EM CEEMEA CREDIT: Dubai Islamic Bank: FV $ 5Y SLB Sukuk
Nov-12 07:42
(DIBUH; A3/NR/A)
IPT T+120bp area FV T+94bp
- UAE’s Dubai Islamic Bank is in the market with a proposed $ 5Y SLB Sukuk. We sketch our FV considerations at z+115bp or T+94bp area.
- Among comparables, we look at recently issued L5Y SLB Sukuk for smaller, higher rated Emirates Islamic Bank (EIBUH; NR/NR/A+), EIBUH 4.54 Mar31 charting at z+114bp (launched mid Sep at T+95bp or z+130bp area).
- Elsewhere, we also look at the recently issued 5Y Sukuk deal for lower rated Sharjah Islamic Bank (SIB; Baa2/A-neg/BBB+), SIB 4.60 Nov30 charting at z+124bp (launched earlier this month at T+95bp or z+124bp area).
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EURIBOR: Some activity in the ESTR/Euribor spread
Oct-13 07:39
- Early flows in the Euribor strip is seen in the ERM6 but the volume is explained by the activity in the ESTR/ERM6 spread, these have traded in 50k Total at 13.25.
- It is worth noting that the September and the October high of 13.50 were the highest prints since early April.
GERMAN AUCTION PREVIEW: On offer tomorrow
Oct-13 07:31
Germany has announced a 2.00% coupon for the new Dec-27 Schatz which will be on auction tomorrow. Germany is planning to auction E5.5bln of the line.
UK FISCAL: Weekend roundup of Budget press stories
Oct-13 07:27
- Bridget Phillipson, the Education Secretary who is running for Labour Deputy Leader, said on Sky News in an interview over the weekend that she was "confident that we as a Government will do the right thing by children growing up in poverty in our country." She followed by saying that "There's an urgency to this. With every year that passes more children are moving to poverty because of the two-child limit." Note that this policy is expected to cost more than GBP3bln and is not included in most estimates of the fiscal shortfall of around GBP30bln that Chancellor Reeves is expected to be needing to raise in the 26 November Budget.
- There were also a number of reports that Reeves is looking to increase fiscal headroom above the c. GBP10bln seen in the last two fiscal events. The Guardian is reporting a Treasury source stating "We would like more headroom. We want to try to insulate ourselves better against the volatility in the bond markets." More headroom is something that the MNI Markets team has been advocating for some time. If headroom is not sufficient then even small economic disappointments can lead to concerns that taxes will need to increase further down the line which creates uncertainty for both consumers and businesses (potentially delaying investment).
- There are reports that the Treasury is considering responding to farmers' concerns through a proposal put forward by CenTax over the inheritance tax reforms. At present the reforms are due to kick in at 20% after the first GBP1mln (half the normal 40%) but the report notes that thresholds of between GBP1.5-5.0mln may be considered with the standard 40% tax rate applicable after that. This would undoubtedly be a popular policy in rural communities.
- There are lots of opinion pieces on how stamp duty and council tax could be reformed (with the former particularly in focus after Badenoch stated that the Conservatives would abolish it). But at present it is unclear whether any reforms to either of these taxes are seriously under consideration.
- Furthermore, see our bullet earlier on the IFS options for the budget (7:45BST).
