06 August 2018 by jbchevrel
CMZBSUB (-16) was the best performer in the iTraxx SubFin index today, after the #2 German bank was upgraded to A1 and its T2s were upgraded to Baa3 by Moody’s. Now T2s are IG-rated by all the three main agencies. Cash subordinated bonds climbed to the highest in 18M+ and the stock was in green territory despite SX7E being -0.3% lower. This year, CMZB (+26 YTD) has been among outperformers in iTraxx SnrFin index (+35 YTD), notably tighter vs its rival DB (+70 YTD). That trend may well continue, as DB was downgraded to Baa3 in the same time. Elsewhere, HSBC results had little impact on credit, and the Italian complex stabilized in line with the BTP/Bund spread.