5bp

UPDATE 5-BP gets $4 bln from Anadarko for oil spill costs


* BP shares jump 2.2 pct; Anadarko up 3.8 pctBy Tom BerginLONDON, Oct 17 (Reuters) - Anadarko Petroleum Corp will pay BP Plc $4 billion toward clean-up of the Gulf of Mexico oil spill, far less than BP might have won in court, but the deal could reduce the overall cost of the disaster for the British group.Under the settlement announced on Monday, Anadarko said it will no longer pursue its allegations of gross negligence against BP. Anadarko was a 25 percent partner in the doomed Macondo well, and BP had sought payments to offset the costs of the spill.BP shares rose 2.2 percent in London on news of the settlement. Anadarko shares were up 3.8 percent to $73.27 in afternoon trading on the New York Stock Exchange.“We regard it as favourable for both companies,” BP Chief Executive Bob Dudley told reporters.Anadarko could have been on the hook for 25 percent of the cleanup costs, compensating those affected, and paying any government fines. It could only avoid this responsibility if it proved that BP had been grossly negligent – something which could, potentially, have added around $18 billion to the total amount of fines BP faced.Anadarko would still be liable under the deal with BP for any fines payable to the U.S. government.Fines for leaking oil into U.S waters are assessed at a level of $1,100 per barrel, or $4,300 if gross negligence is proven. The government has said the Macondo well leaked almost 5 million barrels into the sea.BP has said the total bill for the oil spill, including government fines, will be $42 billion. This suggests Anadarko could have faced a total bill well above the $4 billion it agreed to pay.LESS LIKELYInvestors have priced in a final cost to the company from the spill that is far above BP’s estimate. Analysts say deals such as the one announced Monday make the worst-case scenario – a final bill in excess of $70 billion – look less likely.“We maintain our view that the ultimate cost to BP could fall … substantially below the cost inferred by the share price fall since the accident,” said Richard Griffith, an oil analyst at Evolution Securities.In May, BP agreed to accept $1.1 billion from the third partner in Macondo, Mitsui & Co , to cover its 10 percent share of cleanup costs.BP’s lawsuits against companies it hired for the failed drilling project are among the hundreds of claims still pending before a federal judge in New Orleans. A trial date has been set for February next year.To share the cost of the spill and cleanup, BP sued Transocean , owner and operator of the sunken Deepwater Horizon rig, cement specialist Halliburton , and Cameron International Corp , which designed the blowout preventer, a device that was supposed to stop the surge of oil.Key to forcing Transocean to meet the cleanup bill – BP has sought the full amount from the drilling contractor – is convincing a court that Transocean was grossly negligent.If BP does recoup cash from Transocean or Halliburton, it will pay a portion of this – up to $1 billion to Anadarko under the terms of the deal.Two lengthy government inquiries have laid the lion’s share of the blame for the blowout at BP’s door.The rig blast killed 11 men and caused more than 4 million barrels of oil from the Macondo well to spill into the sea.The case is In re: Oil Spill by the Oil Rig “Deepwater Horizon”, U.S. District Court, Eastern District of Louisiana, No. 2:10-md-02179.


3

It finally came! The wait is over!

Actually it came last week but then Easter happened and you know..

But man I’m so excited to play this! It’s been hard to stay away from game exclusive spoiler but now I can finally take Stein;Gate off of tumblr saviour! Hopefully this will tide me over until chaos;child.

Also Sam you need to play/watch this asap. That’s an order. 

LATAM WRAP-Peru defies sour mood on EM commodity names

By Paul Kilby

NEW YORK, Aug 18 (IFR) - Peru raised US$1.25bn in the bond market on Tuesday, breaking a month-long issuance lull in Latin America and defying negative sentiment about the region’s commodity exporters.

Many commodity credits struggled on a day that started out with an overhang from China, where stocks suffered another sharp sell-off overnight.

Bonds issued by Brazilian oil company Petrobras and iron ore producer Vale were both about 10bp wider on Tuesday, with the former’ s 2024s being spotted at 570bp-560bp.

In Chile, however, Codelco proved to be the exception. The copper company’s 2044s widened another 5bp to hit 252bp-248p, although the country’s credits on the whole were well bid.

“We are finding increased opportunities in EM, (and) every day we come in and there are more opportunities,” said Ricardo Adrogue, head of emerging markets debt at Babson Capital

Peru launched a new US$1.25bn 12-year bond at 195bp over US Treasuries, at the tight end of guidance of 200bp (+/-5bp) and well inside initial price thoughts of 225bp area.

The final spread level left some accounts cold, as they sought a higher premium to buffer against the possibility of slower growth in China and further declines in commodity prices.

But the Andean nation was still seen offering a relatively decent premium to its existing 2025s, which were trading at a G-spread of around 158bp-162bp.

The trade also came about 20bp-25bp over the 170bp-175bp fair value level that one banker was calculating for a new 12-year.

Given the high dollar price on the country’s existing bonds, accounts should have also liked the upside potential on a new bond issued closer to par.

Peru is also seen having some of the strongest fundamentals in Latin America, a region whose economies are suffering from sub-par growth. Pricing was expected later in the day through global coordinators Citigroup and JP Morgan.

(Reporting by Paul Kilby; Editing by Marc Carnegie)

UK EVENT: Carroll Thompson presents Back 2 Da Future Anniversary Showcase on Thursday 27th August at The Maze Inn (7 Chase Side, Southgate, N14 5BP - Piccadilly Line: Southgate)
7.30pm till midnight with resident DJs Mr Prezedent @prezzyb2f & Roy Medallion

Forex Exchange Morning Report

Market wire
A reversion in risk sentiment during the London morning resulted avant-garde a weak finish to the week, despite decent US info. Strong GDP data from the Eurozone core and Hong Kong initially supported investor appetite, again then nervousness ahead of the weekend seemed to take from hold, possibly influenced by supplemental retention headlines regarding New world. The EU warned wrong levels for Greece, Ireland and Portugal would subsist larger than beforehand arrange, the IMF head was arrested onwards charges relating in passage to a innermost subplot. The S&P500 unvented 0.8% lower, but commodities were breezy, the CRB index accommodation unchanged (laurel butter +0.7%, copper +0.4%, gold +0.1%, silver +2.0%). US 10yr serve yields closed 5bp furrow at 3.17%, having dipped until 3,13% as risk malevolence took hold.

The US dollar index ended the week on a strong note, en route to unto early April levels. EUR fell from an early London 1.4340 up to 0.7836, where it has opened this morning. The ECB oversee verbal inflation had probably peaked, implying tightening may be less aggressive than expected. Typical of a risk averse vesper, the yen outperformed all, USD\JPY rising ex 80.34 to 80.92. AUD peaked at 1.0717 early London and fell to a multi-week low of 1.0521. Not an illusion is currently around 1.0550. NZD under-performed most, falling from 0.7966 to 0.7836 where it trades this morning. AUD\NZD ranged between 1.3400 and 1.3500

Mercantile pen
US CPI rose 0.4% in April while the core property tax rose 0.2%, both in line in company with expectations. The annual make a hit rate is now dilate at 3.2% with food and energy prices ancient to push inflation higher. The core rate edged aspire in 1.3% in the session to April, at rest masterfully below the Fed’s preferred rate of around 2%. Within the core rate, sleeper prices (both new and old) were jump sharply yet again but owners’ reserve lacerate remained steady at 0.1% in re the month

US University of Michigan confidence rose to 72.4 from 69.8 in the preliminary perishing in aid of May. Grease prices about yean a fairly big impact on this survey and the rise likely reflects the sell-off way in commodities witnessed so far this month. The cheap conditions component softened to 80.2 from 82.5 but the outlook improved over against 67.4 from 61.6. One-year ahead inflation expectations softened a pattern to 4.4% leaving out 4.6%.

Eurozone GDP surprised until the upside not to mention the advance Q1 hosanna revealing growth in respect to 0.8% over the bissextile year. Benign tumor continues toward be driven by the core, especially Germany which registered voluminous growth of 1.5% on the quarter while France also posted a robust 1.0% en route to the quarter. Interestingly for Germany, net trade contributed vulgar than domestic must item over against overall downturn

Record more at http:\sevensummitstrader.info\

Market light
AUD\USD and NZD\USD outlook afterward 24 hours: AUD’s 1.0550 undeviating anvil looks vulnerable, any corrective pertness little until the 1.0700 corridor. NZD should test 0.7820 support, a break then pointing to 0.7730. There is in the shade data (home loan and car sales) from Australia, but tonight’s forensic on the Canadian economy not counting BOC head Carney should provide policy clues there.

Con more at http:\theportfolioprophet.info\

US IG CLOSE-Seven high-grade issuers raise US$5.7bn

By John Balassi

NEW YORK, Aug 17 (IFR) - Below is a recap of primary issuance activity in the US high-grade market on Monday:

Number of deals priced: 7

Total (Swiss: FP.SW - news) issuance volume: US$5.7bn

Average new issue concession: 20.5bp

Average book to cover: 1.96

DEUTSCHE BANK (Other OTC: DBAGF - news)

Deutsche Bank AG (DB), A3/BBB+/A, announced a US$ benchmark SEC (Shanghai: 603988.SS - news) registered 2-part senior unsecured note offering that includes a 5-year (8/20/20) fixed and/or FRN. The sole bookrunner is DB. Use of Proceeds: General Corporate Purpose. Settlement T+3 (Aug 20, 2015).

IPTs: 5yr FXD T+mid 150s, 5yr FRN Libor equiv

PRICE GUIDANCE: 5yr FXD T+145bp area (+/- 2bp), 5yr FRN Libor equiv

LAUNCH: US$1.25bn 2-part. US$1bn 5yr FXD at T+143bp, US$250m 5yr FRN at 3mL+131bp.

PRICED: US$1.25bn 2-part total.

- US$1bn 2.95% cpn 5yr (8/20/20) FXD. At 99.829. T+143bp

- US$250m 5yr (8/20/20) FRN. At 100, floats at 3mL+131bp.

BOOK: US$2.25bn

NIC (NasdaqGS: EGOV - news) : 5-year fixed: 14bp-19bp (10bp-15bp for curve extension added to 2019s for FV: 124bp-129bp)

COMPS:

2.5% Feb 13 2019 at G+114bp

3.7% May 30 2024 at G+166bp

ABBEY NATIONAL TREASURY SERVICES

Abbey National Treasury Services plc (ABBEY (LSE: ABBY.L - news) ), A2/A/A, announced a US$ benchmark SEC registered 2-part senior unsecured note offering that includes a 3-year fixed and/or FRN. The active bookrunners include BAML, GS, Sant and WFC. The notes are guaranteed by Santander UK plc (LSE: 44RS.L - news) . UOP: GCP. Settle: T+5.

IPTs: 3yr FXD T+110bp area, 3yr FRN Libor equiv

PRICE GUIDANCE: 3yr FXD T+105bp (#), 3yr FRN Libor equiv

LAUNCH: US$1bn 2-part. US$750m 3yr FXD at T+105bp, US$250m 3yr FRN at 3mL+85bp

PRICED: US$1bn 2-part total. US$750m 2.0% cpn 3yr (8/24/18) FXD. At 99.708, yld 2.101%. T+105bp. US$250m 3yr (8/24/18) FRN. At 100, floats at 3mL+85bp

BOOK: US$1.5bn

NIC: 3-year fxd: 5bp (vs Lloyds 2018s)

COMPS:

Abbey 1.65% 2017 at G+85bp

Abbey 2.35% 2019 at G+90bp

Lloyds (A1/A/A) 2.0% 2018 at G+100bp

STANLN (Aa3/A-/AA-) 2.4% 2019 at G+97bp

RYDER SYSTEM INC (NYSE: R - news)

Ryder System Inc ®, Baa1/BBB/A-, announced a US$300m (no grow) SEC registered 5-year (9/01/20) senior unsecured notes. The active bookrunners include BAML, BNP (Paris: FR0000131104 - news) , Miz, MS, and RBC (Other OTC: RBCI - news) . Optional Redemption: Make Whole Call, and Par Call: 1 month(s) prior to maturity. Use of Proceeds: General Corporate Purposes. Settlement T+5.

IPTs: T+150bp area

PRICE GUIDANCE: T+140bp area (+/- 5bp)

LAUNCH: US$300m at T+135bp

PRICED: US$300m 2.875% cpn 5-yr (9/01/20). At 99.888, yld 2.899%. T+135bp.

BOOK: US$650m

NIC: 5-yr 14bp

COMPS:

2.5% May 2020 at G+121bp

PLAINS ALL AMERICAN PIPELINE

Plains All American Pipeline L.P. (PAA), Baa2/BBB+, announced a US$ benchmark 10-year (10/15/25) senior notes. The active bookrunners include Citi, Miz, MUFG and UBS (NYSEArca: FBGX - news) . The notes contain a MWC and 3mo par call. UOP: GCP. Settle: T+5.

IPTs: T+262.5bp area

PRICE GUIDANCE: T+250bp (the #)

LAUNCH: US$1bn at T+250bp

PRICED: US$1bn 4.65% cpn 10yr (10/15/25). At 99.846, yld 4.668%. T+250bp. MWC+37.5bp

BOOK: US$1.75bn

NIC: 10-year: 23bp (add 5bp to 2024s for curve extension for FV: 227bp)

COMPS:

2.6% 2019 at T+141bp, G+157bp

3.6% 2024 at T+216bp, G+222bp

4.9% 2045 at T+262bp

EPD (Baa1/BBB+/BBB+) 2.55% 2019 at G+134bp

EPD 3.7% 2026 at G+211

EPD 4.9% 2046 at T+253bp

Spectra (Baa2/BBB/BBB) 3.5% 2025 at G+210bp

Spectra (Other OTC: SPKTF - news) 4.5% 2045 at T+249bp

XEROX CORP (Swiss: XRX.SW - news)

Xerox Corp (XRX), Baa2/BBB/BBB, announced a US$400m (no grow) SEC registered 5-year (8/20/20) senior notes. The active bookrunners include BNP, Citi, CS, and UBS. Co-mgrs:BAML, JPM, GS, MIZ, MS. Op. Redempt: Make whole call. UOP: General corporate purposes which may include repayment of a portion of outstanding borrowings. Settle: T+3 (8/20/2015)

IPTs: T+187.5bp area

LAUNCH: US$400m at T+212.5bp

PRICED: US$400m 3.5% cpn 5yr (8/20/20). At 99.113, yld 3.696%. T+212.5bp.

BOOK: US$635m

NIC: 5-year 50-55bp

COMPS:

2.75% Sept 2020 at G+153bp

FIFTH THIRD BANK

Fifth Third Bank (FITB), A3/A-/A, announced a US$ benchmark 3-year fixed and/or FRN bank notes. DB, GS, FITB, and JPM are the active bookrunners. UOP: GCP. Pricing expected today.

IPTs: 3yr FXD T+120-125bp, 3yr FRN Libor equiv

PRICE GUIDANCE: 3yr FXD T+115bp area (+/- 5bp), 3yr FRN Libor equiv

LAUNCH: US$1.25bn 2-part. US$1bn 3yr FXD at T+110bp, US$250m 3yr FRN at 3mL+91bp

PRICED: US$1.25bn 2-part total. US$1bn 3yr 2.15% cpn FXD (8/20/18). At 99.983, yld 2.156%. T+110bp. US$250m 3yr FRN (8/20/18). At 100, floats at 3mL+91bp

BOOK: 3yr FXD US$1.85bn, 3yr FRN US$300m

NIC: 3yr FXD 10bp. (curve from 2017s to 2018s about 25bp so FV: T+100bp)

COMPS:

1.35% June 1, 2017 at G+75bp

2.375% April 25, 2019 at G+123bp

2.875% October 1, 2021

HUNTINGTON NATIONAL BANK

Huntington National Bank (HBAN), A3/BBB+/A-, announced a US$500m 3(a)2 exempt 5-year (8/20/20) senior bank notes. The active bookrunners include DB, GS and HIC. Optional redemption: Par call 1mo prior to maturity. UOP: General Corporate Purposes. Pricing expected today. Settle: T+3 (08/20/2015).

IPTs: T+140-145bp

PRICE GUIDANCE: T+140bp (the #)

LAUNCH: US$500m at T+140m

PRICED: US$500m 2.875% cpn 5yr (8/20/20). At 99.58, yld 2.966%. T+140bp.

BOOK: US$720m

NIC: 5yr 20-25bp

COMPS:

2.4% April, 1 2020 G+114bp

(Reporting by John Balassi; Editing by Varghese Joseph)

High-grade CDS index widens amid rout

(Updates throughout)

By Davide Scigliuzzo and Paul Kilby

NEW YORK, Aug 24 (IFR) - The credit default swap index tracking investment-grade US corporate bonds hit two-year wides on Monday amid a rout in equities, commodities and the US dollar.

The carnage also hit the cash markets in fixed income, where the most liquid bonds were quoted some 5bp-6bp wider after a plunge in Chinese stocks sparked a worldwide sell-off.

The spread on the investment-grade CDX index gapped out as much as 7.3bp, or 8.8%, to 89.96bp-91.09bp before pulling back to 85.36bp-86.27bp in mid-morning, according to Markit data.

That was still a two-year wide, and came as the primary market ground to a halt in the last week of business for August.

Little had been expected in the way of new bond issuance this week, however, and some analysts said there was no real sense of panic.

“It doesn’t feel like a fire sale,” Matthew Duch, a fixed-income portfolio manager at Calvert Investments, told IFR.

“Guys are backing away and waiting for greater clarity.”

Another investor, who noted that the sell-off was offering some good opportunities to buy, said recent issues were getting hit particularly hard.

“Names that are very solid credits are going to be fine, but they get knocked out by the market,” the investor said. “New issues get knocked out even more because they are more liquid.”

Duch meanwhile said there was concern that an uptick in redemptions from retail investors could exacerbate the sell-off and force portfolio managers to sell.

“Institutional investors can sit tight or put cash to work, but on the retail side you have to manage flows,” he said.

“If you have to meet redemptions, you don’t have the luxury to sit tight.” (Reporting by Davide Scigliuzzo and Paul Kilby; Editing by Marc Carnegie)