Crédit Agricole S.A. - CASHA

Hi

Anybody concerned about the Credit Agricole bonds - CASHA now selling at 87% of par. The market seems to be discounting them for fear over their Greek exposure

Any comments or views on how the Greek/Euro situation could/will impact them. CA look to have significant Greek exposure through their investment in Emporiki Bank

I think the market has been discounting them for a while because they're perpetual and the interest rate reset doesn't look great.

Thanks for your reply Snapper, but look at these two bonds

ANBHA – ANZ Bank
Perpetual, unsecured, deeply subordinated bonds
Credit Rating A+
Current Coupon Rate 9.66%
Reset Date 18 April 2013
On the 18th of April 2013, if not called, the coupon rate will be reset for a further 5 years at the then 5yr swap rate plus the issue margin of 2.00%
Current reset if done today – 4.35+2.00 = 6.35%
Current price: 107

CASHA – Credit Agricole
Perpetual, unsecured, deeply subordinated notes
Credit Rating A
Current Coupon Rate 10.035%
Reset Date 19 December 2012
On the 19 December 2012, the coupon rate will be reset for a further 5 years, until 19 December 2017, at the then 5 year swap rate plus the Issue Margin of 1.90%
Current reset if done today – 4.35+1.90 = 6.25%
Current price: 86

Both Perpetual, unsecured, deeply subordinated notes, one with A rating and 10.04%, the other with A+ and 9.66%, resets within 4 months of each other and reset 0.10% different
People are much more trusting of ANZ than CA – I would say one is overvalued and the other undervalued

Comments?

DISC – I hold both

Quote:

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Originally Posted by D B Cooper

Thanks for your reply Snapper, but look at these two bonds

ANBHA – ANZ Bank
Perpetual, unsecured, deeply subordinated bonds
Credit Rating A+
Current Coupon Rate 9.66%
Reset Date 18 April 2013
On the 18th of April 2013, if not called, the coupon rate will be reset for a further 5 years at the then 5yr swap rate plus the issue margin of 2.00%
Current reset if done today – 4.35+2.00 = 6.35%
Current price: 107

CASHA – Credit Agricole
Perpetual, unsecured, deeply subordinated notes
Credit Rating A
Current Coupon Rate 10.035%
Reset Date 19 December 2012
On the 19 December 2012, the coupon rate will be reset for a further 5 years, until 19 December 2017, at the then 5 year swap rate plus the Issue Margin of 1.90%
Current reset if done today – 4.35+1.90 = 6.25%
Current price: 86

Both Perpetual, unsecured, deeply subordinated notes, one with A rating and 10.04%, the other with A+ and 9.66%, resets within 4 months of each other and reset 0.10% different
People are much more trusting of ANZ than CA – I would say one is overvalued and the other undervalued

Comments?

DISC – I hold both

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A few days ago Moodys downgraded Credit Agricole's credit rating because it has a lot of loans in Greece. Market is usually right! CASHA is not as safe as before.

Greece vote:

"Numbers now out. Papandreou wins the confidence of the government. 155 MPs voted yes, four more than the 151 the prime minister needed - a majority in the 300-seat parliament."

CASHA price should have reached the bottom. I would be surprise if the price recovers a few cents this week.

HY Results announced

Net income of Credit Agricole S.A. in Q2 was 339 m Euro, much better than analysts forecasted (187 m Euro). Share price increased by 5%.

At 10% interest rate, CASHA looks cheap at 60 cents (comparing with 60 cents of IFTHA paying 5% interest). It's hard to believe Infratil would be more reliable than Credit Agricole S.A. (a major bank in France) in terms of revenue and profit.

I'd rather have IFTHA myself..also upside of probable swap rate increase in future . The Euro looks like its in difficulties....so Infratil may be more reliable.

QUOTE=Newman;355436]HY Results announced

Net income of Credit Agricole S.A. in Q2 was 339 m Euro, much better than analysts forecasted (187 m Euro). Share price increased by 5%.

At 10% interest rate, CASHA looks cheap at 60 cents (comparing with 60 cents of IFTHA paying 5% interest). It's hard to believe Infratil would be more reliable than Credit Agricole S.A. (a major bank in France) in terms of revenue and profit.[/QUOTE]

Quote:

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Originally Posted by Newman

HY Results announced

It's hard to believe Infratil would be more reliable than Credit Agricole S.A. (a major bank in France) in terms of revenue and profit.

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I understand that Credit Agricole S A is one of the European institutions that lent large to Greece. I do not know if CASHA's are ring fenced from this turmoil.

Boop boop de do

Marilyn

Quote:

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Originally Posted by Marilyn Munroe

I understand that Credit Agricole S A is one of the European institutions that lent large to Greece. I do not know if CASHA's are ring fenced from this turmoil.

Boop boop de do

Marilyn

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Loss in Greece was written off. Core Tier 1 ratio increased to 8.9%. In comparison ANZ is going to sell another hybrid notes, convertable to ordinary shares when Tier 1 ratio drops to below 6%.

CASHA is traded 68 cents today.

What are the eqivalents of CASHA worthing?

If you go to Luxembourg Stock Exchange: http://www.bourse.lu/Accueil.jsp#
and type "credit agricole" in the Name box to search bonds and notes issued by Credit Agricole you would find a list of 3 pages. I checked 8 of the bonds/notes that Credit Agricole partially bought back on February 2012 and found that their trading price in the past year varied from 37-52 (cents per dollar) for FR0010161026 to 65-83 for FR0010814418. Also of interest is that CAD notes (FR0010359794) are due for interest payment on 11 August 2012.

If Credit Agricole pays interest to CAD Notes it would have to pay CASHA note-holders interest in mid-September. Am I right?

What stops Credit Agricole buying back CASHA notes?

Any interest in analysing CASHA?

I found that interest payment to CASHA note holders would be made on September 19.

The HY financial review released to NZX this morning shows (on page 100) that Credit Agricole S.A. have 7.377 billion euros of deeply subordinated notes (on June 30) which include NZ$250m CASHA notes. I have NOT found any announcement that interest payment to these 7.377 billion notes would be suspended.

I think some analysts worried about interest suspension or haircut (to notes) too much and too earlier.

CASHA is traded at 44 cents today, much lower than the price for similar notes on European markets.

The price of CASHA notes jumped from $0.43 on Monday to $0.50 now.

Not really into Credite Agricole.. Just spotted this thread in passing.. I do know that they are in a little bit of trouble...

Check out Credite Agricole and Emporiki Bank.. !!..

Looser Basel rules boost European banks
http://www.ft.com/cms/s/0/405d4be6-5...#axzz2HKS2H3ac

CASHA becomes much safer than a few months ago. At the interest rate of 5.04% p.a. and current price of 54 cents for a dollar, the annual return (5.04/0.54 = 9.33%) seems attractive and potential to get back $1/bond in 2017 is even more attractive.

CASHA now is 59 cents/bond

I'm tempted to sell the clip I picked up in December. I suppose at 59 they are still yielding over 8.5% for investment grade paper. And the bank's senior issues are still rated A by S&P. Probably about a fair price for them given the subordination. May turn out to be cheap if they all them l at 60c+ soon... they seem to have done this in other cases recently.

Quote:

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Originally Posted by Penfold

I'm tempted to sell the clip I picked up in December. I suppose at 59 they are still yielding over 8.5% for investment grade paper. And the bank's senior issues are still rated A by S&P. Probably about a fair price for them given the subordination. May turn out to be cheap if they all them l at 60c+ soon... they seem to have done this in other cases recently.

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Equivalents of CASHA were recently traded at much higher prices in Europe. For example, FR0000475790 at 0.82, FR0010291997 at 0.83, and FR0010248641 at 0.92.

If you bought CASHA in December, you have already gained 10% in a month.

I compares CASHA with IFTHA. They are traded at similar prices. IFTHA, I think, is not rated, and pays an interest of 3.97% pa.

I would think on long-term Credit Agricole would be more reliable than Infratil. It is difficult to imagine Credit Agricole would collapse in 5 years.

CASHA rose to 62 cents. Too good to believe. Sold out my holdings.

Wish I had been more patient. Sold at 58... I am a bit surprised to be honest it has risen so much. This is Junior Sub-debt in a European Bank.

Nicely played Newman... 62 looks to be a great price.

Share price of Credit Agricole S.A. could be found by clicking the link below:

http://uk.finance.yahoo.com/q?s=ACA.PA

I note that Credit Agricole has come to the party on Credit Sails offering an allmost complete compensation to investors. Although the issue was $90M Calyon owned about one third of the credit sails anyway hence the compnesation sizing at $60M.

CASHA are more subordianted that ANBHA

CASHA has climbed unbelievably fast in the last few days while the share price of Credit Agricole S.A. went down 5%.

When Credit Agricole releases it annual accounts on Feb. 21 I guess the market would react with a negative correction because the data released so far suggest a big loss in Q4. Recent headlines on Credit Agricole were not so bright: For example:

PARIS, Jan 30 (Reuters) - The heads of France's top three banks said tougher laws to curb risky trading would put the country at a competitive disadvantage as it struggles with record unemployment and a grim economic outlook.

PARIS—Credit Agricole SA ACA.FR said Friday its fourth-quarter results would be hit by a €160 million ($214 million) accounting charge after the group of regional lenders that own a controlling stake in the bank's parent company revalued their holdings.

Crédit Agricole Hit by $3.6 Billion Charge

The Wall Street Journal

1 Feb 2013
By NADYA MASIDLOVER
PARIS—French bank Crédit Agricole SA said Friday that its fourth-quarter results will be hit by goodwill impairment charges totaling €2.68 billion ($3.64 billion), citing tighter regulatory requirements and the current financial environment.

The charges come in addition to impairments already announced last week, when the bank said net profit would be negatively impacted by €160 million due to a €651 million impairment charge at the regional banks level following a change in accounting methods.

The net impairment charge won't affect its solvency or liquidity as goodwill is already fully deducted during the calculation of solvency ratios, Crédit Agricole said in a statement.

Goodwill is an intangible asset created when companies capitalize the premium they pay in acquisitions. When acquisitions don't pan out, companies have to recognize the difference by writing down the value of the goodwill. They are often slow to do so, partly because valuing assets accurately is difficult.

The bank also said other negative nonoperating items will be recorded, including an impact on revenues of about €850 million on the revaluation of its own debt due to the improvement of funding conditions during the quarter and a tax expense of around €130 million related to an exceptional 7% tax on the capitalization reserve of the group's insurance companies.

Last night the share price of Credit Agricole SA was down 5.42% to 7.12 Euros.

The share price of Credit Agricole nosedived to 6.18 Euros after Cyprus agreed to a deal that qualifies the eurozone member for a bailout -- but only after a radical downsizing of the island's financial sector.
"Eurogroup head Jeroen Dijsssebloem told the Financial Times and Reuters the hard-won agreement to liquidate a major Cypriot lender could become a model for other troubled corners of the eurozone".

Further, Moody's Investors Service on Monday said it still viewed the outlook for France's top four banks as negative, citing their continued reliance on wholesale funding.

The risks associated with CASHA deeply subordinated notes seems greater now than 3 months ago. If bank deposit could be taken to solve financial troubles what else is safe? If Credit Agricole decides not to redeem the notes on 19 December 2018 noteholders would be paid 3-month interest rate plus a margin of 1.9% at best, a bad situation for bondholders. The annual report of Credit Agricole leased to NZX yesterday shows that at least two deeply subordinated notes have not been redeemded after their first call dates.

French banks started reporting Q2 results.
-------------------------------------------------------------
Market volatility in Asia helped BNP Paribas boost its trading business in the second quarter as the French bank's profits bounced back from a multibillion fine in the same period last year.

Net profits were €2.56bn in the three months ended June 30, rebounding from a €4.22bn loss a year earlier on the back of a $8.9bn fine for violating US sanctions against Sudan, Iran and Cuba writes the FT's Michael Stothard in Paris.

Crédit Agricole SA publishes its results on Aug. 4.
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At the current price of $0.76, CASHA provides a return of 6.63%. This is better than the yield of most local bonds, with the potential of big capital gain if CASHA bonds are redeemed in Dec 2017.

Second quarter and first half 2015 results

Paris, 04 august 2015
http://www.credit-agricole.com/en/In...f-2015-results


Strong commercial performance in all business lines
Solid results in a still challenging economic context
Strength of financial structure confirmed

Crédit Agricole Group*
Q2-15 Net income Group share: 1,500 million euros (vs. 785 million euros in Q2-14)
H1-15 Net income Group share: 2,728 million euros (vs. 2,037 million euros in H1-14)
Fully-loaded CET 1 ratio: 13.2% (+90 bp/June 14)
*Crédit Agricole S.A. and Regional Banks at 100%

Crédit Agricole S.A.
Revenues from business lines: +5.7%* Q2/Q2
GOI of business lines: +6.8%* Q2/Q2
Cost of risk of business lines: -27.6%* Q2/Q2
Impact of specific items
- Triggering of the Switch: +80 million euros in NIGS
- Additional provisions for litigation: -350 million euros
- Issuer spread/DVA/CPM: +200 million euros in NIGS
Net income Group share: 920 million euros
Underlying net income Group share: 982 million euros
Fully-loaded CET 1 ratio: 10.2% (+30 bp/June 14)

This could be linked to the share price drop of Credit Agricole S.A. on Tuesday

Crédit Agricole restructuring plan hits a hurdle

Published: Aug 4, 2015 7:51 a.m. ET


By
NOEMIE
BISSERBE
PARIS-- Crédit Agricole SA said Tuesday that plans to revise its complex structure have hit a hurdle as it has yet to agree terms with European regulators, sending its shares sharply lower.

The French bank had been working on a plan for over a year to simplify its corporate structure--which has for a long time dragged on its valuation--in a bid to relieve tensions within the bank. Crédit Agricole is 56%-owned by the group's regional retail banks. In turn it controls 25% of these lenders--a structure analysts say is too complex.

"For such a plan to be implemented, certain restrictions would have to be lifted by regulators," said Chief Executive Philippe Brassac, without giving details.


Tuesday's announcement dashed investors' hopes of getting a special dividend following any major restructuring. A new structure could also have helped boost Crédit Agricole's capital cushions amid rising pressure from regulators who are still trying to fix the financial system following the crisis six years ago. The bank's core tier-one ratio, which compares top-quality capital such as equity and retained earnings with risk-weighted assets, was flat at 10.2% from March.

By midafternoon the bank's shares were down 11%.

"This new delay may put off some investors," says Nomura analyst Jon Peace.

While the bank didn't specify the European regulators' concerns, Deputy CEO Xavier Musca said:

"Regulators are not in a position to clearly answer some of our questions, as this would pre-empt a larger debate on harmonization in Europe."

The slump in the stock came after Crédit Agricole posted a sharp jump in second-quarter net profit, recovering from massive losses it made in Portugal last year.

The bank said net profit rose to EUR920 million ($1.01 billion) in the three months to the end of June, from EUR77 million a year earlier. In the same quarter last year, the crisis facing Portuguese lender Banco Espírito Santo SA, in which Crédit Agricole held a 14.6% stake, nearly wiped out the French bank's profit. Revenue was up 18% at EUR4.63 billion, lifted by its asset management, insurance and corporate and investment banking businesses.

Crédit Agricole booked a new provision of EUR350 million, as it nears an agreement with U.S. authorities to settle allegations of potential sanctions breaches, raising its total provisions to cover all potential litigation costs to about EUR1.6 billion.

The French bank is expected to reach a settlement in the next few months.

It remains unclear what fraction of this total provision the bank expects to pay to settle the sanctions probe. According to company filings, Crédit Agricole is also under investigation by U.S. authorities over its role in the alleged rigging of benchmark interest rates--the London interbank offered rate and the euro interbank offered rate.

Write to Noemie Bisserbe at noemie.bisserbe@wsj.com

Subscribe to WSJ: http://online.wsj.com?mod=djnwires

Credit Agricole S.A ("CAS") forgot sending to NZX its Preliminary Half Year Results for the period ending 30 June 2015. It showed no respect to NZ bond holders. Would anyone expect CAS redeems the $250m CASHA bonds in December 2017?

Exclusive: Credit Agricole may pay about $900 million in US sanctions probes
Reuters - ‎Sep 9, 2015‎
Last month, Credit Agricole said it was in "very advanced talks" with U.S. authorities over the sanctions probes and it expected to reach a global settlement in autumn. It set aside an additional 350 million euros ($392 million) for a settlement. In ...

Would cancellation of dividend follow? which could result in suspension of interest payment on CASHA 12 month later or even worse a haircut to the bonds if Credit Agricole runs into trouble in the coming years. Repayment of bonds in 2017 has never been mentioned.

Certainly not troubling buyers recently. Has really shot up. Wish I had more (at about 55cents average).

While the share price of Credit Agricole dived, CASHA bonds rocketed up. Hard to understand why buyers come in now. They may dream the bonds be redeemed before or on December 2017, which looks like an over-optimistic expectation.

Credit Agricole to pay $787 mln to resolve US sanctions probes ...
Reuters-
NEW YORK Oct 19 France's Credit Agricole SA has agreed to pay U.S. authorities $787 million to resolve accusations it illegally moved money ...

The price of these are up to 92c. That is a significant uplift over the past few months.

I wonder what is driving the price up:

• Confidence that Credit Agricole is on a stable footing? Lower chance of a haircut?
• Confidence that the bonds will be repaid next year? Given the interest rates in other parts of the world it may make sense for them to redeem bonds paying over 5%.

Probably all of those factors.

Lee Partners gave a heads-up on the situation a few weeks ago, so perhaps their clients are providing demand.

These types of hybrids are like chewing gum on the bedpost as well - they lose their flavour over time (i.e. authorities won't accept them as part of various equity calculations)

Whats are readers views on the Crédit Agricole S.A. Tender offer? does that mean NZD will follow? Thanks

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Originally Posted by Shane.trading

Whats are readers views on the Crédit Agricole S.A. Tender offer? does that mean NZD will follow? Thanks

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Rien {nothing} !

Non {no} !

https://www.youtube.com/watch?v=fFtGfyruroU

De rien
Tigre de Papier

You need to take into consideration of exchange rate, as well as interest rate, to guess what Credit Agricole would do in December 2017.
When it issued the notes in Dec 2007, NZ$1 = 0.5276 Euro, now the rate is about 0.68.
If you make a decision for the bank, what would you do?

Merci, Tigre, great post!

Merci (Thanks).

:cool:

Quote:

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Originally Posted by Newman

Credit Agricole S.A ("CAS") forgot sending to NZX its Preliminary Half Year Results for the period ending 30 June 2015. It showed no respect to NZ bond holders. Would anyone expect CAS redeems the $250m CASHA bonds in December 2017?

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Tomorrow we get paid out. This has been a good investment for me. Bought in at the beginning and averaged down along the way.
The question is now-where to reinvest the proceeds?