weekly credit update - microsoft · sell dong energy call 2023 (eur) – stay exposed to the short...

26 January 2016

Weekly Credit Update

Important disclosures and certifications are contained from page 36 of this report

Analysts Haseeb Syed +47 85 40 54 19 [email protected]

Katrine Jensen +45 45 12 80 56 [email protected]

Investment Research www.danskebank.com/CI

mailto:[email protected]

2 2

- General credit market news and current themes

- Credit indicators

- Scandi Investment Grade

Contents

- Coverage universe, credit ratings and recommendations

- Scandi High Yield

3 3

What’s on our minds - General credit market news

Source: Bloomberg, Danske Bank Markets (both charts)

• The global credit markets were generally impacted by high

volatility last week. At the beginning of last week, we saw a massive decline in the oil price, with plummeting share prices in several stock markets.

• The gloomy condition of the oil-related HY market prevailed last week. The value of debt issued by HY US energy companies has now decreased to the lowest levels for two decades. The bond prices dipped further to only 56, as the oil price came in at a 12-year low below $28/boe. Although the oil price rebounded to about $32/boe on Friday, it was still 14% lower than at the beginning of the year.

• During the week, the Itraxx Main (5yr) tightened 5bp, closing at 93bp, while Itraxx Crossover (5yr) tightened 18bp and closed at 370bp. On Wednesday last week, Itraxx Crossover spiked to 398bp, reaching its highest level since October 2013.

• At last week’s meeting, the ECB decided that the interest rate on MRO and interest rates on the marginal lending facility and the deposit facility will remain unchanged at 0.05%, 0.3% and -0.3%, respectively. In our view, the alleviation in the credit market later in the week can be attributed to Mario Draghi’s hints that the ECB may ease monetary policy as early as in its March meeting.

• The HY market in Norway is still under pressure due the historically low oil prices. Over the week, the overall activity declined, but we have seen some relatively low-volume issuances of senior bank bonds, covered bonds and utility bonds. The credit spreads of Norwegian financial companies remain stable.

4 4

Scandi high yield

VATFAL (Baa2/BB+) 6.1% '23

VATFAL (Baa2/BB+) 3.1% '22

VATFAL (Baa2/BB+) 3% '27

SSELN (Baa2/BBB) 5.6% '17

SSELN (Baa2/BBB) 2.4% '21

SEVFP (Baa2/NR) 2.5% '22

RWE (Ba1/BB+) 3.5% '25

IBESM (Baa3/BB+) 5.8% '18

GASSM (Ba1/BB+) 4.1% '22

GASSM (Ba1/BB+) 3.4% '24

ENGIFP (A3/BBB+) 3.9% '24

ENGIFP (A3/BBB+) 3.9% '18

ENELIM (Ba1/BB+) 6.5% '19

ENECO (NR/BBB) 3.3% '21

ENBW (Baa2/BBB-) 7.4% '17

ENBW (Baa2/BBB-) 3.6% '21

EDF (Baa1/BBB) 4.1% '22

DONGAS (Baa3/BB+) 6.3% '23

DONGAS (Baa3/BB+) 4.9% '18

DONGAS (Baa3/BB+) 3% '20

Corporate hybrids BB+

Corporate hybrids BBB-

Corporate hybrids BBB+

Corporate hybrids BBB

200

250

300

350

400

450

500

550

600

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

Mid Spread (EUR)*

YTW**

* Z-spreads. Discount margin for floaters. Swapped to indicated currency. ** Years-to-worstNote: Fair value curve(s) based on Danske Bank Markets' (mid) peer group of European issuers

Relative value (EUR), indicative mid spreads Credit spread development

Source: Bloomberg, Danske Bank Markets Source: Bloomberg, Danske Bank Markets

Key arguments for the trade

• Spread on the DONGAS call 2023 hybrid not adequate.

The bond trades ‘only’ slightly wider than the ‘BBB-’ fair value curve (see below) and is rated ‘BB+’ by S&P.

• Several longer term risks. We see a broad range of longer term challenges for DONG Energy, which are not reflected in the longer end of the curve.

• The call 2023 has call event risk. Being a high-coupon hybrid, the cash price is somewhat above 101, making the hybrid exposed to event risks allowing an issuer call (due to i.e. rating methodology or accounting change).

Sell DONG Energy call 2023 (EUR) – stay exposed to the short end

Published on 18 January 2016

• Longer term risks revolve around longer term share-holder friendliness after IPO, PSO (feed-in tariff) run-off on old wind parks, uncertainty about future of PSO, weak oil price (hedged only in 2016) and weak power prices.

• Recommendation. We prefer the short end of the DONG curve. In particular, we find the DONGAS 6.25% call 2023 too tight. We recommend selling this, possibly replacing it with the shorter DONGAS 4.875% call 2018. We also consider the DONGAS 3% call 2020 too tight.

• Trade Idea - Sell DONG Energy 6. 25% call 2023 (EUR), 18 January.

150

200

250

300

350

400

450

500

Mar-2015 May-2015 Jul-2015 Sep-2015 Nov-2015 Jan-2016

ASW spread

VATFAL EUR 3% 2027 (Hybrid)DONGAS EUR 4.875% 2018 (Hybrid)DONGAS EUR 6.25% 2023 (Hybrid)

http://danskeresearch.danskebank.com/abo/TradeRecommendationDONGEnergy180116/$file/TradeRecommendation_DONGEnergy_180116.pdf




STENA 7.9% '20 (EUR)

STENA 7% '24 (USD)


STENA 5Y CDS


STENA 5.8% '24 (USD)

Industrials B's

Industrials BB's

0

50

100

150

200

250

300

350

400

450

500

550

600

650

700

750

800

850

900

950

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

Credit Spread (EUR)*

Years to maturity**

* Spreads are swapped to indicated currency and prioritised in accordance with availability of Z-spread, discount margin** Years to legal maturity or years to first-call date Note: Fair value curve(s) based on Danske Bank Markets' peer group of European issuers

-20

30

80

130

180

230

280

330

380

430

480

530

Jul-2015 Sep-2015 Nov-2015 Jan-2016

ASW Issue Currency

STENA EUR 6.125% 2017 DFDSDC NOK 4.6% 2016

COLLIN NOK 5.56% 2017 TALLNK NOK 6.16% 2018

Relative value (EUR), indicative ask spreads Credit spread development



• Attractive valuation. Following recent spread widening, we believe the Stena 2017 trades at an attractive level.

• Strong short-term liquidity profile. The full redemption of the 2017 bond is covered by Stena’s current and expected liquid resources by a healthy margin over the next 12 months (as also confirmed by Stena’s CFO during the Q3 15 conference call).

• Covenant. We do not expect any bank covenant breach to occur before the maturity of the Stena 2017 bond.

Buy Stena 2017 (EUR) – underweight on all other Stena bonds


• Credit risk set to increase in Stena. Due to the high exposure to oil drilling (c.40% of EBITDA), we expect lower cash flows, significantly higher leverage (possibly over 8x adjusted net debt/EBITDA) and higher refinancing risk in Stena in coming years.

• Recommendation. We remain underweight on all Stena’s bonds except the Stena 2017 bond. We recommend buying the 2017 solely due to the strong liquidity coverage and the attractive valuation.

• Trade idea – Buy Stena 6.125% 2017 (EUR), 14 January.

http://danskeresearch.danskebank.com/abo/TradeRecommendationStena140116/$file/TradeRecommendation_Stena_140116.pdf




Relative value (EUR), ask spreads Credit spread development


SSABAS 4.9% '17 (SEK)

SSABAS 4.6% '19 (SEK)

SSABAS 3.9% '19 (EUR)

OUTOK 6.6% '19 (EUR)

Industrials BB-

Industrials B+

Industrials B

0

100

200

300

400

500

600

700

800

900

1000

1 2 3 4 5 6 7 8

Credit Spread (EUR)*

Years to maturity**

* Spreads are swapped to indicated currency and prioritised in accordance with availability of Z-spread, discount margin** Years to legal maturity or years to first-call date Fair value curves based on a sample of European issuers

300

400

500

600

700

800

900

1000

AS

W/

DM

in

ba

sis

po

ints

SSABAS 3 7/8 04/10/19 OUTOK 6 5/8 09/30/19SSABAS 0 04/03/18 SSABAS 4 7/8 12/13/17SSABAS 4 5/8 02/25/19

Key arguments for the trade:

• Fire sale following profit warning. The entire SSAB curve and especially the SSAB EUR 2019s took a harsh beating recently, trading down 13 full figures since the profit warning in early December. We believe low year-end market liquidity is partly to blame for the steep fall.

• Credit watch negative but with limited rating

downside. S&P has placed SSAB’s ‘BB-’ rating on CW negative but to our (positive) surprise the potential downgrade seems limited to one notch.

SSAB – BUY SSABAS 3.875 2019 (EUR)


• Attractive valuation. Despite tough steel market conditions, we believe the price reaction is overdone and we see the current level as a good entry point. The SSAB EUR 2019s (ASK Z+863bp) trade almost 300bp wider than the SSAB SEK 2019s and some 200bp wider than the ‘B’ rated EUR industrials curve, indicating attractive value, even in the case of a two-notch downgrade.

• Trade Idea - Buy SSAB EUR 2019, 13 January.

http://danskeresearch.danskebank.com/abo/SSABTradeRecommendation130116/$file/SSAB_TradeRecommendation_130116.pdf




8 8

Recent trade ideas (high yield)

Source: Danske Bank Markets

See the end of this document for a list of our coverage including shadow ratings and recommendations.

Type Trade Idea

Opened 18 Jan 2016Start spread 497Opened 14 Jan 2016Start spread 467

Opened 13 Jan 2016

Start spread 777

Opened 07 Dec 2015

Start spread 692

Opened 27 Oct 2015Start spread 105

Opened 27 Oct 2015Start spread 569

Opened 01 Oct 2015

Start spread -27

Opened 01 Oct 2015

Start spread 6

Opened 08 Sep 2015

Start spread 440

Outright Close of Trade Tallink NOK 2018. Bonds trade tight to `BB-`curve and bonds no longer attractive. We take profit on trade initiated 27 February 2015 (TR: 3.9% / ann. TR 7.9%).

Switch Sell Stena 2020, Buy TDC hybrid Fundamentally, we see increased credit risk in Stena and recommend investors switch into names with same or stronger credit profiles such as TDC (hybrid).

Switch Sell Stena 2020, Buy Volvo

hybrid

Fundamentally, we see increased credit risk in Stena and recommend investors switch into names with same or stronger credit profiles such as Volvo (hybrid).

Switch Buy Color Group NOK 2019, Sell

Tallink NOK 2018

Color Group spread pick up attractive versus Tallink

Outright Buy Color Group NOK 2019 Spread wide for the assessed rating

Outright Sell DONG Energy call 2023 The long end of the DONG Energy hybrid curve is too tight

Outright Buy Stena EUR2017 Attractive valuation 2017 bond. We remain underweight all other Stena bonds

Outright Buy SSAB EUR2019 The SSAB EUR2019 currently trades at very attractive levels compared to other outstanding SSAB bonds and compared to the current BB- rating from S&P

Outright Buy Norwegian Air Shuttle

EUR2019

The Norwegian Air Shuttle EUR2019 currently trades at very attractive levels compared to other outstanding NAS bonds and compared to our B+/NO shadow rating.

9 9

Best and worst performers (Nordic coverage universe) - High yield


1 month in local currencies YTD in local currencies

2,719

2,237

2,156

1,944

1,496

894

801

716

601

581

6

5

5

4

1

1

-2

-20

-97

-173

-500050010001500200025003000

Seadrill Ltd NOK 2018

Seadrill Ltd USD 2017

Seadrill Ltd SEK 2019

North Atlantic Drilling Ltd NOK 2018

Golden Close Maritime Corp Ltd USD …

Fred Olsen Energy ASA NOK 2019

J Lauritzen A/S NOK 2017

North Atlantic Drilling Ltd USD 2019

Olympic Ship AS NOK 2017

Teekay Offshore Partners LP/Teekay …

Orava Residential REIT PLC EUR 2020

Meda AB SEK 2019

Ahlstrom OYJ EUR 2019

Meda AB SEK 2018

Stora Enso OYJ SEK 2017

Hoist Kredit AB EUR 2017

Akelius Residential Property AB SEK …

Hoist Kredit AB SEK 2016

Beerenberg Holdco II AS NOK 2018

Teekay Offshore Partners LP NOK 2016

Change in local currencies (bp)

2,695

2,237

2,153

1,929

1,496

885

798

715

553

528

8

7

5

4

4

2

2

-16

-101

-176

-500050010001500200025003000

Seadrill Ltd NOK 2018


Seadrill Ltd SEK 2019

North Atlantic Drilling Ltd NOK 2018

Golden Close Maritime Corp Ltd USD …

Fred Olsen Energy ASA NOK 2019

J Lauritzen A/S NOK 2017

North Atlantic Drilling Ltd USD 2019

Olympic Ship AS NOK 2017


Stena International SA USD 2024

Heimstaden AB SEK 2019

Meda AB SEK 2019

Meda AB SEK 2018

Norwegian Air Shuttle ASA NOK 2017

Stora Enso OYJ SEK 2017

Hoist Kredit AB EUR 2017

Hoist Kredit AB SEK 2016

Beerenberg Holdco II AS NOK 2018

Teekay Offshore Partners LP NOK 2016


10 10

Danske Bank Markets Nordic High-Yield Index

Source: Bloomberg, Danske Bank Markets [all tables and charts]

Danske Bank Markets Nordic High-Yield Index

Index sector breakdown Key index statistics

• The start of 2016 has been a rough ride for the European high-yield credit markets despite the slight sentiment change last week.

• iTraxx crossover tightened some 10bp over the past week and currently trades around 371bp. Our Danske Bank Markets Nordic High-Yield Index did not follow this trend and widened marginally over the week (+2bp). We caution that the liquidity in the Nordic high-yield market is currently thin.

• We are still waiting for the first primary Nordic high-yield transaction in 2016.

Basic Materials

12%Communicat

ions8%

Consumer, non-cycli.

10%

Energy14%

Diversified4%

Industrial19%

Consumer, Cyclical

9%

Utilities7%

Real estate13%

Technology2%

300

325

350

375

400

425

450

475

500

525

550

575

95.0

96.0

97.0

98.0

99.0

100.0

101.0

102.0

103.0

104.0

105.0

106.0

Dec/2014 Mar/2015 Jun/2015 Sep/2015 Dec/2015

DBM Hedged EUR Nordic HY Index Value

DBM Nordic HY Index, ASW-spread (bps). RHS

Index start Index end Change

Date 31/Dec/2014 22/Jan/2016

Yield 5.6%

ASW spread, bps 430 555 125

# Bonds 107

AVG credit rating BB

Avg duration 2.9

TR since start -1.0%

TR YTD -2.4%

TR MTD -2.4%

11 11

Recent Nordic high-yield issuance

Source: Bloomberg, Danske Bank Markets

Selected new issues (High Yield)

Date Issuer Coupon CCY Volume Maturity S&P / Mdy / Fitch ASW/DM

15/12/2015 Bulk Industrier As NIBOR3M +700bps NOK 200 m Dec/18 / / 700

15/12/2015 Bong Ab 10% SEK 200 m Dec/18 / / 1024

11/12/2015 Barcode 121 Holding Ag 3.75% NOK 2 535 m Dec/24 / / 232

11/12/2015 B121 Holding As 5.75% NOK 390 m Dec/20 / / 444

10/12/2015 Stockmann Ab (Hybrid) 7.75% EUR 85 m PERP / / 717

09/12/2015 West Atlantic Ab 6.5% SEK 850 m Dec/19 / / 611

01/12/2015 Norwegian Air Shuttle As 7.25% EUR 125 m Dec/19 / / 700

19/11/2015 Ab Stena Metall Finans STIB3M +350bps SEK 1 000 m Nov/20 / / 350

17/11/2015 Jefast Holding Ab STIB3M +650bps SEK 200 m Jan/19 / / 650

13/11/2015 Vattenfall Ab (Hybrid) 6.1% USD 400 m Nov/78 BB+ / Baa2 / A- 406

29/10/2015 Marine Harvest Asa (Convertible) 0.125% EUR 340 m Nov/20 / / -

26/10/2015 Ssab Ab STIB3M +250bps SEK 300 m Apr/18 BB- *- / / 250

21/10/2015 Verisure Holding Ab STIB3M +725bps SEK 2 816 m Oct/23 CCC+ / Caa1e / 725

21/10/2015 Verisure Holding Ab EUR003M +725bps EUR 400 m Oct/23 CCC+ / Caa1e / 725

23/10/2015 Verisure Holding Ab 6% EUR 700 m Nov/22 B / B1 / 591

01/10/2015 Finnair Oyj (Hybrid) 7.875% EUR 200 m PERP / / 754

16/09/2015 Akelius Residential Ab 3.375% EUR 300 m Sep/20 BB+ / / 300

03/09/2015 Lock As 7% EUR 30 m Aug/21 B+ / B2 / 505

03/09/2015 Lock As 5.5% EUR 200 m Aug/20 B+ / B2 / 550

03/09/2015 Np3 Fastigheter STIB3M +490bps SEK 300 m Oct/18 / / 490

02/09/2015 Sagax Ab EUR006M +350bps EUR 30 m Sep/20 / / 350

13/07/2015 Boa Offshore As NIBOR3M +1000bps NOK 150 m Dec/18 / / 1000

06/07/2015 Gripship As NIBOR3M +650bps NOK 210 m Jul/18 / / 650

03/07/2015 Digiplex Norway As NIBOR3M +375bps NOK 575 m Jul/19 / / 375

12 12

Company news from the past week (high yield)


Name News Implication

Nokia

Nokia (NR): Moody's comments on the recent merger between Nokia and ALU and how the new entity's performance will move closer in line with rival Ericsson: ‘While Ericsson remains the industry leader in terms of scale and market share in some wireless equipment markets, Nokia's merger with Alcatel-Lucent could make Nokia a more formidable challenger as it expands its footprint, benefits from scale economies and becomes a stronger player among fewer competitors’. Moody's positive stance on Nokia to us signals that the group could be due for a rating upgrade by the agency during 2016. Moody's Ba2 (stable) rating is currently one-notch behind S&P's ‘BB+’ (Positive outlook). Still Nokia's 2019's are currently trading at about Z+100 i.e. much of the positive sentiment is already reflected in pricing. As a reference Ericsson's USD denominated 2022's are trading at around Z+138 (EUR equivalent).

Credit neutral

Ahlstrom

Ahlstrom (DBM: 'BB-'): Ahlstrom announces that it will divest its non-wovens & fabrics operations for EUR73m to Owens Corning. The assets to be acquired by Owens Corning include operations in Karhula and Mikkeli, Finland, and Tver, Russia. Collectively, the facilities employ approximately 260 people and reported 2014 sales of EUR77m i.e. some 7% of Ahlstrom's revenues. The unit to be divested is part of the Building and energy business which has been performing poorly relative to Ahlstrom's other business segments (rolling 12m EBIT of c. -EUR7m). Unless divestment proceeds are paid to shareholders, Ahlstrom's adj. net debt to EBITDA should drop from 4.2x to 3.5x. Overall positive for the credit, in our view.

Credit positive

Outokumpu

Outokumpu (DBM:'B-'): Austrian oil and gas company OMV has just announced that it will be hiring the CFO of Outokumpu, Mr Reinhard Florey. Florey will stay in his current position until 1 August 2016 at the latest. Florey has been with Outokumpu since 2013. Overall this is slightly negative for the credit as part of the (remaining) investor confidence is tied to Mr Florey and his many years of experience from executive roles in the steel industry prior to joining Outokumpu.

Credit negative

13 13

Scandi investment grade

Seek refuge during turbulent times – Buy DNA 18’s or 21’s


14

Relative value (EUR), indicative mid spreads Credit spread development



• The DNALTD 2018’s and DNALTD 2021’s offer

attractive value. The DNA curve trades wide both in relation to Nordic peers and to the ‘BBB-’ EUR TMT curve.

• Low-cyclical industries outperform during market

turbulence. Looking at the historical spread development of the longer dated DNALTD 2021’s, the bond has stood its ground despite high market turbulence during the last couple of months. Looking back a full year the spread has tightened in a period where other Nordic telcos have widened.

• Conservative leverage targets. DNA has communicated that it intends to reach a leverage below 2x by 2016. This was already achieved following the Q3 15 result when adj. net debt to adj. EBITDA reached 1.9x.

• Operates on less competitive Finnish mobile market.

Unlike the Swedish and Danish mobile market, which have four facility-based operators, the Finnish market contains three (ELISA, DNA and TeliaSonera), creating grounds for a more benign competitive environment.

• Trade Idea – Buy DNALTD 18’s or 21’s, 25 January 2016.


-50

0

50

100

150

200

250

Feb-2015 May-2015 Aug-2015 Nov-2015

ASW Issue Currency

TLSNSS EUR 1.375% 2019 TELNO EUR 1.75% 2018TDCDC EUR 3.75% 2022 ELIAV EUR 2.75% 2021DNALTD EUR 2.875% 2021 IBOXX EURO Telecommunications

TDCDC (Baa3/NR) 4.375% '18

TDCDC (Baa3/BBB-)

3.75% '22

TDCDC (Baa3/BBB-)

1.75% '27

ELIAV (Baa2/BBB+)

2.75% '21ELIAV (Baa2/BBB+)

2.25% '19

DNALTD (NR/NR) 2.875% '21

DNALTD (NR/NR) 2.625% '18

TMT BBB-

TMT BBB

0

50

100

150

200

250

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

Mid Spread (EUR)*

YTW**

* Z-spreads. Discount margin for floaters. Swapped to indicated currency. ** Years-to-

Note: Fair value curve(s) based on Danske Bank Markets' (mid) peer group of European issuers

http://danskeanalyse.danskebank.dk/abo/DNAtraderecommendation250116/$file/DNA_trade_recommendation_250116.pdf




15 15

Recent trade ideas (investment grade)


See the end of this presentation for a list of our coverage including shadow ratings and recommendations

Recent ideas

Type Trade Idea

Opened 26 Jan 2016Start spread 175Opened 26 Jan 2016Start spread 114

Opened 30 Nov 2015

Start spread 86

Opened 16 Nov 2015

Start spread 161

Opened 09 Nov 2015Start spread 16

Opened 09 Nov 2015Start spread 92

Opened 24 Aug 2015

Start spread 270

Opened 10 Aug 2015

Start spread 511Opened 10 Aug 2015

Start spread 361

Outright Buy Nykredit T2 CoCo first call

2021 (dated)

Nykredit has issued a tier 2 bond as a CoCo with a 7% trigger.We believe the T2 CoCo trades with a discount to peers because of the CoCo feature.

Outright Buy Nykredit AT1 (perpetual) Nykredit has issued an AT1 with a 7.125% trigger.This hybrid trade attractive to Nordic peers.

Outright Buy Vestas 2022 (revisited). The Vestas EUR 2.75% 2022 trades cheap to a EUR corporate BBB. curve.

Switch Buy Securitas EUR 2021, Sell

G4S EUR 2018

One notch higher rating and no risk of near term M&A in Securitas makes pick up attractive.

Outright Buy Securitas EUR 2021 Spread has widened too much post the Diebold acquisition

Outright Buy DFDS NOK FRN 2016 Short FRN trades attractive both on RV and absolute basis.

Outright Close of buy Neste EUR2022 We close our Buy Neste 22's trade recommendation

Outright Buy DNA EUR 2021 We see attractive value in the DNA 2021's

Outright Buy DNA EUR 2018 We see attractive value in the DNA 2018's

16 16

Best and worst performers (Nordic coverage universe) - Investment grade


1 week in local currencies 1 month in local currencies

8

7

7

5

4

4

4

3

3

3

-3

-3

-3

-3

-3

-3

-4

-4

-4

-4

-6-4-20246810

Vestas Wind Systems A/S EUR 2022

Neste Oyj EUR 2016

Nordea Bank AB EUR 2017

SKF AB EUR 2018

Svenska Handelsbanken AB EUR 2017

Swedbank AB EUR 2017

Statkraft AS EUR 2019


DONG Energy A/S EUR 2016

Volvo Treasury AB EUR 2017

Telenor ASA EUR 2025


SBAB Bank AB EUR 2020

Elisa OYJ EUR 2021

Statoil ASA EUR 2020

TeliaSonera AB EUR 2022



Fingrid OYJ EUR 2024

Svenska Cellulosa AB SCA EUR 2025


31

24

23

20

15

14

13

13

12

12

-10

-10

-10

-10

-10

-10

-11

-14

-15

-16

-20-10010203040

Neste Oyj EUR 2016

ISS Global A/S EUR 2021

Vestas Wind Systems A/S EUR 2022


DONG Energy A/S EUR 2016

Nordea Bank AB EUR 2017

Sampo Oyj EUR 2017




Swedish Match AB SEK 2020



Skandinaviska Enskilda Banken AB EUR …

Kemira OYJ EUR 2022



Swedbank AB SEK 2020

Fortum Varme Holding samagt med …

Fortum Varme Holding samagt med …


17 17

Selected new investment-grade issues


Date Issuer Coupon CCY Volume Maturity S&P / Mdy / Fitch ASW/DM

22/01/2016 Swedish Match Ab 1.875% SEK 500 m Jan/21 BBB / Baa2 / N/A

22/12/2015 Vela Consumer Srl 0.7% EUR 838 m Apr/32 / / AA N/A

22/12/2015 Vela Consumer Srl EUR003M +0bps EUR 347 m Apr/32 / / 0

22/01/2016 Agder Energi As 3.05% NOK 300 m Jan/26 / / N/A

22/01/2016 Banca Imi Spa 3.1% EUR 250 m Jan/26 BBB- / Baa1 *+ / BBB+ 75

22/01/2016 Bpce Sa EUR003M +27bps EUR 1 500 m Feb/18 A / A2 / A 27

21/01/2016 Eidsiva Energi As NIBOR3M +150bps NOK 400 m Feb/21 / / 150

21/01/2016 Volvofinans Bank Ab STIB3M +70bps SEK 300 m Jan/18 / A3e / 70

21/01/2016 National Grid Na Inc EUR003M +42bps EUR 200 m Jan/18 A- / Baa1 / 42

20/01/2016 Akademiska Hus 0.11% SEK 1 000 m Jan/18 AA / / N/A

19/01/2016 Vastra Malardalen STIB3M +90bps SEK 300 m Jan/19 / / 90

19/01/2016 Central Bank Of Savings EUR003M +75bps EUR 250 m Jan/18 BBB+ / / 75

18/01/2016 Sparebanken Nord Norge NIBOR3M +131bps NOK 300 m Jan/21 / A1 / A 131

18 18

Company news from the past week (investment grade)



Vestas

Vestas (Overweight, DBM Shadow rating `BBB`). A small follow-up on our note sent out last week. The EUR500m Vestas March 2022 bond is currently the only financial debt Vestas has on its balance sheet. When adjusting for off-balance sheet debt-like liabilities such as project-related loss guarantees, operating leases, pension deficits etc. we reach an estimated adjusted debt figure of some EUR1.1bn as per end 2015. Since our estimate of the intrinsic value of the annuity-like wind turbine service business is around EUR3.5bn (using recent transaction multiples), the value of the service business alone covers the total adjusted debt of Vestas more than 3x (not factoring in any excess cash and the value of remaining balance sheet assets). In short there is likely a very high amount of excess ‘collateral-value’ backing the Vestas 2022 bond.

Credit positive

Jyske Bank

Jyske pre-announced 2015 net profit on Monday. It expects net profit for the year to be 2.476bn compared with the median consensus estimate of 2.350bn, so slightly better than expectations. Jyske expects the CET1 ratio and the capital ratio to come in at 16.2% and 17.1%, respectively – an improvement versus the 15.8% and 16.9% at end-Q3 15. RoE expected at 11.6%. As this was only slightly better than expectations, this will likely be neutral for the credit.

Credit neutral

Vestas

After recent spread widening in the Vestas 2022 bond we have updated our financial projections and general take on the name. Following our review we upgrade the shadow rating one notch to ‘BBB’. Given our upgrade of the credit profile and the expected limited correlation between oil/natural gas and Vestas order inflow, we reiterate our Overweight recommendation. At the current pricing (ask) of around ASW +280bp, we find the March 2022 bond attractively priced from a relative value credit spread perspective – and even more so following recent spread widening and our stronger view of the credit profile.

Credit positive

BillerudKorsnäs

BillerudKorsnäs (DBM:'BBB-'). Production problem sees negative impact on the Q4 results. This has already previously been communicated but the problems were worse than anticipated and therefore the results will be negatively impacted by SEK245m versus SEK165m previously. While this is negative we do not expect it to affect spreads to any significant degree.

Credit neutral

TVO

As a reply to French economy minister Macron's statement on Wednesday about TVO (OW) and Areva needing to quickly find a solution to their dispute about who has to pay for the OL3 delay, the Finnish economy minister Olli Rehn stated Thursday that the governments should not interfere in an ongoing inter-corporate legal battle. As such it seems likely that the French are most interested in a hasty solution, increasing the likelihood of a higher French willingness to settle the dispute quickly and in compensation for doing so, paying a sweetener to TVO. Credit neutral for now.

Credit neutral

19 19




Statoil

Statoil’s (UW) ’Aa2’ rating is put on review for downgrade by Moody’s. This follows Moody’s seeing increasing earnings pressure on a broad array of energy companies following the lower oil price. The agency sees lower scope for oil price recovery than most of the companies covered. Moody’s gloomy outlook is a reflection of new supply coming from Iran more than offsetting lower short-term US shale oil production. This coupled with continued demand weakness from especially China and India makes Moody’s bearish on the oil price. Apart from Statoil, the ratings of EBN, Shell and Total have also been placed on review for downgrade. Moody’s expects to finalise the review during Q1 16. Currently Statoil is rated ‘AA-/NO‘ with S&P. We clearly also expect this rating to be cut in the short term. As we fear that Moody’s review could end up in a multi-notch downgrade, we would not be surprised to see both agencies cutting Statoil to single-A territory in 2016. Mildly credit negative for Statoil’s spreads.

Credit negative

Vestas

Vestas (Overweight, DBM Shadow rating `BBB-`). Last week Vestas announced the acquisition of Availon, a German independent turbine service provider, for a cash price of EUR88m (EV/EBITDA: 16.9x). This acquisition comes after Vestas announced the acquisition of the American independent service provider UpWind Solutions for EUR50m (EV/EBITDA: 17.7x) back in December. The motive for the acquisition of Availon is identical to what drove the acquisition of UpWind Solutions. To increase volume, to add technical capabilities and to become a fleet wide partner. It is our impression that a majority share of both Availon and UpWind Solutions turbines under service are from manufacturers other than Vestas. Before the acquisitions Vestas services 1-2 GW of non-Vestas turbines. Combined UpWind Solutions and Availon add c.4GW of non-Vestas turbines under service. We view this factor as a key to support growth for the service business over time. While Vestas has an EBITDA margin of c.20% for its service business both Availon and UpWind Solutions have EBITDA margins below 10%. Part of the upside in these acquisitions is therefore to lift the profitability of these companies to the level of Vestas. While we are optimistic that Vestas can carry out this task, it will create some short-term margin dilution in the service division. Due to the limited size of the transactions we think these service business acquisitions will not in any way impair the very strong financial profile of Vestas. In addition, these two acquisitions will likely increase the quality of earnings due to the annuity-like income in the turbine service business as compared to the more volatile turbine project cash flows. Overall we view these acquisitions as slightly credit positive despite the steep purchase prices paid in both transactions.

Credit positive

20 20




Castellum

Castellum delivered a strong performance in Q4. Rental income rose by 3.4% and income from property management was up 13%, while leverage declined somewhat from Q3 15. With further yield compression, property valuations rose by SEK1bn. Compared with most other listed Swedish real estate companies, Castellum has lower leverage, making it somewhat less sensitive to changes in economic cycles and to interest rate fluctuations. Considering the company’s conservative financial policy and high share of unencumbered assets, we equalise our bond rating with the corporate rating at ‘BBB-’. We consider Castellum’s bonds somewhat tight relative to those of Swedish peers Wallenstam and Atrium Ljungberg. In the cross-over segment, we prefer Akelius Residential (both in SEK and EUR), which we see as more attractively priced.

Credit positive

TVO

News on TVO’s (OW) arbitration with Areva. According to Reuters, French economy minister Macron, has, after having consulted the Finnish economy minister, Olli Rehn , announced that Areva and TVO should reach an agreement during the coming month. To recap, TVO has sued Areva for EUR2.7bn because Areva didn’t finish the OL3 reactor on time (delayed from 2009 to late 2018). Areva has sued TVO for EUR3.4bn for not having obtained all the relevant construction approvals from the Finnish regulator. It is unclear what Mr Macron’s announcement means in practice. But a solution to the OL3 arbitration is an important obstacle that should be cleared before a final decision on the EdF/Areva NP merger can be made. Therefore it is likely that the French are most eager for a swift solution, meaning that they could be willing to accept a compromise tilted in favor of TVO in exchange for this issue going away. Credit neutral for now.

Credit neutral

Fortum

Fortum (UW) announced that it will take a EUR185m impairment charge in its Q4 15 results. This relates to some EUR110m relating to lower earnings on Fortum’s two coal stations in Finland, Inkoo and Meri-Pori. In addition to this, Fortum also wrote-down some EUR75m on its valuation of its derivatives. Overall this is credit negative as this will weigh on an already weak P&L for 2015 burdened by very low power prices. LTM clean EBIT stood at EUR1.01bn after Q3 15. We continue to think that Fortum’s ‘Baa1’/’BBB+’ with stable outlook could be a candidate for a negative rating move this year.

Credit negative

Vattenfall

Vattenfall (MW) was downgraded to ’BBB+/S’ from ’A-/NO’ by Fitch. This leaves the hybrid ratings at ‘BBB-‘. The downgrade reflects Vattenfall’s continuing problems with weak generation spreads in Germany, the Netherlands and Sweden on the back of low power prices in all regions. Fitch acknowledges Vattenfall’s attempts to protect its leverage by reducing capex and costs, but also finds this inadequate to defend the previous ‘A-‘ rating. The downgrade, which takes Fitch’s rating to par with S&P’s and one lower than Moody’s, shouldn’t take the market by surprise, and we label this as mildly credit negative.

Credit negative

21 21 Credit Indicators

Credit indicators

22 22

Chart pack: euro spreads and returns

Source: Macrobond Financial, Danske Bank Markets [all charts]

Euro IG ASW, iBoxx indices

Euro HY ASW, Merrill Lynch indices

IG total return, iBoxx indices, 2014-01=100

HY total return, Merrill Lynch indices, 2014-01=100

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Chart pack: relative value Source: Bloomberg, Macrobond Financial, Danske Bank Markets [all charts]

iTraxx vs iBoxx

Euro vs US CDS indices - IG (Markit)

EUR CDS spreads – Nordic banks

Euro vs US HY bond indices (Merrill Lynch)


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Chart pack: general market development

Source: Macrobond Financial , Danske Bank Markets [all charts]

European swap and government yields

Euro swap curve spread

3M Libor, US and euro area

EUR/USD basis swaps

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Chart pack: high-yield funds flow

Source: Bloomberg, Danske Bank Markets [all charts]

High-yield Europe ETF fund flow High yield US ETF fund flow

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Chart pack: fund flows


Europe, net sales

Sweden, net sales

US, net sales

Norway, net sales

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Chart pack: macro


GDP y/y growth, calendar adjusted

Euro area y/y change in bank lending

Purchasing Manager Indices

Euro area lending standards

28 28

Coverage universe, credit ratings

and recommendations

29 29

Our coverage and shadow ratings 1 of 6

Source: Standard & Poor's, Moody's, Fitch, Danske Bank Markets

Ratings from S&P/Moody's/Fitch and Danske Bank Markets shadow ratings

Analyst(s)

Company Rating Outlook Sr. Unsec Rating Outlook Rating Outlook Rating OutlookAhlstrom Oyj BB- Stable M. Rosendal / J. MagnussenAkelius Residential Property Ab BBB- Stable E. Hjalmarsson / L. Landeman OVERWEIGHTAmbu A/S BBB- Stable J. Magnussen / M. RosendalAp Moeller - Maersk A/S BBB+ Stable Baa1 Pos B. Børsting/J. Magnussen MARKETWEIGHTArla Foods Amba BBB Stable M. Rosendal / B. BørstingAtlas Copco Ab A Stable A2 Stable A Stable M. Rosendal / E. Hjalmarsson UNDERWEIGHTAvinor As AA- Stable A1 Stable G. Bergin / L. Landeman MARKETWEIGHTBank 1 Oslo Akershus As BBB+ Stable L. Holm / K. JensenBank Norwegian As BBB Stable L. Holm / K. JensenBeerenberg Holdco Ii As B Stable Ø. MossigeBillerudkorsnas Ab BBB- Stable M. Rosendal / L. LandemanBw Offshore BB+ Stable Ø. MossigeCargotec Oyj BBB- Stable M. Rosendal / E. HjalmarssonCarlsberg Breweries A/S Baa2 Neg BBB Stable B. Børsting / M. Rosendal MARKETWEIGHTCastellum Ab BBB- Stable L. Landeman / P. AhmarinejadCermaq Asa BB Stable K. BakkenCitycon Oyj BBB Stable Baa1 Stable E. Hjalmarsson / L. Landeman OVERWEIGHTColor Group As BB- Stable B+ N. Ripa / B. BørstingCom Hem Holding Ab BB- Pos M. Rosendal / J. MagnussenCorem Property Group Ab BB- Stable B+ E. Hjalmarsson / L. LandemanDanfoss A/S BBB Stable J. Magnussen / B. BørstingDanske Bank A/S A Stable A2 Stable A StableDeep Sea Supply Plc B- Neg I. Båtvik / Ø. MossigeDestia Group Oy BB- Stable B+ M. Rosendal / E. HjalmarssonDfds A/S BBB- Stable N. Ripa / B. BørstingDlg Finance As BB- Stable M. Rosendal / B. BørstingDna Ltd BBB- Stable M. Rosendal / J. MagnussenDnb Bank Asa A+ Neg Aa3 Stable L. Holm / K. Jensen UNDERWEIGHTDof Asa B+ Neg I. Båtvik/Ø. MossigeDof Subsea As B+ Neg I. Båtvik/Ø. MossigeDolphin Group As I. BåtvikDong Energy A/S BBB+ Stable Baa1 Stable BBB+ Stable J. Magnussen / L. Landeman MARKETWEIGHT

Recomm.Danske Bank S&P Moody's Fitch

30 30




Analyst(s)

Company Rating Outlook Sr. Unsec Rating Outlook Rating Outlook Rating OutlookDsv A/S BBB Stable B. Børsting / M. RosendalEg Holding B Stable J. Magnussen / N. RipaEidesvik Offshore Asa B Neg I. Båtvik / Ø. MossigeEika Boligkreditt As A- Stable L. Holm / K. JensenEika Gruppen As BBB Stable L. Holm / K. JensenEksportfinans Asa BBB- Pos Ba3 Stable L. Holm / K. JensenElectrolux Ab BBB+ Stable Wr WD B. Børsting / M. Rosendal MARKETWEIGHTElenia Oy BBB J. Magnussen / L. Landeman MARKETWEIGHTElisa Oyj BBB+ Stable Baa2 Stable M. Rosendal / J. Magnussen MARKETWEIGHTEntra Eiendom As A- Stable O. Heldal / L. LandemanFarstad Shipping Asa B Stable B- I. Båtvik / Ø. MossigeFastpartner Ab BB Stable BB- L. Landeman / E. HjalmarssonFingrid Oyj A+ Pos A1 Stable A+ Stable J. Magnussen / L. Landeman MARKETWEIGHTFinnair Oyj BB Stable B. Børsting / M. RosendalFortum Oyj BBB+ Stable Baa1 Stable BBB+ Stable J. Magnussen / L. Landeman UNDERWEIGHTFortum Varme Holding Samagt Med Stockholms Stad Ab BBB+ Stable J. Magnussen / L. LandemanFred Olsen Energy Asa BB- Stable B+ S. Stormyr / B.K. RøedG4S Plc BBB- Stable B. Børsting / M. Rosendal MARKETWEIGHTGetinge Ab BB+ Neg L. Landeman / E. HjalmarssonGolar Lng Partners Lp BB Stable BB- B.K. Røed / J. MeyerGolden Close Maritime Corp Ltd B- S. Stormyr / B.K. RøedHavila Shipping Asa CCC+ Neg I. Båtvik / Ø. MossigeHeimstaden Ab BB Stable BB- L. Landeman / E. HjalmarssonHemso Fastighets Ab A- Stable E. Hjalmarsson / L. LandemanHexagon Ab BBB- Stable E. Hjalmarsson / L. LandemanHkscan Oyj BB Stable B. Børsting / M. RosendalHoegh Lng Holdings Ltd BB- Stable B+ B.K. Røed / J. MeyerHoist Kredit Ab BB- Stable B+ G. Bergin / L. LandemanHusqvarna Ab BBB- Pos E. Hjalmarsson / L. LandemanIca Gruppen Ab BBB Stable G. Bergin / L. LandemanIkano Bank Ab BBB Stable L. Holm / K. JensenInvestor Ab AA- Stable Aa3 Stable B. Børsting / M. Rosendal OVERWEIGHTIss A/S BBB- Pos B. Børsting / M. Rosendal OVERWEIGHT


31 31




Analyst(s)

Company Rating Outlook Sr. Unsec Rating Outlook Rating Outlook Rating OutlookJ Lauritzen A/S B Stable B- B.K. Røed / J. MeyerJefast Holding Ab B Stable B E. Hjalmarsson / L. LandemanJernhusen Ab A- Stable E. Hjalmarsson / L. LandemanJyske Bank A/S A- Stable Baa1U Stable L. Holm / K. Jensen OVERWEIGHTKemira Oyj BBB- Stable Wr M. Rosendal / L. Landeman OVERWEIGHTKesko Oyj BBB Stable M. Rosendal / E. HjalmarssonKlaveness Ship Holding As BB- Stable B+ B.K. Røed / J. MeyerKlovern Ab BB+ Stable BB E. Hjalmarsson / L. LandemanLantmannen Ek For BBB- Stable G. Bergin / L. LandemanLoomis Ab BBB- Stable B. Børsting / M. RosendalLuossavaara-Kiirunavaara Ab BBB Stable L. Landeman / E. HjalmarssonMeda Ab BB- Stable L. Landeman / E. HjalmarssonMetsa Board Oyj BB Stable Ba2 Stable M. Rosendal / E. Hjalmarsson OVERWEIGHTMetso Oyj BBB Stable Baa2 Stable M. Rosendal / L. Landeman MARKETWEIGHTNcc Ab BBB- Stable E. Hjalmarsson / L. LandemanNeste Oyj BBB- Stable J. Magnussen / L. Landeman MARKETWEIGHTNibe Industrier Ab BBB- Stable E. Hjalmarsson / L. LandemanNokia Oyj BB+ Pos Ba2 Stable BB Pos M. Rosendal / J. Magnussen MARKETWEIGHTNokian Renkaat Oyj BBB+ Stable J. Magnussen / M. RosendalNordax Bank Ab BBB- Stable L. Holm / K. JensenNordea Bank Ab AA- Neg Aa3 Stable AA- Stable L. Holm / K. Jensen UNDERWEIGHTNorth Atlantic Drilling Ltd B+ Neg B S. Stormyr / B.K. RøedNorwegian Air Shuttle Asa BB- Neg B+ B. Børsting / M. RosendalNorwegian Property Asa BBB- Stable O. Heldal / L. LandemanNykredit Bank A/S A Neg Baa3U Stable A Stable L. Holm / K. Jensen OVERWEIGHTNynas Group B+ Stable B+ J. Magnussen / L. LandemanOcean Rig Udw Inc B- Stable Ca Neg S. Stormyr / B.K. RøedOcean Yield Asa BB BB- Ø. MossigeOdfjell Se B+ Stable B B.K. Røed / J. MeyerOlav Thon Eiendomsselskap Asa BBB+ Stable O. Heldal / L. LandemanOlympic Ship As B+ Stable B I. Båtvik/Ø. MossigeOrava Residential Reit Plc B+ Stable B+ M. Rosendal / L. Landeman


32 32




Analyst(s)

Company Rating Outlook Sr. Unsec Rating Outlook Rating Outlook Rating OutlookOrkla Asa BBB+ Pos O. Heldal / L. LandemanOutokumpu Oyj B- Neg M. Rosendal / E. HjalmarssonPacific Drilling Sa B- Neg Caa2 Neg S. Stormyr / B.K. RøedPetroleum Geo-Services Asa B+ Neg B1 Neg I. BåtvikPohjola Bank Oyj AA- Neg Aa3 Stable WD L. Holm / K. Jensen MARKETWEIGHTPosten Norge As A- Stable G. Bergin / L. LandemanPostnord Ab BBB+ Stable G. Bergin / L. LandemanProsafe Se BB Stable BB- S. Stormyr / B.K. RøedRamirent Oyj BB+ Stable B. Børsting / M. RosendalRem Offshore Asa B- Neg I. Båtvik / Ø. MossigeSaab Ab BBB+ Stable Wr E. Hjalmarsson / L. LandemanSandnes Sparebank BBB+ Stable L. Holm / K. JensenSandvik Ab BBB Neg M. Rosendal / E. Hjalmarsson MARKETWEIGHTSas Ab B- Stable Wr Stable B. Børsting / M. RosendalSbab Bank Ab A Neg A2 Stable L. Holm / K. Jensen MARKETWEIGHTScania Ab BBB+ Neg M. Rosendal / B. Børsting UNDERWEIGHTSchibsted Asa BBB Stable O. Heldal / L. LandemanSeadrill Ltd BB- Stable B+ S. Stormyr / B.K. RøedSecuritas Ab BBB Stable Wr B. Børsting / M. Rosendal MARKETWEIGHTShip Finance International Ltd BB Stable BB- Wr B.K. Røed / J. MeyerSiem Offshore Inc B- Neg I. Båtvik / Ø. MossigeSkandinaviska Enskilda Banken Ab A+ Stable Aa3 Stable A+ Pos L. Holm / K. Jensen OVERWEIGHTSkanska Ab BBB+ Stable E. Hjalmarsson / L. LandemanSkf Ab BBB Neg Baa1 Neg M. Rosendal / E. Hjalmarsson UNDERWEIGHTSognekraft As BBB Stable BBB J. Magnussen / L. LandemanSolstad Offshore Asa BB- Stable B+ I. Båtvik / Ø. MossigeSpar Nord Bank A/S BBB+ Stable L. Holm / K. JensenSparebank 1 Boligkreditt As A- Stable L. Holm / K. JensenSparebank 1 Nord Norge A1 Stable A Stable L. Holm / K. Jensen UNDERWEIGHTSparebank 1 Smn A1 Stable A- Stable L. Holm / K. Jensen MARKETWEIGHTSparebank 1 Sr-Bank Asa A1 Stable A- Stable L. Holm / K. Jensen UNDERWEIGHTSponda Oyj BBB- Stable E. Hjalmarsson / L. Landeman


33 33




Analyst(s)

Company Rating Outlook Sr. Unsec Rating Outlook Rating Outlook Rating OutlookSsab Ab BB- M. Rosendal / L. Landeman UNDERWEIGHTSt1 Nordic Oy BB Stable J. Magnussen / L. LandemanStatkraft Sf A- Stable Aaa Stable J. Magnussen / L. Landeman OVERWEIGHTStatnett Sf A+ Stable Wr Stable J. Magnussen / L. Landeman MARKETWEIGHTStatoil Asa AA- Neg Aa2 J. Magnussen / L. Landeman UNDERWEIGHTSteen & Strom As BBB+ Stable O. Heldal / L. LandemanStena Ab BB Stable B2 Stable N. Ripa / B. Børsting UNDERWEIGHTStockmann Oyj Abp B+ Stable M. Rosendal / L. LandemanStolt-Nielsen Ltd BB+ Stable BB B.K. Røed / J. MeyerStora Enso Oyj BB Stable Ba2 Stable WD M. Rosendal / L. Landeman MARKETWEIGHTStorebrand Bank Asa BBB+ Stable BBB+ Neg Nr Stable L. Holm / K. JensenStorebrand Livsforsikring As BBB+ Stable Baa1 Stable L. Holm / K. JensenSunnfjord Energi As BBB- Stable BBB- J. Magnussen / L. LandemanSuomen Hypoteekkiyhdistys BBB Neg L. Holm / K. JensenSvensk Fastighetsfinansiering Ab BBB Stable Louis LandemanSvenska Cellulosa Ab Sca A- Stable Baa1 Stable M. Rosendal / B. Børsting OVERWEIGHTSvenska Handelsbanken Ab AA- Neg Aa2 Stable AA- Stable L. Holm / K. Jensen MARKETWEIGHTSwedavia Ab A- Stable G. Bergin / L. LandemanSwedbank Ab AA- Neg Aa3 Stable A+ Pos L. Holm / K. Jensen MARKETWEIGHTSwedish Match Ab BBB Stable Baa2 Stable B. Børsting / M. Rosendal MARKETWEIGHTSydbank A/S Baa1 Stable L. Holm / K. Jensen MARKETWEIGHTTallink Grupp As BB Stable BB- N. Ripa / J. MagnussenTdc A/S BBB- Stable Baa3 Stable BBB- Stable M. Rosendal / J. Magnussen MARKETWEIGHTTechnopolis Oyj BB+ Stable BB L. Landeman / E. HjalmarssonTeekay Lng Partners Lp BB Stable BB- Ø. MossigeTeekay Offshore Partners Lp BB- Stable B+ Ø. MossigeTele2 Ab BBB Stable M. Rosendal / J. MagnussenTelefonaktiebolaget Lm Ericsson BBB+ Stable Baa1 Stable BBB+ Stable M. Rosendal / J. Magnussen MARKETWEIGHTTelenor Asa A Stable A3 Stable M. Rosendal / J. Magnussen MARKETWEIGHTTeliasonera Ab A- Stable A3 Neg A- Stable M. Rosendal / J. Magnussen UNDERWEIGHTTeollisuuden Voima Oyj BBB- Neg Wr BBB Stable J. Magnussen / L. Landeman OVERWEIGHTThon Holding As BBB+ Stable O. Heldal / L. Landeman


34 34




Analyst(s)

Company Rating Outlook Sr. Unsec Rating Outlook Rating Outlook Rating OutlookTine Sa BBB+ Stable O. Heldal / L. LandemanUpm-Kymmene Oyj BB+ Stable Ba1 Stable WD M. Rosendal / L. Landeman MARKET WEIGHTVasakronan Ab A- Stable E. Hjalmarsson / L. LandemanVattenfall Ab BBB+ Neg A3 Neg BBB+ Stable J. Magnussen / L. Landeman MARKETWEIGHTVestas Wind Systems A/S BBB- N. Ripa / J. Magnussen OVERWEIGHTVictoria Park Ab BB- Stable B+ L. Landeman / E. HjalmarssonVolvo Ab BBB Stable Baa2 Stable BBB Stable M. Rosendal / B. Børsting MARKETWEIGHTWihlborgs Fastigheter Ab BB+ Stable BB L. Landeman / E. HjalmarssonWilh Wilhelmsen Asa BB+ Stable B.K. Røed / J. MeyerYit Oyj B Stable E. Hjalmarsson / L. Landeman


35 35

Fixed Income Credit Research team Thomas Hovard, Chief Analyst Head of Credit Research +45 45 12 85 05 [email protected]

Louis Landeman, Senior Analyst TMT, Industrials +46 8 568 80524 [email protected]

Mads Rosendal, Analyst Industrials, Pulp & Paper +45 45 14 88 79 [email protected]

Jakob Magnussen, Senior Analyst Utilities, Energy +45 45 12 85 03 [email protected]

Knut-Ivar Bakken, Senior Analyst Fish Farming +47 85 40 70 74 [email protected]

Katrine Jensen, Analyst Financials +45 45 12 80 56 [email protected]

Ola Heldal, Senior Analyst TMT +47 85 40 84 33 [email protected]

Sondre Dale Stormyr, Senior Analyst Offshore Rigs +47 85 40 70 70 [email protected]

Henrik René Andresen, Senior Analyst Credit Portfolios +45 45 13 33 27 [email protected]

Øyvind Mossige, Senior Analyst Oil Services +47 85 40 54 91 [email protected]

Emil Hjalmarsson, Analyst Real Estate, Construction +46 8 568 80634 [email protected]

Haseeb Syed

High Yield, Norway +47 85 40 54 19 [email protected]

Brian Børsting, Senior Analyst Industrials +45 45 12 85 19 [email protected]

Lars Holm, Senior Analyst Financials +45 45 12 80 41 [email protected]

Gabriel Bergin, Analyst Strategy, Industrials +46 8 568 80602 [email protected]

Niklas Ripa, Senior Analyst High Yield, Industrials +45 45 12 80 47 [email protected]

Bjørn Kristian Røed, Senior Analyst Shipping +47 85 40 70 72 [email protected]

Iver Christian Båtvik, Analyst Shipping +47 95 97 74 45 [email protected]






















36 36

Disclosures This research report has been prepared by Danske Bank Markets, a division of Danske Bank A/S ('Danske Bank'). The authors of this research report are Haseeb Syed and Katrine Jensen, Analyst.

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