
Leonteq Securities AG 23.000 12/27/2024 CHF 29.550
HSBC Trinkaus & Burkhar 18.750 9/27/2024 EUR 27.780
HSBC Trinkaus & Burkhar 10.250 12/30/2024 EUR 45.810
HSBC Trinkaus & Burkhar 17.500 12/30/2024 EUR 31.860
UniCredit Bank GmbH 10.500 9/23/2024 EUR 25.520
Landesbank Baden-Wuertt 11.500 9/27/2024 EUR 10.930
Bank Vontobel AG 11.000 9/10/2024 EUR 50.300
Landesbank Baden-Wuertt 15.500 9/27/2024 EUR 8.980
UBS AG/London 11.250 9/16/2024 EUR 47.350
Landesbank Baden-Wuertt 13.000 1/3/2025 EUR 8.920
Landesbank Baden-Wuertt 11.000 1/3/2025 EUR 8.760
UBS AG/London 10.500 9/23/2024 EUR 49.800
Finca Uco Cjsc 13.000 11/16/2024 AMD 0.000
National Mortgage Co RC 12.000 3/30/2026 AMD 0.000
Corner Banca SA 14.000 9/3/2024 EUR 47.240
HSBC Trinkaus & Burkhar 14.400 9/27/2024 EUR 46.820
UniCredit Bank GmbH 10.500 4/7/2026 EUR 37.540
Bank Vontobel AG 10.000 9/2/2024 EUR 46.800
ACBA Bank OJSC 11.000 12/1/2025 AMD 9.654
Landesbank Baden-Wuertt 11.500 10/25/2024 EUR 7.080
Citigroup Global Market 25.530 2/18/2025 EUR 0.010
Lehman Brothers Treasur 11.000 6/29/2009 EUR 0.100
Lehman Brothers Treasur 10.000 6/11/2038 JPY 0.100
Lehman Brothers Treasur 15.000 3/30/2011 EUR 0.100
Lehman Brothers Treasur 13.000 7/25/2012 EUR 0.100
Lehman Brothers Treasur 18.250 10/2/2008 USD 0.100
Lehman Brothers Treasur 12.000 7/13/2037 JPY 0.100
Lehman Brothers Treasur 11.000 12/20/2017 AUD 0.100
Lehman Brothers Treasur 10.000 10/23/2008 USD 0.100
Lehman Brothers Treasur 10.000 10/22/2008 USD 0.100
Lehman Brothers Treasur 10.000 6/17/2009 USD 0.100
Lehman Brothers Treasur 11.250 12/31/2008 USD 0.100
Bulgaria Steel Finance 12.000 5/4/2013 EUR 0.216
Lehman Brothers Treasur 14.900 11/16/2010 EUR 0.100
Lehman Brothers Treasur 11.000 2/16/2009 CHF 0.100
Lehman Brothers Treasur 13.000 2/16/2009 CHF 0.100
Lehman Brothers Treasur 17.000 6/2/2009 USD 0.100
BNP Paribas Emissions- 18.000 9/26/2024 EUR 49.260
BNP Paribas Emissions- 20.000 9/26/2024 EUR 49.440
Banco Espirito Santo SA 10.000 12/6/2021 EUR 0.058
BLT Finance BV 12.000 2/10/2015 USD 10.500
UkrLandFarming PLC 10.875 3/26/2018 USD 2.078
Privatbank CJSC Via UK 10.875 2/28/2018 USD 5.307
BNP Paribas Emissions- 15.000 12/30/2024 EUR 32.450
BNP Paribas Emissions- 11.000 12/30/2024 EUR 33.940
BNP Paribas Emissions- 12.000 12/30/2024 EUR 32.790
UniCredit Bank GmbH 11.600 8/30/2024 EUR 46.270
Tonon Luxembourg SA 12.500 5/14/2024 USD 2.216
BNP Paribas Emissions- 10.000 12/30/2024 EUR 35.250
DZ Bank AG Deutsche Zen 17.300 6/27/2025 EUR 28.090
PA Resources AB 13.500 3/3/2016 SEK 0.124
Tailwind Energy Chinook 12.500 9/27/2019 USD 1.500
Phosphorus Holdco PLC 10.000 4/1/2019 GBP 0.866
Lehman Brothers Treasur 10.500 8/9/2010 EUR 0.100
Lehman Brothers Treasur 10.000 3/27/2009 USD 0.100
Lehman Brothers Treasur 11.000 12/19/2011 USD 0.100
Lehman Brothers Treasur 13.500 11/28/2008 USD 0.100
Lehman Brothers Treasur 16.000 10/8/2008 CHF 0.100
Lehman Brothers Treasur 11.000 12/20/2017 AUD 0.100
Lehman Brothers Treasur 11.000 12/20/2017 AUD 0.100
Lehman Brothers Treasur 10.000 2/16/2009 CHF 0.100
Lehman Brothers Treasur 11.750 3/1/2010 EUR 0.100
Lehman Brothers Treasur 16.000 10/28/2008 USD 0.100
Lehman Brothers Treasur 16.200 5/14/2009 USD 0.100
Lehman Brothers Treasur 10.600 4/22/2014 MXN 0.100
Lehman Brothers Treasur 16.000 11/9/2008 USD 0.100
Lehman Brothers Treasur 13.500 6/2/2009 USD 0.100
Lehman Brothers Treasur 10.000 5/22/2009 USD 0.100
Lehman Brothers Treasur 15.000 6/4/2009 CHF 0.100
Lehman Brothers Treasur 10.442 11/22/2008 CHF 0.100
Lehman Brothers Treasur 23.300 9/16/2008 USD 0.100
Lehman Brothers Treasur 12.400 6/12/2009 USD 0.100
Lehman Brothers Treasur 11.000 7/4/2011 USD 0.100
Lehman Brothers Treasur 11.000 7/4/2011 CHF 0.100
Lehman Brothers Treasur 12.000 7/4/2011 EUR 0.100
Lehman Brothers Treasur 16.000 12/26/2008 USD 0.100
Lehman Brothers Treasur 13.432 1/8/2009 ILS 0.100
Lehman Brothers Treasur 13.150 10/30/2008 USD 0.100
Lehman Brothers Treasur 16.800 8/21/2009 USD 0.100
Lehman Brothers Treasur 14.100 11/12/2008 USD 0.100
Lehman Brothers Treasur 13.000 12/14/2012 USD 0.100
BNP Paribas Emissions- 24.000 9/26/2024 EUR 46.170
*********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter-Europe is a daily newsletter co-
published by Bankruptcy Creditors' Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA.
Marites O. Claro, Rousel Elaine T. Fernandez, Joy A. Agravante,
Julie Anne L. Toledo, Ivy B. Magdadaro, and Peter A. Chapman,
Editors.
Copyright 2024. All rights reserved. ISSN 1529-2754.
This material is copyrighted and any commercial use, resale or
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The TCR Europe subscription rate is US$775 per half-year,
delivered via e-mail. Additional e-mail subscriptions for
members of the same firm for the term of the initial subscription
or balance thereof are US$25 each. For subscription information,
contact Peter Chapman at 215-945-7000.
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