fixed income research corporate bond strategy · in particular, higher debt levels and increased...

Please see important disclosure on the last page of this study.

Topics Page

Market environment Market overview 2

Primary market 3

Focus topic Impact of Trump’s election on corporates 5

ECB tracker Monthly analysis of the CSPP 7

CDS performance New issues vs. ECB 11

Rating changes For the period from 1 January 2017 to 31 January 2017 12

New issues In the period from 1 January 2017 to 31 January 2017 14

Annex Charts & diagrams 16

NORD/LB Research portal PROFI Bloomberg code: NRDR <GO>

Fixed Income Research

Corporate Bond Strategy 10th February 2017 02/2017 No. 6

https://www.nordlb-bison.de/mip4/profi/faces/ctrl.jsp?cat=1340https://www.nordlb-bison.de/mip4/profi/faces/ctrl.jsp?cat=1340

bbg://screens/NRDR

Corporate Bond Strategy 10th February 2017 No. 6

NORD/LB Fixed Income Research page 2 of 23

Market environment Market overview

Analysts:

Martin Strohmeier

Kai Witt

The performance of corporate bonds varied in January. No significant

increase in risk aversion was noticeable for corporate bonds, despite

Trump’s inauguration and the daily Twitter storm. However, the traditionally

strong month of January in the primary market slightly affected risk

premiums in the investment grade segment.

Trump and tapering concerns

influence the market

Fears that the ECB might start tapering earlier in 2017 (than already priced

in by the markets) were the key driver for the trend in investment grade

spreads in recent weeks (along with the Trump effect). Additional warning

signs of a dampening trend in key ratios at companies are visible as a result

of the CSPP. In particular, higher debt levels and increased M&A activities in

Europe have resulted in distorted perception and pricing of risks since mid-

2016. If the ECB leaves the corporate bond market and the CSPP is no

longer a support factor in the medium term, an adjustment in prices would be

the logical consequence. Although the forward guidance communicated by

Mario Draghi should reduce tapering fears, as has been the case in the past,

this would only soften the blow rather than preventing it. It is worth pointing

out that the introduction of the CSPP generated risks in the markets, which

will only become evident once the programme expires. Credit risks are not

currently priced in adequately.

Corporates are front-loading

to avoid tapering uncertainty

in HY2 2017

Although some of the risks are evident at companies (e.g. increase in debt

ratios), the corporate primary market started the new year with a record

volume of EUR 34bn. Following a record year in 2016, issuing activities have

continued at a high level. Overall, we expect strong issuance levels in 2017,

since companies will probably front-load in the first half of the year due to

concerns about an early reduction of CSPP bond buying and in view of an

anticipated minor increase in interest rates. In our opinion, the tapering

discussion will dominate the second half of this year, with spread widening

being the logical consequence. In view of the rising yields on European

government bonds since Trump’s election, market players are currently

pricing EUR IG corporate bonds as a less attractive investment relative to

sovereign bonds. The prevailing trend of yield investors investing in

investment grade corporate bonds may actually be broken in the course of

2017 if yields on government bonds continue to increase. Institutional

investors would then again be able to achieve their target yields in the less

risky government bond market as IG EUR corporate credits additionally

accrue a higher credit risk which is not currently being compensated for to a

sufficient extent.



Bank Lending Survey

indicates further growth in

borrowing by companies

The quarterly Bank Lending Survey published in January 2017 on lending in

the eurozone highlighted that lending growth has continued to be supported

by rising demand in all loan categories. At the same time, the terms for loans

to companies have stabilised on a broad basis. On balance, credit standards

were somewhat more stringent, which was mainly attributable to

developments in the Netherlands. While the net balance was 0% in the

previous quarter, it now is 3%. This is the first tightening of credit guidelines

since the fourth quarter of 2013. However, the trend already emerged in the

previous survey. No immediate impact of the more stringent credit standards

at companies is currently evident on the bond market. However in the future,

it cannot be ruled out that investors demand a higher compensation premium

for the credit risks they are exposed to. In view of rising inflation expectations

in the eurozone and increasing yields on government bonds, companies

continued to be busy raising funds in the capital market. To date, this has

been met with sufficient demand from investors. We expect placement

potential to diminish in the second half of the year, with the resultant

increases in spreads.

Market environment Primary market

Record year followed by

record month

The corporate market is chasing one record after another. Following the

previous year’s record issuance volume of EUR 387bn, the trend continued

seamlessly in January 2017. In the first month of the current financial year, a

total amount of EUR 34bn was issued.

Start of the year in the corporate bond market Monthly overview of maturities in 2017

0

5

10

15

20

25

30

35

Amount Issued

0

5

10

15

20

25

30

35

Amount Matured Amount Issued

Source: Bloomberg, NORD/LB Fixed Income Research Source: Bloomberg, NORD/LB Fixed Income Research

New issues The sectors Communications (around EUR 6.59bn) as well as Consumer,

cyclical (EUR 6.45bn) and Financial (EUR 6.40bn) accounted for more than

half of the issuance volume in January. The company with the highest

funding “requirement” was Deutsche Telekom, which raised a total of EUR

3.5bn divided across three tranches. At the same time, automotive

companies were very active. BMW placed two bond issues, raising EUR

2bn, while Daimler issued a EUR-denominated floating rate note totalling

EUR 0.2bn (and a further 0.45bn worth in GBP). Honda (EUR 0.5bn),

Volkswagen subsidiary Scania (EUR 0.5bn) and Jaguar (EUR 0.65bn) also

successfully raised money directly at the start of the year.



Fresenius bonds are very

popular

After a successful bond issue worth EUR 2.6bn (bid-to-cover ratio of more

than 4.5), Fresenius soon after successfully placed an equity neutral

convertible bond issue worth EUR 500m (maturity: 2024). The bonds carry

no interest and were issued at an issue price of 101.00%. The initial

conversion price was set with a 45% premium above the reference price of

the company’s shares. Following the successful borrower’s note issued in

12/2016 and the bond issue, the healthcare provider from Bad Homburg in

Germany has already financed its acquisition of hospital group Quirónsalud

in full.

An overview of selected new issues

ISIN Ticker CPN Maturity AMT

ISSUED ISSUE_DT

Rating Issue

spread (ms)

Issue spread

(benchmark)

Current spread (ASW)

Moody’s

S&P Fitch

XS1548436473 BMW 0.75 12.07.2024 750 12.01.2017 A1 A+ A+e 42 93 32

DE000A19BM44 DAIGR 0.326 12.01.2019 200 12.01.2017 A3 A A-e 28

XS1548436556 BMW 0.125 12.01.2021 1250 12.01.2017 A1 A+ A+e 20 84 13

XS1548387593 BASGR 1.45 13.12.2032 300 13.01.2017 A1 A+u 36

XS1550149204 ENELIM 1 16.09.2024 1250 16.01.2017 Baa2 BBB BBB+ 118 75

XS1550951211 TELEFO 1.528 17.01.2025 1250 17.01.2017 Baa3 BBB BBB 105 157 100


XS1551068676 ENIIM 1.5 17.01.2027 750 17.01.2017 Baa1 BBB+ 88 130 84

XS1549372420 HEIGR 0.5 18.01.2021 750 18.01.2017 Baa3 BBB- BBB- 55 115 39

FR0013231099 DGFP 1.25 18.01.2027 1000 18.01.2017 A3 A- 106 48

XS1518704900 LINGR 0.25 18.01.2022 1000 18.01.2017 A2 A+ 22 75 8

XS1551678409 TITIM 2.5 19.07.2023 1000 19.01.2017 Ba1 BB+ BBB- 237 290 218

DE000A19B8D4 ANNGR 0.75 25.01.2022 500 25.01.2017 BBB+ 122 54

DE000A19B8E2 ANNGR 1.75 25.01.2027 500 25.01.2017 BBB+ 156 95

As at: 6 February 2016, 18:00. Source: Bloomberg, NORD/LB Fixed Income Research

Mainly issuers from the

eurozone

In the previous years, an increase in bond issues by companies from abroad

(share of U.S. issuers of more than 20% in 2015 and 2016) was observed.

However, U.S. corporates accounted for only around 5% in January this

year. Reasons for this may include the hope of U.S. companies that tax

changes in the domestic market will be linked to the implementation of new

U.S. President Donald Trump’s tax reforms.

Maturities with the highest volume in February 2017

Company Ticker CPN Maturity AMT

ISSUED

Siemens AG SIEGR 5.125 20.02.2017 2000

Orange SA ORAFP 4.75 21.02.2017 1900

Telefonica SA TELEFO 4.75 07.02.2017 1420

thyssenkrupp AG TKAGR 4.375 28.02.2017 1250

Vinci SA DGFP 4.125 20.02.2017 1000

Repsol SA REPSM 4.75 16.02.2017 886

As at 6 February 2016, 18:00. Source: Bloomberg, NORD/LB Fixed Income Research

Outlook for February 2017 For February this year, we expect a lower issuance volume in comparison to

January 2017, which is partly connected with the lower volume of bonds

maturing. In addition, we know that Telefónica already successfully

refinanced its bonds maturing in February in the primary market (EUR

1.75bn).



Focus topic Impact of Trump’s election on corporates

Planned tax reforms to favour

U.S. companies

The tax system in the United States is based on income which is generated

in the USA (production-based). In the past, many large corporates

(particularly technology companies) benefited from this by transferring

intangible assets to low tax countries in order to avoid this taxation. The tax

reform, which the new administration aims to achieve, centres on

implementing a destination-based cash flow tax with border adjustment in

future. This would mean that cash flow is taxed depending on where sales

take place and as a result, export revenue would be exempt from taxation in

the USA. On the other hand, it would no longer be possible to offset imports

from suppliers for tax purposes, although sales of products within the USA

would be liable for tax.

Global trend in company taxation

15,00

20,00

25,00

30,00

35,00

40,00

45,00

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

tax rate

in %

Germany Italy Japan Global average

OECD average EU average Canada United Kingdom

United States France

As at 6 February 2017 – 11:00 (CET). Source: KPMG, NORD/LB Fixed Income Research

U.S. tax rates in a global

comparison

The United States tax rate for corporates of 40% is one of the highest

worldwide. The EU average currently is around 22% whereas the tax rate in

the USA has remained unchanged for 10 years (40%). The global average of

approximately 24% is at the lower end of the range. Only the United

Kingdom applies even lower taxation for corporates at 20%.



Impact on corporate bonds As part of the corporate tax reform, the lower future taxation for companies

would release new funds for investments. In combination with the

repatriation of cash reserves currently parked abroad, it would result in a

sharp downward trend in debt capital required, as the cash reserves

temporarily deposited are considerable. The proposed non-deduction of

interest costs from the tax basis additionally reduces the incentive to use

borrowed funds for financing purposes. It is worth considering how corporate

bonds would fare in such an environment. Specifically in view of the

decrease in new bond issues that is to be anticipated, U.S. corporates

should remain attractive in relative terms based on the achievable yield pick-

up in an environment where yields on US government bonds are rising. The

reason for this is that they provide a yield advantage compared with their

risk-free counterpart, US Treasuries, when supply diminishes.

Which companies and

sectors benefit from Trump’s

policy?

Despite Twitter politics and the almost daily new “alternative facts” from the

White House, it can be assumed that the measures announced

(deregulation, infrastructure programme and corporate tax reform) will have

a positive impact on the following U.S. sectors and U.S. companies:

1. Sectors with a high level of regulation at present (financial

industry, oil and gas industry as well as the pharmaceutical

industry)

2. Sectors with a high share of exports (oil and gas industry,

logistics and aviation)

3. Sectors that profit from an infrastructure programme

(construction and logistics)

4. Corporates that hold high cash reserves abroad (10% – tax

holiday as part of repatriation of cash reserves)

5. Corporates with high value added in the USA

Which companies and

sectors are negatively

impacted by Trump’s policy?

Companies which depend heavily on imports would suffer as a result of

Trump’s tax plans, because imported products would not be tax deductible in

the future. In addition, any potential sales revenue would be taxable in full in

the USA. This would affect corporates with international activities in their

supply chain and major retail chains. Theoretically, the calculation is as

follows: the disadvantage arising is compensated in a national economy by a

FX revaluation because the export advantages would result in an increase in

exports. The foreign trade deficit would decrease and importing corporates

would be able to use the hard currency of their home market to buy offshore.

A “pleasant secondary effect” from the point of view of the U.S.

administration, is, for example, the fact that German corporates which

depend heavily on exports to the USA (mechanical engineering, chemicals,

pharma and automotive as well as their suppliers) would be affected by this,

since the new tax system would trigger clear competitive disadvantages.



ECB tracker Monthly analysis of the CSPP

CSPP data published As usual, the ECB yesterday (06 February) published information about the

bonds purchased by the six national central banks under the CSPP.

Ultimately, 14 new ISINs were determined for the previous week, meaning

that the number of bonds purchased rose to 828. In the previous week, the

bonds purchased included bonds from issuers Vonovia, Engie and Snam,

which are already firmly anchored in the CSPP. In total, the volume

purchased came to around EUR 61.0bn and was spread across 211 different

issuers. Assuming that national central banks maintain their current

purchase tempo, the extrapolated total volume will amount to EUR 146.1bn

by December 2017. Last week, for the first time, a bond issue in the CSPP

matured. The Telekom Austria bonds purchased by the Finnish central bank

(Suomen Pankki) matured on 27 January 2017. The amount of the bonds

issued which the central bank had bought was less than EUR 50m, which is

lower than the statistical (CSPP total volume/number of ISINs purchased)

average figure of EUR 73.6m.

Central banks very busy A high level of primary market activities and a backlog of demand after the

central banks had significantly reduced their purchasing activities in the

context of the “Christmas break” ensured energetic buying by the NCBs in

January this year. In each of the first few weeks of the year, a volume that

exceeded the previous weekly average figures was purchased. This resulted

in an increase of the weekly average to a current approximately EUR 1.7bn.

With a volume purchased of almost EUR 2.9bn, the third calendar week was

the week with the highest purchases since the start of the CSPP in June

2016.

Number of purchases in the

primary market slightly up

As forecast, the number of bonds directly purchased in the primary market

by central banks during January 2017 also increased. Approximately 14.1%

(+0.5%) of the volume bought by NCBs was immediately purchased upon

issue.

New ISINs included on the ECB purchase list for the CSPP

ISIN Issuer Remaining

term Outstanding volume [bn]

Yield remaining term

FR0011344076 AIR LIQUIDE FINANCE 4.7 0.50 0.175

FR0013230943 VALEO SA 5.9 0.50 0.692

XS0827999318 ORANGE SA 6.1 0.50 0.574

XS1134729794 NOVARTIS FINANCE SA 9.8 0.60 0.787

XS1550988569 NN GROUP NV 5.9 0.50 0.889

XS0458685913 HEIDELBERGCEMENT FIN LUX 2.7 0.50 0.089

XS1533928971 WPC EUROBOND BV 7.4 0.50 2.150


XS1548436556 BMW FINANCE NV 3.9 1.25 0.104

DE000A1TNJ97 DAIMLER AG 4.4 0.75 0.229

XS1548436473 BMW FINANCE NV 7.4 0.75 0.762

XS1396285279 EUROGRID GMBH 11.2 0.75 1.487

XS1550951211 TELEFONICA EMISIONES SAU 7.9 1.25 1.528

XS1551726810 CELLNEX TELECOM SA 8.2 0.34 2.955


XS1551446880 GAS NATURAL FENOSA FINAN 9.9 1.00 1.600

XS1529684695 GAS NETWORKS IRELAND 9.8 0.50 1.333



FR0013231099 AUTOROUTES DU SUD DE LA 9.9 1.00 1.238

XS0994991411 TOTAL CAPITAL INTL SA 8.8 0.65 0.856

XS1551678409 TELECOM ITALIA SPA 6.4 1.00 2.507

XS1551068676 ENI SPA 9.9 0.75 1.624

XS1017828911 BASF SE 2.0 0.75 -0.002

XS1518704900 LINDE FINANCE BV 4.9 1.00 0.183

XS1554456613 LEG IMMOBILIEN AG 7.0 0.50 1.199


XS1554373164 FRESENIUS FIN IRELAND PL 5.0 0.70 0.744




FR0011565555 RTE RESEAU DE TRANSPORT 6.6 0.50 0.609

FR0013073277 LEGRAND SA 10.9 0.30 1.137

FR0013142536 CARMILA 7.6 0.60 1.719

XS1550149204 ENEL FINANCE INTL NV 7.6 1.25 1.256

XS1551917245 ITALGAS SPA 5.0 0.75 0.607

XS1508588875 SNAM SPA 3.7 0.50 0.287

XS1558491855 ATLANTIA SPA 8.0 0.75 1.611


XS1119021357 EXOR NV 7.7 0.65 1.812

XS1329671132 EXOR NV 5.8 0.75 1.229

XS1558083652 EDP FINANCE BV 6.6 0.60 1.923

DE000A0Z2A12 EWE AG 4.4 0.46 0.301

DE000A19B8D4 VONOVIA FINANCE BV 5.0 0.50 0.636

DE000A19B8E2 VONOVIA FINANCE BV 10.0 0.50 1.710

XS1451452954 REPSOL INTL FINANCE 2.4 0.10 0.095

FR0010678185 ENGIE SA 2.0 0.83 -0.179

FR0011509488 AEROPORTS DE PARIS 11.3 0.60 1.193

FR0012967461 CARMILA 6.6 0.60 1.424

XS1218363270 UNIBAIL-RODAMCO SE 13.2 0.50 1.625

XS1555402145 SNAM SPA 8.0 0.50 1.332

XS1205716720 AUTOSTRADA BRESCIA V 3.1 0.60 0.796

Source: ECB, NORD/LB Fixed Income Research – bonds from the issuers listed in italics were purchased for the first time in the previous month

CSPP diagrams One diagram – four statements [EURm]

Source: ECB, Bloomberg, NORD/LB Fixed Income Research; lhs` means the outer left Y-axis and rhs´ the outer right Y-axis



Yield overview CSPP portfolio

-0,50

0,00

0,50

1,00

1,50

2,00

2,50

3,00

3,50

0 2 4 6 8 10 12 14 16 18 20

Yie

ld i

n %

Years to maturity

Basic Materials Communications Consumer, Cyclical Consumer, Non-cyclical Diversified Energy Financial Government Industrial Technology Utilities

Source: ECB, Bloomberg, NORD/LB Fixed Income Research

Yield overview CSPP portfolio (up to 10 years maturity)

-0,50

0,00

0,50

1,00

1,50

2,00

2,50

3,00

3,50

0 1 2 3 4 5 6 7 8 9 10

Yie

ld i

n %

Years to maturity

Basic Materials Communications Consumer, Cyclical Consumer, Non-cyclical Diversified Energy Financial Government Industrial Technology Utilities


Classification by outstanding volume Rating distribution according to the Bloomberg

Composite

0

50

100

150

200

250

300

350

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

<250mn 250 to <500mn 500 to < 1bn >= 1bn

Amount Outstanding in EUR Distribution number weighted (rhs)

4% 4%

9%

6%

19%

24%

18%

12%

4%

AA

AA-

A+

A

A-

BBB+

BBB

BBB-

BB+

Source: ECB, Bloomberg, NORD/LB Fixed Income Research Source: ECB, Bloomberg, NORD/LB Fixed Income Research



Distribution by central bank Distribution by central bank and sector

0

50

100

150

200

250

# p

urc

ha

sed

Bo

nd

s

0

50

100

150

200

250

# p

urc

ha

sed

Bo

nd

s

Diversified

Technology

Government

Basic Materials

Industrial

Energy

Financial

Consumer, Cyclical

Communications

Consumer, Non-cyclical


Top 15 purchased companies Distribution by sector and central bank

0

2

4

6

8

10

12

14

16

18

20

# p

urc

ha

sed

Bo

nd

s

0

10

20

30

40

50

60

# p

urc

ha

sed

Bo

nd

s

DeutscheBundesbank

Banque deFrance

NB van Belgie

Banca d'Italia

Banco deEspana

SuomenPankki


Distribution of ISINs purchased within the framework of the CSPP

Country Number of

bonds %

distribution Outstanding

volume %

distribution

Average remaining

term in years

Average remaining term of all

bonds

Difference in years

Germany 201 24.2% 146.3 25.1% 5.0 5.8 -0.8

France 216 26.1% 161.1 27.6% 6.3 5.8 0.5

Netherlands 71 8.6% 46.1 7.9% 6.5 5.8 0.8

Italy 91 11.0% 69.8 12.0% 5.6 5.8 -0.2

Spain 89 10.7% 63.3 10.8% 5.7 5.8 -0.1

Belgium 33 4.0% 26.8 4.6% 7.9 5.8 2.1

Austria 22 2.7% 10.4 1.8% 4.8 5.8 -1.0

Finland 15 1.8% 6.6 1.1% 4.9 5.8 -0.9

Other 91 11.0% 53.3 9.1% 5.7 5.8 -0.1

Total/

average 828 100.0% 583.7 100.0% 5.8 5.8 5.8




CDS performance Recovery at year-end

Phase of tightening

continues after Trump break

In the first week of the new year, spread levels in the iTraxx Europe

tightened as far as 67bp, before widening to up to 74bp following the high

volume of new issues in the course of January. Similar to the iTraxx Europe,

the iTraxx Crossover widened from 280bp on 3rd January to up to 302bp by

1st February. In view of the lower issuing volume anticipated for February,

we expect a minor sideways tightening trend. Cash bonds are less sensitive

to current developments than their synthetic counterparts. Further executive

orders signed by new U.S. President Trump may also impact on the

“performance”. In contrast, the current reporting season is not expected to

cause more than partial effects at most.

Movement in spreads: iTraxx Europe vs iTraxx Xover

0

50

100

150

200

250

300

350

400

450

500

0

50

100

150

200

250

bp

bp

iTraxx Europe (lhs) iTraxx Xover (rhs) iBoxx € IG Corporates (lhs) iBoxx € High Yield (rhs)

ECB-Session Brexit- Referendum US-Election 10.03.2016 23.06.2016 08.11.2016

As at 6 February 2017 – 11:00 (CET). Source: Bloomberg, NORD/LB Fixed Income Research



Rating changes For the period 1 January 2017 – 31 January 2017

Date Country

Company Agency Type of rating Old rating New rating

31.01.17 US American International Group Inc S&P LT Local Issuer Credit A- BBB+

31.01.17 US American International Group Inc S&P LT Foreign Issuer Credit A- BBB+

31.01.17 US American International Group Inc S&P Outlook STABLE

31.01.17 CW Teva Pharmaceutical Finance IV BV Moody’s Outlook NEG

31.01.17 NL Teva Pharmaceutical Finance Netherlands II BV Moody’s Outlook NEG

30.01.17 US General Motors Financial Co Inc Moody’s Outlook STABLE

30.01.17 US General Motors Financial Co Inc Moody’s LT Corp Family Rating Ba1 Baa3

30.01.17 US General Motors Financial Co Inc Moody’s Senior Unsecured Debt Ba1 Baa3

30.01.17 US General Motors Financial Co Inc Moody’s Long Term Rating Baa3

30.01.17 NL General Motors Financial International BV Moody’s Outlook STABLE

30.01.17 NL General Motors Financial International BV Moody’s Senior Unsecured Debt (P)Ba1 (P)Baa3

30.01.17 NL General Motors Financial International BV Moody’s Long Term Rating Baa3

27.01.17 GB British Telecommunications PLC S&P Outlook NEG

27.01.17 GB EE Finance PLC S&P Outlook NEG

26.01.17 US American International Group Inc AMBest Long Term Issuer Credit bbb bbb *-

26.01.17 GB British Telecommunications PLC Moody’s Outlook NEG

26.01.17 GB EE Finance PLC Moody’s Outlook NEG

25.01.17 BM Bacardi Ltd S&P Outlook STABLE

25.01.17 NL BMW Finance NV Moody’s Long Term Rating A1

25.01.17 NL BMW Finance NV Moody’s Senior Unsecured Debt A2 A1

25.01.17 NL BMW Finance NV Moody’s Outlook STABLE

25.01.17 US BMW US Capital LLC Moody’s Senior Unsecured Debt A2 A1

25.01.17 US BMW US Capital LLC Moody’s Long Term Rating A1

25.01.17 US BMW US Capital LLC Moody’s Outlook STABLE

24.01.17 US American International Group Inc Fitch LT Issuer Default Rating A- A- *-

24.01.17 US American International Group Inc Fitch Subordinated Debt NR NR

24.01.17 US American International Group Inc Fitch Senior Unsecured Debt BBB+ BBB+ *-

24.01.17 US American International Group Inc Fitch JR Subordinated Debt BBB- BBB- *-

24.01.17 DE BASF SE Creditref Outlook STABLE

24.01.17 DE BASF SE Creditref LT Issuer Rating A+u

23.01.17 US American Honda Finance Corp S&P Outlook NEG

23.01.17 US Prologis LP Fitch LT Issuer Default Rating BBB BBB+

23.01.17 US Prologis LP Fitch Outlook STABLE

23.01.17 US Prologis LP Fitch Senior Unsecured Debt BBB BBB+

23.01.17 GB Rolls-Royce PLC S&P Outlook STABLE

23.01.17 GB Rolls-Royce PLC S&P LT Foreign Issuer Credit A- BBB+

23.01.17 GB Rolls-Royce PLC S&P LT Local Issuer Credit A- BBB+

20.01.17 GB Pearson Funding Five PLC Moody’s Outlook NEG

19.01.17 BE Eandis System Operator SCRL Creditref. Outlook STABLE

19.01.17 BE Eandis System Operator SCRL Creditref LT Issuer Rating A+

18.01.17 IT Luxottica Group SpA S&P ST Local Issuer Credit A-2 A-2 *+



18.01.17 IT Luxottica Group SpA S&P LT Foreign Issuer Credit A- A- *+

18.01.17 IT Luxottica Group SpA S&P LT Local Issuer Credit A- A- *+

18.01.17 IT Luxottica Group SpA S&P ST Foreign Issuer Credit A-2 A-2 *+

18.01.17 CA Magna International Inc Moody’s Long Term Rating A3

18.01.17 CA Magna International Inc Moody’s Outlook STABLE

18.01.17 CA Magna International Inc Moody’s Issuer Rating Baa1 A3

18.01.17 CA Magna International Inc Moody’s Senior Unsecured Debt Baa1 A3

17.01.17 GB BAT International Finance PLC Moody’s Issuer Rating A3 *- Baa2

17.01.17 GB BAT International Finance PLC Moody’s Short Term P-2 *- P-2

17.01.17 GB BAT International Finance PLC Moody’s Senior Unsecured Debt A3 *- Baa2

17.01.17 GB BAT International Finance PLC Moody’s Outlook STABLE

17.01.17 GB BAT International Finance PLC Moody’s Long Term Rating Baa2

16.01.17 FR Essilor International SA Moody’s Outlook POS

16.01.17 DE LEG Immobilien AG Moody’s Senior Unsecured Debt Baa1

13.01.17 US Flowserve Corp S&P Outlook NEG

12.01.17 DE HeidelbergCement AG EJR FC Commercial Paper A2 A1

12.01.17 DE HeidelbergCement AG EJR LC Commercial Paper A2 A1

12.01.17 NL WPC Eurobond BV Moody’s Long Term Rating Baa2

11.01.17 US Mohawk Industries Inc Moody’s Outlook STABLE

11.01.17 US Mohawk Industries Inc Moody’s Long Term Rating Baa1

11.01.17 US Mohawk Industries Inc Moody’s Senior Unsecured Debt Baa2 Baa1

10.01.17 US General Motors Financial Co Inc S&P LT Foreign Issuer Credit BBB- BBB

10.01.17 US General Motors Financial Co Inc S&P Outlook STABLE

10.01.17 US General Motors Financial Co Inc S&P LT Local Issuer Credit BBB- BBB

10.01.17 US Southern Power Co S&P Outlook STABLE

09.01.17 FR Engie SA Creditref LT Issuer Rating A-u

09.01.17 FR Engie SA Creditref Outlook STABLE

06.01.17 LU Novartis Finance SA Moody’s Short Term P-1 WR



New issues In the period 1 January 2017 – 31 January 2017

ISIN TICKER CPN MATURITY AMT_ISSUED ISSUE_DT Rating Issue spread Issue spread Current spread

Moody’s S&P Fitch (ms) (to benchmark) (ASW)

FR0013230943 FRFP 0.625 11.01.2023 500 11.01.2017 Baa2 BBB 48 106 44

FR0013230737 RENAUL 0.75 12.01.2022 750 12.01.2017 Baa1 BBB 70 126 67

XS1548436473 BMW 0.75 12.07.2024 750 12.01.2017 A1 A+ A+e 42 93 32

XS1548776498 F 0.869 13.09.2021 750 12.01.2017 Baa2 BBB BBB 136 71

DE000A19BM44 DAIGR 0.326 12.01.2019 200 12.01.2017 A3 A A-e 28

XS1548436556 BMW 0.125 12.01.2021 1250 12.01.2017 A1 A+ A+e 20 84 13

XS1548387593 BASGR 1.45 13.12.2032 300 13.01.2017 A1 A+u 36

XS1550149204 ENELIM 1 16.09.2024 1250 16.01.2017 Baa2 BBB BBB+ 118 75

XS1551347393 TTMTIN 2.2 15.01.2024 650 17.01.2017 Ba1 BB+ 188 236 169

XS1551933010 PRYIM 0 17.01.2022 500 17.01.2017 98

XS1551347807 TTMTIN 2.2 15.01.2024 650 17.01.2017 Ba1 BB+ 188 235 171


FR0013231768 NK 1.5 15.01.2027 600 17.01.2017 Baa2 BBB 92 134 89

XS1550134602 HNDA 0.75 17.01.2024 500 17.01.2017 A1 A+ 42 89 35


XS1551068676 ENIIM 1.5 17.01.2027 750 17.01.2017 Baa1 BBB+ 88 130 84

XS1549372420 HEIGR 0.5 18.01.2021 750 18.01.2017 Baa3 BBB- BBB- 55 115 39

FR0013231099 DGFP 1.25 18.01.2027 1000 18.01.2017 A3 A- 106 48

XS1551726810 CLNXSM 2.875 18.04.2025 335 18.01.2017 BB+ BBB- 255 303 233

XS1518704900 LINGR 0.25 18.01.2022 1000 18.01.2017 A2 A+ 22 75 8

XS1551678409 TITIM 2.5 19.07.2023 1000 19.01.2017 Ba1 BB+ BBB- 237 290 218

XS1551917245 IGIM 0.5 19.01.2022 750 19.01.2017 Baa1 BBB+ 60 113 47

XS1551446880 GASSM 1.375 19.01.2027 1000 19.01.2017 Baa2 BBB BBB+ 127 81

XS1551917591 IGIM 1.625 19.01.2027 750 19.01.2017 Baa1 BBB+ 105 148 95

XS1554456613 LEGGR 1.25 23.01.2024 500 23.01.2017 Baa1 102 151 84

XS1554462421 SCANIA 0.022 24.10.2018 500 24.01.2017 BBB+ 24

XS1555147799 SKGID 2.375 01.02.2024 500 24.01.2017 Ba1 BB+ BB+ 257 184

XS1555147369 SKGID 2.375 01.02.2024 500 24.01.2017 Ba1 BB+ BB+ 257 184

XS1551932046 IIAAV 2 24.01.2024 300 24.01.2017 387

FR0013233426 BOLFP 2 25.01.2022 500 25.01.2017 195 249 182

FR0013233384 ACFP 1.25 25.01.2024 600 25.01.2017 BBB- BBB- 103 153 94

DE000A19B8D4 ANNGR 0.75 25.01.2022 500 25.01.2017 BBB+ 122 54

DE000A19B8E2 ANNGR 1.75 25.01.2027 500 25.01.2017 BBB+ #N/A N/A 156 95

AT0000A1REV0 ERSTPS 3.04 25.01.2022 200 25.01.2017

XS1555402145 SRGIM 1.25 25.01.2025 500 25.01.2017 Baa1 BBB BBB+ 85 138 78

XS1558013360 IMBLN 1.375 27.01.2025 500 27.01.2017 Baa3 BBB 144 82

XS1558013014 IMBLN 0.5 27.07.2021 500 27.01.2017 Baa3 BBB 113 41



XS1554373248 FREGR 1.5 30.01.2024 700 30.01.2017 Baa3 BB+ BBB-e 120 169 101

XS1557095616 DT 1.375 30.01.2027 1250 30.01.2017 Baa1 BBB+ BBB+e 117 61

XS1557096267 DT 0.875 30.01.2024 1250 30.01.2017 Baa1 BBB+ BBB+e 102 45

XS1557095459 DT 0.375 30.10.2021 1000 30.01.2017 Baa1 BBB+ BBB+e 87 19



XS1554373834 FREGR 3 30.01.2032 500 30.01.2017 Baa3 BB+ BBB-e 254 177

XS1558083652 EDPPL 1.875 29.09.2023 600 30.01.2017 Baa3 BB+ BBB- 158 211 149

DE000A2DAHU1 FREGR 0 31.01.2024 500 31.01.2017 Baa3 BB+ 31



Annex Charts & diagrams

Comparison of historical ASW spreads (10Y)

Min./max. comparison of current spread levels (10Y)

0

50

100

150

200

250

AS

W in

bp

Basic Materials CommunicationsConsumer, Cyclical Consumer, Non-cyclicalDiversified EnergyFinancial IndustrialTechnology Utilities

0,00

50,00

100,00

150,00

200,00

250,00

ac

t S

pre

ad

vs

Min

/Ma

x t

-24

M

MIN(24M) MAX (24M) ACT

Source: Markit, Bloomberg, NORD/LB Fixed Income Research Source: Markit, Bloomberg, NORD/LB Fixed Income Research



0

50

100

150

200

250

AS

W in

bp


0,00

50,00

100,00

150,00

200,00

250,00

ac

t S

pre

ad

vs

Min

/Ma

x t

-24

M





0

50

100

150

200

250

300

350

AS

W in

bp


0,00

50,00

100,00

150,00

200,00

250,00

300,00

350,00

ac

t S

pre

ad

vs

Min

/Ma

x t

-24

M





Annex Charts & diagrams

iBoxx € Corporates – comparison of issues iBoxx € Corporates – classification

0

50

100

150

200

250

300

350

1Y-3Y 3Y-5Y 5Y-7Y 7Y-10Y >10Y

2015

2016

2017

Financials

Basic Materials

Consumer Goods

Consumer Services

Health Care

Industrials

Oil & Gas

Technology

Telecommunications

Utilities


iBoxx € Corporates – distribution country of risk iBoxx € Corporates – maturities per month

0,0%

5,0%

10,0%

15,0%

20,0%

25,0%

DE GB NL ES US FR CH IT SE Other

0

5

10

15

20

25

30

35

1 2 3 4 5 6 7 8 9 10 11 12

2017

2018

2019

2020

2021


iBoxx € Corporate – rating distribution iBoxx € Corporate – volume weighting (sector)

0,7% 0,3% 1,1%

7,5%

12,0%

13,4%

18,9%

20,0%

15,9%

9,1%

1,2%

AAA

AA+

AA

AA-

A+

A

A-

BBB+

BBB

BBB-

BB+

0

100

200

300

400

500

600

700




iTraxx Europe – best performer (Δ 1M) iTraxx Europe – worst performer (Δ 1M)

-41

-24

-20

-12

-12

-12

-12

-11

-9

-8

-50 -40 -30 -20 -10 0

Safeway Ltd

Standard Chartered Bank

Banco Santander SA

Royal Bank of Scotland PLC/The

Danske Bank A/S

Volkswagen AG

Glencore International AG

Aegon NV

Telefonica SA

Mediobanca SpA

5

6

6

7

7

8

10

12

14

36

0 5 10 15 20 25 30 35 40

Koninklijke Ahold Delhaize NV

Veolia Environnement SA

Electricite de France SA

LafargeHolcim Ltd

Atlantia SpA

Engie SA

British Telecommunications PLC

Orange SA

Next PLC

Pearson PLC


iTraxx Xover – best performer (Δ 1M) iTraxx Xover – worst performer (Δ 1M)

-223

-144

-129

-122

-75

-51

-42

-39

-38

-30

-250 -200 -150 -100 -50 0

Financiere Quick SAS (Sub)

CMA CGM SA

Galapagos Holding SA

Hema Bondco I BV

Care UK Health & Social Care PLC (Sub)

Novafives SAS

Stena AB

Jaguar Land Rover Automotive PLC

Anglo American PLC

Casino Guichard Perrachon SA

26

30

35

35

41

74

98

135

135

256

0 50 100 150 200 250 300

Ladbrokes Coral Group PLC

Hellenic Telecommunications…

Garfunkelux Holdco 2 SA

Unilabs Subholding AB

Pizzaexpress Financing 1 PLC

Loxam SAS (Sub)

Premier Foods Finance PLC

Selecta Group BV

Astaldi SpA

New Look Senior Issuer PLC




Appendix Contacts

Fixed Income Research

Michael Schulz Head +49 511 361-5309 [email protected]

Kai Ebeling Covered Bonds +49 511 361-9713 [email protected]

Mario Gruppe Public Issuers +49 511 361-9787 [email protected]

Michaela Hessmert Banks +49 511 361-6915 [email protected]

Melanie Kiene Banks +49 511 361-4108 [email protected]

Jörg Kuypers Corporates / Retail Products +49 511 361-9552 [email protected]

Matthias Melms Covered Bonds +49 511 361-5427 [email protected]

Sascha Remus Corporates / Retail Products +49 511 361-2722 [email protected]

Norman Rudschuck Public Issuers +49 511 361-6627 [email protected]

Thomas Scholz Corporates / Retail Products +49 511 361-4710 [email protected]

Martin Strohmeier Corporates / Retail Products +49 511 361-4712 [email protected]

Kai Witt Corporates / Retail Products +49 511 361-4639 [email protected]

Markets Sales

Carsten Demmler Head +49 511 361-5587 [email protected]

Institutional Sales (+49 511 9818-9440)

Thorsten Bock [email protected] Gabriele Schneider [email protected]

Uwe Kollster [email protected] Dirk Scholden [email protected]

Rainer Nabel [email protected] Uwe Tacke [email protected]

Daniel Novotny-Farkas [email protected]

Sales Savings Banks / Regional Banks (+49 511 9818-9400)

Christian Schneider (Head) [email protected] Martin Koch [email protected]

Thorsten Aberle [email protected] Stefan Krilcic [email protected]

Oliver Bickel [email protected] Bernd Lehmann [email protected]

Tobias Bohr [email protected] Jörn Meißner [email protected]

Kai-Ulrich Dörries [email protected] Lutz Schimanski [email protected]

Jan Dröge [email protected] Ralf Schirrling [email protected]

Sascha Goetz [email protected] Brian Zander [email protected]

Sales Asia (+65 64 203136)

Jefferson Ko [email protected] Muhammad Peter Shepherd

[email protected]

Fixed Income / Structured Products Sales Europe (+352 452211-515)

René Rindert (Head) [email protected] Toni Martikainen [email protected]

Morgan Kermel [email protected] Laurence Payet [email protected]

Patricia Lamas [email protected]

Corporate Sales

Shipping / Aircraft +49 511 9818-8150 Corporate Clients +49 511 9818-4003

Real Estate / Structured Finance

+49 511 9818-8150 FX/MM

+49 511 9818-4006

Corporate Finance – Origination Corporates

Tobias Müssig (Leitung) [email protected] Sandro Pittalis [email protected]

Roland Arndt [email protected] Stefan Sigrist [email protected]

Sebastian Dahlhaus [email protected] Sabine Stenschke [email protected]

Birgit Determann [email protected] Karsten Wernecke [email protected]

Christian Müller [email protected]

Financial Markets Trading

Corporates +49 511 9818-9690 Collat. Mgmt / Repos +49 511 9818-9200

Covereds / SSAs +49 511 9818-8040 Cust. Exec. & Trading +49 511 9818-9480

Financials +49 511 9818-9490 Frequent Issuers +49 511 9818-9640

Governments +49 511 9818-9660 Structured Products +49 511 9818-9670

Länder & Regions +49 511 9818-9550

mailto:[email protected]








Disclaimer

This investment recommendation/investment strategy recommendation (hereinafter the „Investment Recommendation”) was drawn up

by NORDDEUTSCHE LANDESBANK GIROZENTRALE („NORD/LB“). The supervisory authorities in charge of NORD/LB are the

European Central Bank („ECB“), Sonnemannstraße 20, D-60314 Frankfurt am Main, and the Federal Financial Supervisory Authority

(Bundesanstalt für Finanzdienstleitungsaufsicht - „BaFin“), Graurheindorfer Str. 108, D-53117 Bonn, and Marie-Curie-Str. 24-28, D-

60439 Frankfurt am Main. Details about the extent of NORD/LB´s regulation by the respective authorities are available on request.

Generally, this Investment Recommendation or the products or services described therein have not been reviewed or approved by the

competent supervisory authority.

This Investment Recommendation is addressed exclusively to recipients which are professional and institutional clients in Germany, the

United Kingdom, Austria, Belgium, Italy, Spain, Denmark, Finland, Estonia, France, Greece, Ireland, Luxembourg, the Netherlands,

Poland, Portugal, Sweden, the Czech Republic, Canada, Switzerland and Cyprus (hereinafter the „Relevant Persons” or „Recipients”).

The contents of this Investment Recommendation are disclosed to the Recipients on a strictly confidential basis and, by accepting this

Investment Recommendation, the Recipients agree that they will not forward to third parties, copy and/or reproduce this Investment

Recommendation without NORD/LB’s prior written consent. The figures discussed in this Investment Recommendation are only

addressed to the Relevant Persons and any persons other than the Relevant Persons must not rely on this Investment

Recommendation. In particular, neither this Investment Recommendation nor any copy thereof must be forwarded or transmitted to the

United States of America or its territories or possessions or distributed to any employees or affiliates of Recipients resident in these

jurisdictions.

This Investment Recommendation was drawn up in compliance with the applicable provisions of the German Securities Trading Act

(Wertpapierhandelsgesetz) and the Regulation Governing the Analysis of Financial Instruments (Verordnung über die Analyse von

Finanzinstrumenten). In organizational, hierarchical, functional and local terms, the Research Division of NORD/LB is independent of any

divisions responsible for the issuance of securities and investment banking activities, for trading (including proprietary trading) in and

sales of securities as well as for lending activities.

This Investment Recommendation and the information contained herein have been compiled and are provided exclusively for information

purposes. This Investment Recommendation is not intended as an investment incentive. It is provided for the Recipient’s personal

information, subject to the express understanding, which is acknowledged by the Recipient, that it does not constitute any direct or

indirect offer, individual recommendation, solicitation to purchase, hold or sell or to subscribe for or acquire any securities or other

financial instruments nor any measure by which financial instruments might be offered or sold.

All actual details, information and statements contained herein were derived from sources considered reliable by NORD/LB. However,

since these sources are not verified independently, NORD/LB cannot give any assurance as to or assume responsibility for the accuracy

and completeness of the information contained herein. The opinions and prognoses given herein on the basis of these sources

constitute a non-binding evaluation by the analysts of NORD/LB. Any changes in the underlying premises may have a material impact on

the developments described herein. Neither NORD/LB nor its governing bodies or employees can give any assurance as to or assume

any responsibility or liability for the accuracy, adequacy and completeness of this Investment Recommendation or any loss of return, any

indirect, consequential or other damage which may be suffered by persons relying on the information or any statements or opinions set

forth in this Investment Recommendation (irrespective of whether such losses are incurred due to any negligence on the part of these

persons or otherwise).

Past performances are not a reliable indicator of future performances. Exchange rates, price fluctuations of the financial instruments and

similar factors may have a negative impact on the value and price of and return on the financial instruments referred to herein or any

instruments linked thereto. An evaluation made on the basis of the historical performance of any security does not necessarily give an

indication of its future performance.

This Investment Recommendation neither constitutes any investment, legal, accounting or tax advice nor any representation that an

investment or strategy is suitable or appropriate in the light a Recipient’s individual circumstances, and nothing in this Investment

Recommendation constitutes a personal recommendation to the Recipient thereof. The securities or other financial instruments referred

to herein may not be suitable for the Recipient’s personal investment strategies and objectives, financial situation or individual needs.

Also this Investment Recommendation as a whole or any part thereof is not a sales or other prospectus. Correspondingly, the

information contained herein merely constitutes an overview and does not form the basis for an investor‘s potential decision to buy or

sell. A full description of the details relating to the financial instruments or transactions which may relate to the subject matter of this

Investment Recommendation is set forth in the relevant (financing) documentation. To the extent that the financial instruments described

herein are NORD/LB’s own issues and subject to the requirement to publish a prospectus, the conditions of issue applicable to any

individual financial instrument and the relevant prospectus published with respect thereto as well NORD/LB’s relevant registration form,

all of which are available for downloading at www.nordlb.de and may be obtained, free of charge, from NORD/LB, Georgsplatz 1, 30159

Hanover, shall be solely binding. Any potential investment decision should at any rate be made exclusively on the basis of such

(financing) documentation. This Investment Recommendation cannot replace personal advice. Before making an investment decision,

each Recipient should consult an independent investment adviser for individual investment advice with respect to the appropriateness of

an investment in financial instruments or investment strategies as contemplated herein as well as for other and more recent information

on certain investment opportunities.

Each of the financial instruments referred to herein may involve substantial risks, including capital, interest, index, currency and credit

risks, political, fair value, commodity and market risks. The financial instruments could experience a sudden substantial deterioration in

value, including a total loss of the capital invested. Each transaction should only be entered into on the basis of the relevant investor’s

assessment of its individual financial situation as well as of the suitability and risks of the investment.

NORD/LB and its affiliates may, for their own account or for the account of third parties, participate in transactions involving the financial

instruments described herein or any underlying assets, issue further financial instruments having terms that are the same as or similar to

those governing the financial instruments referred to herein as well as enter into transactions to hedge positions. Such actions may affect

the price of the financial instruments described in this Investment Recommendation.



To the extent the financial instruments referred to herein are derivatives, they may involve an initial negative market value from the

customer’s point of view, depending on the terms and conditions prevailing as of the transaction date. Furthermore, NORD/LB reserves

the right to pass on its economic risk from any derivative transaction it has entered into to third parties in the market by way of a mirror

image counter-transaction.

Further information on any fees which may be included in the sales price is set forth in the brochure „Customer Information Relating to

Securities Transactions“ which is available at www.nordlb.de.The information set forth in this Investment Recommendation shall

supersede all previous versions of any relevant Investment Recommendation and refer exclusively to the date as of which this

Investment Recommendation has been drawn up. Any future versions of this Investment Recommendation shall supersede this present

version. NORD/LB shall not be under any obligation to update and/or review this Investment Recommendation at regular intervals.

Therefore, no assurance can be given as to its currentness and continued accuracy.

By making use of this Investment Recommendation, the Recipient shall accept the foregoing terms and conditions.

NORD/LB is a member of the protection scheme of Deutsche Sparkassen-Finanzgruppe. Further information for the Recipient is set

forth in clause 28 of the General Terms and Conditions of NORD/LB or at www.dsgv.de/sicherungssystem.

Additional information for recipients in the UK

NORD/LB subject to limited regulation by the Financial Conduct Authority (“FCA”) und Prudential Regulation Authority (“PRA”). Details

about the extent of our regulation by the FCA and PRA are available from NORD/LB on request.

This Investment Recommendation is a financial promotion. Relevant Persons in the UK should contact NORD/LB’s London Branch,

Investment Banking Department, Telephone: 0044 / 2079725400 with any queries.

Investing in financial instruments referred to in this Investment Recommendation may expose an investor to a significant risk of losing all

of the amount invested.

Additional information for recipients in France

NORD/LB is partially regulated by the Autorité des Marchés Financiers for the conduct of French business. Details about the extent of

our regulation by the respective authorities are available from us on request.

This Investment Recommendation constitutes investment research within the meaning of Article 24(1) Directive 2006/73/EC, Article

L.544-1 and R.621-30-1 of the French Monetary and Financial Code and does qualify as research recommendation under Directive

2003/6/EC and Directive 2003/125/EC.

Additional information for recipients in Austria

None of the information contained in this Investment Recommendation constitutes a solicitation or offer by NORD/LB or its affiliates to

buy or sell any securities, futures, options or other financial instruments or to participate in any other strategy. Only the published

prospectus pursuant to the Austrian Capital Market Act should be the basis for any investment decision of the Recipient.

For regulatory reasons, products mentioned in this Investment Recommendation may not being offered into Austria and are not available

to investors in Austria. Therefore, NORD/LB might not be able to sell or issue these products, nor shall it accept any request to sell or

issues these products, to investors located in Austria or to intermediaries acting on behalf of any such investors.

Additional information for recipients in Belgium

Evaluations of individual financial instruments on the basis of past performance are not necessarily indicative of future results. It should

be noted that the reported figures relate to past years.

Additional information for recipients in Cyprus

This Investment Recommendation constitutes investment research within the meaning of the definition section of the Cyprus Directive

D1444-2007-01(No 426/07). Furthermore, this material is provided for informational and advertising purposes only and does not

constitute an invitation or offer to sell or buy or subscribe any investment product.

Additional information for recipients in Denmark

This Investment Recommendation does not constitute a prospectus under Danish securities law and consequently is not required to be

nor has been filed with or approved by the Danish Financial Supervisory Authority as this Investment Recommendation either (i) has not

been prepared in the context of a public offering of securities in Denmark or the admission of securities to trading on a regulated market

within the meaning of the Danish Securities Trading Act or any executive orders issued pursuant thereto, or (ii) has been prepared in the

context of a public offering of securities in Denmark or the admission of securities to trading on a regulated market in reliance on one or

more of the exemptions from the requirement to prepare and publish a prospectus in the Danish Securities Trading Act or any executive

orders issued pursuant thereto.

Additional information for recipients in Greece

The information contained herein describes the view of the author at the time of its publication and it must not be used by its Recipient

unless having first confirmed that it remains accurate and up to date at the time of its use.

Past performance, simulations or forecasts are therefore not a reliable indicator of future results. Mutual funds have no guaranteed

performance and past returns do not guarantee future performance.

Additional information for recipients in Ireland

This Investment Recommendation has not been prepared in accordance with Directive 2003/71/EC, as amended, on prospectuses (the

“Prospectus Directive”) or any measures made under the Prospectus Directive or the laws of any Member State or EEA treaty adherent

state that implement the Prospectus Directive or those measures and therefore may not contain all the information required where a

document is prepared pursuant to the Prospectus Directive or those laws.

Additional information for recipients in Luxembourg

Under no circumstances shall this Investment recommendation constitute an offer to sell, or issue or the solicitation of an offer to buy or

subscribe for Products or Services in Luxembourg.

http://www.dsgv.de/sicherungssystem



Additional information for recipients in Netherlands

The value of your investments may fluctuate. Results achieved in the past do not offer any guarantee for the future (De waarde van uw

belegging kan fluctueren. In het verleden behaalde resultaten bieden geen garantie voor de toekomst).

Additional information for recipients in Poland

This Investment Recommendation does not constitute a recommendation within the meaning of the Regulation of the Polish Minister of

Finance Regarding Information Constituting Recommendations Concerning Financial Instruments or Issuers thereof dated 19 October

2005.

Additional information for recipients in Portugal

This Investment Recommendation is intended only for institutional clients and may not be (i) used by, (ii) copied by any means or (iii)

distributed to any other kind of investor, in particular not to retail clients. This Investment Recommendation does not constitute or form

part of an offer to buy or sell any of the securities covered by the report nor can be understood as a request to buy or sell securities

where that practise may be deemed unlawful. This Investment Recommendation is based on information obtained from sources which

we believe to be reliable, but is not guaranteed as to accuracy or completeness. Unless otherwise stated, all views herein contained are

solely expression of our research and analysis and subject to change without notice.

Additional information for recipients in Sweden

This Investment Recommendation does not constitute or form part of, and should not be construed as a prospectus or offering

memorandum or an offer or invitation to acquire, sell, subscribe for or otherwise trade in shares, subscription rights or other securities

nor shall it or any part of it form the basis of or be relied on in connection with any contract or commitment whatsoever. This Investment

Recommendation has not been approved by any regulatory authority. Any offer of securities will only be made pursuant to an applicable

prospectus exemption under EC Prospectus Directive, and no offer of securities is being directed to any person or investor in any

jurisdiction where such action is wholly or partially subject to legal restrictions or where such action would require additional

prospectuses, other offer documentation, registrations or other actions.

Additional information for recipients in Switzerland

This Investment Recommendation has not been approved by the Federal Banking Commission (merged into the Swiss Financial Market

Supervisory Authority “FINMA” on 1 January 2009).

NORD/LB will comply with the Directives of the Swiss Bankers Association on the Independence of Financial Research, as amended.

This Investment Recommendation does not constitute an issuing prospectus pursuant to article 652a or article 1156 of the Swiss Code

of Obligations. This Investment Recommendation is published solely for the purpose of information on the products mentioned in this

advertisement. The products do not qualify as units of a collective investment scheme pursuant to the Federal Act on Collective

Investment Schemes (CISA) and are therefore not subject to the supervision by the Swiss Financial Market Supervisory Authority

(FINMA).

Additional information for recipients in Canada

This Investment Recommendation has been prepared for informational purposes only in relation to the products contained in this

material and is not, under any circumstances to be construed as an offering memorandum or as an offering of any securities for sale

directly or indirectly in any province or territory of Canada.

No securities commission or similar regulatory authority in Canada has passed on the merits of these securities nor has it reviewed this

material and any representation to the contrary is an offence.

Relevant selling restrictions, if any, are contained in the prospectus or other documentation for the respective product.

Additional information for recipients in Estonia

It is advisable to examine all the terms and conditions of the services provided by NORD/LB. If necessary, Recipient of this Investment

Recommendation should consult with an expert.

Additional information for recipients in Finland

The financial products described in this Investment Recommendation may not be offered or sold, directly or indirectly, to any resident of

the Republic of Finland or in the Republic of Finland, except pursuant to applicable Finnish laws and regulations. Specifically, in the case

of shares, those shares may not be offered or sold, directly or indirectly, to the public in the Republic of Finland as defined in the Finnish

Securities Market Act (746/2012, as amended). The value of investments may go up or down. There is no guarantee to get back the

invested amount. Past performance is no guarantee of future results.

Additional information for recipients in Czech Republic

There is no guarantee to get back the invested amount. Past performance is no guarantee of future results. The value of investments

could go up and down

The information contained in this Investment Recommendation is provided on a non-reliance basis and its author does not accept any

responsibility for its content in terms of correctness, accuracy or otherwise.



Arrangements for the confidential treatment of sensitive customer and business data as well as for avoiding and handling conflicts of

interest

NORD/LB has separated its business divisions that may have access to sensitive customer and business data (confidential areas) from

its other divisions (e.g. NORD/LB Research) in terms of functions and locations and/or via relevant data processing arrangements.

The disclosure of confidential information that may have an impact on the prices of securities is monitored by NORD/LB’s Compliance

Unit which is independent of its trading, operational and settlement divisions. This independent unit controls the transactions undertaken

by NORD/LB and its employees on a daily basis to ensure that they are in line with market conditions. The Compliance Unit may impose

such trading bans and restrictions as may be necessary to ensure that information, which may affect the prices of securities, is not

misused and to prevent confidential information from being disclosed to divisions that are only allowed to use information available to the

general public. To avoid conflicts of interest in connection with the preparation of financial analyses, the analysts of NORD/LB are

obliged to inform the Compliance Unit of any studies being drawn up and must not invest in the financial instruments handled by them.

They are obliged to notify the Compliance Unit of all transactions (including external transactions) undertaken by them for their own

account or for the account or on behalf of third parties. Thus the Compliance Unit is in a position to identify all unauthorized transactions

undertaken by the analysts, such as insider trading and front and parallel running. When a Investment Recommendation involving

conflicts of interest to be disclosed within the NORD/LB Group is drawn up, any information on such conflicts of interest will only be

made available by the Compliance Unit upon completion of the Investment Recommendation. Any subsequent amendment of the

relevant Investment Recommendation may only be made upon consultation with the Compliance Unit and when it has been ensured that

the results of the study are not affected by the knowledge of such conflicts of interest. Further information on these matters is set forth in

our Investment Recommendation or Conflict of Interest Policy which is available from the Compliance Unit of NORD/LB upon request.

Time of going to press

07.02.2017 17:00h

Disclosure of NORD/LB’s potential conflicts of interest according to § 34b Abs. 1 WpHG and

Article 5 and 6 according to the Commission Delegated Regulation (EU) 2016/958 of 9 March 2016

None.

Additional disclosures

Sources and price indications

Depending on the issuer, we use information from financial data suppliers, our own estimates, company data and the public media for the

preparation of our Investment Recommendations. Unless otherwise stated in the report, prices indicated relate to the closing price on the

previous day. Fees and commissions apply to securities (buy, sell, hold) and these may reduce the yield on investments.

Analytical methods and updates

In the preparation of Investment Recommendations, we take company-specific methods used for fundamental securities’ analysis and

quantitative/statistical methods, as well as technical analytical methods as the basis for valuations and for the regular updates. All

assumptions and analytical derivations related to our recommendation may be extracted from the underlying research analysis. It should

be noted that the results of analyses provide a snapshot overview and that past developments do not constitute a reliable indicator for

future profits. The basis of the valuations is subject to unforeseen change at any time, potentially leading to different conclusions. The

present report is prepared monthly basis. Recipients are not automatically entitled to receive report update publications. Detailed

information with respect to our rating methodology is available at the webpage www.nordlb-pib.de/Bewertungsverfahren.

Recommendation system Share of recommendation (12 months)

Positive: Positive expectations for the issuer, a security type or a

specific security of an issuer.

Neutral: Neutral expectations for the issuer, a security type or a


Negative: Negative expectations for the issuer, a security type or a


Relative value (RV): Relative value recommendation in comparison to

a market segment, an issuer or a maturity.

Positive: 52%

Neutral: 44%

Negative: 5%

Recommendation history (12 months)

An overview of all our bond recommendations during the last 12 months is available at the webpage www.nordlb-pib.de/empfehlungsuebersicht_renten. Corresponding password: "renten/Liste3".

Issuer / security Date Recommendation Bond type Cause

https://www.nordlb-pib.de/Bewertungsverfahren

https://www.nordlb-pib.de/empfehlungsuebersicht_renten

https://www.nordlb-pib.de/empfehlungsuebersicht_renten

fixed income research corporate bond strategy · in particular, higher debt levels and increased...

Documents