Security Fears Cause Aircraft Spreads To Widen

The price of protection on companies linked with air travel jumped last week after a British Airways flight to Washington was grounded because of fears it was being targeted by terrorists.

  • 11 Jan 2004
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The price of protection on companies linked with air travel jumped last week after a British Airways flight to Washington was grounded because of fears it was being targeted by terrorists. Credit-default swap spreads on British Airways widened by around 15 basis points to 275bps. By Wednesday, however, spreads had tightened to 260bps again, driven by the release of data showing December passenger numbers were better than expected. Spreads on Lufthansa and SAS also widened.

Suppliers to the carriers were also hit. For example, five-year spreads on Rolls-Royce, an engine manufacturer, jumped 10 basis points last week to 56bps on Wednesday. "If anything, the name is more liquid now there's been more trading," said one London-based credit-default swap trader.

Tassos Philippakos, an analyst at Moody's Investors Service, said, "Moody's believes that the downcycle in the civil aerospace market will last through the year." In addition, the weak dollar has hurt Rolls-Royce because most of its sales are dollar denominated but it has European and U.K.-based operations and costs.

Myriam Durond, a Moody's analyst covering British Airways, said the outlook for the carrier is negative because of uncertainties over passenger volumes and a weak near-term operating performance. A recent Moody's reported said a terrorist attack could push the rating down.

Five-Year Protection On Rhodia

  • 11 Jan 2004

All International Bonds

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • 16 Jan 2017
1 Citi 22,118.13 61 9.00%
2 Barclays 20,987.41 55 8.54%
3 JPMorgan 17,406.75 53 7.08%
4 HSBC 16,333.52 48 6.64%
5 Goldman Sachs 15,454.74 49 6.29%

Bookrunners of All Syndicated Loans EMEA

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • 10 Jan 2017
1 BNP Paribas 43,328.12 198 6.63%
2 JPMorgan 42,145.56 84 6.45%
3 HSBC 38,419.93 154 5.88%
4 UniCredit 37,616.85 180 5.75%
5 ING 30,163.46 163 4.61%

Bookrunners of all EMEA ECM Issuance

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • 10 Jan 2017
1 Emirates NBD PJSC 408.38 1 31.73%
2 SG Corporate & Investment Banking 166.67 1 12.95%
2 JPMorgan 166.67 1 12.95%
2 Credit Agricole CIB 166.67 1 12.95%
5 Morgan Stanley 59.80 1 4.65%