trending Market Intelligence /marketintelligence/en/news-insights/trending/ewf6zskdx9l0kiazv_wjqw2 content
Log in to other products

Login to Market Intelligence Platform


Looking for more?

Contact Us

Request a Demo

You're one step closer to unlocking our suite of comprehensive and robust tools.

Fill out the form so we can connect you to the right person.

  • First Name*
  • Last Name*
  • Business Email *
  • Phone *
  • Company Name *
  • City *

* Required

In this list

Kenya's Family Bank to shed jobs; Mozambican banks 'in good health'

Broadband Only Homes Skyrocket In 2018 Validating Top MSOs Connectivity Pivot

Street Talk Episode 40 - Digital Banks Take a Page Out of 'Mad Men'

Power Forecast Briefing: As retirements accelerate, can renewable energy fill the gap?

2019 Credit Risk Perspectives: Is The Credit Cycle Turning? A Fundamentals View

Kenya's Family Bank to shed jobs; Mozambican banks 'in good health'

PEtransactions on the rise: Private equity transactions in Africa reacheda level of $900 million in the first half, with 83 deals and $1.1 billion offunds mobilized, Agence Ecofin reports.For full year 2015, transactions were at $2.5 billion, with $4.3 billion ofcapital raised.

* Algeria's Compagnie Centrale de Réassurance, with $236 million ofpremiums written in 2015, is seeking to extend its services to the rest ofAfrica, Financial Afrik reports.

* U.S.-based Och-Ziff Capital Management Group LLC agreed asettlement of more than $412 million for the alleged bribery of top officialsin several African nations by its former employees, City A.M. reports.


Saudi bankstold to restructure certain loans: The Saudi Arabian Monetary Agency askedlocal banks to reschedule the payment of consumer loans at no cost or penaltiesfor clients affected by a government decision to cut bonuses and freeze thesalaries of public sector workers, Argaam writes. Thepay cut is meant to help curb a budget deficit caused by low oil prices.

* Point-of-sale transactions in Saudi Arabia, including ATM,debit and credit cards, declined 6% to 15.3 billion riyals in August from 16.3billion riyals a year earlier, Argaam reports,citing central bank data. As many as 46 million transactions were carried outin 266,000 points of sale including, shopping malls, pharmacies and retailstores.

* Gulf Cooperation Council member states intend to raise $50billion in bonds to cut deficits, which are expected to expand as a slump inoil prices persists, the Times of Oman writes,citing a study by Fisch Asset Management.

* Arab Petroleum Investments Corp. issueda $300 million, five-year floating-rate note in Taiwan, the first so-calledFormosa bond launched outside Saudi Arabia.

* The Qatar Stock Exchange will introduce regulated margintrading this week in a bid to improve liquidity on the stock market and providenew financing channels for investors, Reuters reports,citing Qatar Stock Exchange CEO Rashid al-Mansoori.

* Qatari funds Paramount Services Holdings and SupremeUniversal Holdings, which have owned a combined stake of 6% in since mid-2014, haveincurred a €1 billion loss on their investments, as the German bank's stockprice has plummeted 60% since they backed its €8.5 billion capital increase twoyears ago, The Daily Telegraph writes.

* UAE insurers posted profits in the first half, showingsigns of recovery after recording aggregate losses in the year-ago period,despite economic pressure on the GCC from sustained low oil prices, CPIFinancial notes,citing an S&P Global Ratings report.

* Al Sagr Cooperative Insurance approveda 20% cash dividend, or 2 riyals per share, for fiscal year 2015.

* Kuwait's banking association said recent regulations setby central bank do not affect the operations and activities of local banks,adding that the measures were issued following discussions with banks, Al Rai reports.

* UnionNational Bank - PJSC priced a $600 million five-year seniorunsecured bond at a spread of 170 basis points over the U.S. dollar five-yearmidswap rate and a coupon of 2.750% per annum, Thomson Reuters' Zawya reports.The issue was 3x oversubscribed.

* In Algeria, 11 banks are launching e-payments this week incoordination with the central bank, ElWatan reports.

* IMF conditions for an Egyptian bailout deal will includesubsidy reform, flotation of the pound and an introduction of VAT, Daily News Egypt reports.Arqaam Capital believesthe government will avoid a fully liberalized system, instead introducing ahybrid system combining some traits of a managed exchange with a free float.


Family Bank tocut jobs: Kenya-based FamilyBank Ltd. intends to lay off several staff in the next two weeks tocut costs and boost its overall performance, The Star says.The bank has offered a voluntary early retirement program to certain employeesas of Oct. 1.

* Central Bank of Nigeria Governor Godwin Emefiele told The Banker that the central bank willprioritize price and financial system stability to boost economic growth andentice foreign investors as the country tries to get out of recession, Reuters notes.

* Nigerian deposit money banks have yet to allow checkpayments into savings accounts two months after the central bank told them todo so, The Nation reports.The lenders said they were still upgrading their systems to comply with thecentral bank's directive.

* Nigerian bankers, entrepreneurs and foreign investorscautioned that the government's "fixing" of the foreign exchangesystem is fueling corruption, the FinancialTimes writes.Nigeria shifted to a "purely market-driven" forex system three monthsago, dropping the naira's peg to the U.S. dollar.

* The Bank of Ghana will renounce its ownership inNational Investment BankLtd. and AgriculturalDevelopment Bank Ltd., where it holds stakes of 44.06% and 48.17%,respectively, The Ghanaian Times writes,citing Millison Narh, first deputy governor at the central bank. The centralbank is seeking to transfer its shares in both banks to the government, whowill then become their majority shareholders.

* Liberia will launch a stock market, Agence Ecofin reports,with President Ellen Johnson Sirleaf introducing two bills creating aregulatory framework.

* The Central Bank of Egypt announced a $3 billion rise innet foreign reserves last month, EgyptIndependent says.The reserve level is up at $19.59 billion, still down from $36 billion beforeits 2011 revolution.


Mozambique saysbanks 'in good health': Joana Matsombe, head of banking supervision at theBank of Mozambique, said the country's banking system is "in goodhealth," after Moza BancoSA was put under emergency administration, Reuters notes.The bank ran into difficulties after its solvency ratio fell below the 8%minimum requirement due to an incomplete recapitalization and a quick expansionof its branch network. Authorities plan to stabilize the bank and then sell itin a process expected to last for at least six months, Bloomberg News says.

* Angolan President José Eduardo dos Santos announced a fullrestructuring of the administrative board of Banco de Poupança e Crédito SA. Dos Santos appointedCristina Florência Dias Van-Dúnem nonexecutive president of the board and ZinhoBaptista Manuel executive president, AgênciaAngola Press notes.

* The South African Reserve Bank may concludeits policy tightening cycle should conditions develop in line with currentforecasts. The central bank, however, noted that loosening monetary policywould require a substantial, sustained improvement in forecast inflation tobetween the 3% and 6% target range.

* South Africa's Financial Services Board fined 's Sanlam CollectiveInvestments 10,000 rand after failing to carry out a quarterly incomedistribution as dictated by two funds' supplemental deeds, accordingto Independent Online. The FSB, meanwhile, fined Lion of Africa LifeAssurance Co. 200,000 rand for canceling several funeral insurance groupschemes without notifying the Registrar of Long-term Insurance or policyholders.


Asia-Pacific: Australian banks to face probe; Canadian fund manager to buy stakein Edelweiss unit

Europe: Maysets Article 50 date; ING downsizes; no Deutsche US deal yet

Latin America: Colombians reject FARC peace deal; MAPFRE Chile gets new CEO

North America: Janus, Henderson to merge; Illinois ready to suspend business withWells

North America Insurance: Wisconsin health co-op gets capital infusion; health insurers preferHMO over PPO plans

SherylObejera, Henni Abdelghani, Pádraig Belton and Mariana Aldano contributed tothis report.

The DailyDose Middle East and Africa has an editorial deadline of 5 a.m. London time.Some external links may require a subscription.

Technology, Media & Telecom
Broadband Only Homes Skyrocket In 2018 Validating Top MSOs Connectivity Pivot


The segment stood at an estimated 23.6 million as of Dec. 31, 2018, accounting for 24% of all wireline high-speed data homes.

The following post comes from Kagan, a research group within S&P Global Market Intelligence.

To learn more about our TMT (Technology, Media & Telecommunications) products and/or research, please request a demo.

Mar. 20 2019 — The U.S. broadband-only home segment logged its largest net adds on record in 2018, validating Comcast Corp.'s and Charter Communications Inc.'s moves to make broadband, or connectivity, the keystone of their cable communication businesses.

The size and momentum of the segment also put in perspective the recent high-profile online-video video announcements by the top two cable operators as well as AT&T Inc.'s WarnerMedia shake-up and plans to go toe-to-toe with Netflix in the subscription video-on-demand arena in the next 12 months.

We estimate that wireline broadband households not subscribing to traditional multichannel, or broadband-only homes, rose by nearly 4.3 million in 2018, topping the gains from the previous year by roughly 22%. Overall, the segment stood at an estimated 23.6 million as of Dec. 31, 2018, accounting for 24% of all wireline high-speed data homes.

For perspective, broadband-only homes stood at an estimated 11.3 million a mere four years ago, accounting for 13% of residential cable and telco broadband subscribers.

The once all-powerful, must-have live linear TV model, which individuals and families essentially treated as a utility upon moving into a new residence, increasingly is viewed as too expensive and unwieldy in the era of affordable, nimble internet-based video alternatives. This has resulted in a sizable drop in penetration of occupied households.

As a result, continued legacy cord cutting is baked in and broadband-only homes are expected to continue to rise at a fast clip, with the segment's momentum in the next few years compounded by Comcast's, Charter's and AT&T's ambitious moves into online-video territory.

Note: we revised historical broadband-only home estimates as part of our fourth-quarter 2018, following restatements of historical telco broadband subscriber figures and residential traditional multichannel subscriber adjustments.

Learn more about Market Intelligence
Request Demo

Q4'18 multichannel video losses propel full-year drop to edge of 4 million

Learn more

Q4'18 multiproduct analysis sheds more light on video's fall from grace

Learn more

Listen: Street Talk Episode 40 - Digital Banks Take a Page Out of 'Mad Men'

Mar. 20 2019 — Some fintech companies are making hay with digital platforms that tout their differences with banks, even though they are often offering virtually the same products. In the episode, we discuss with colleagues Rachel Stone and Kiah Haslett the deposit strategies employed by the likes of Chime, Aspiration and other incumbent players such as Ally Financial, Discover and Capital One. Those efforts conjure up memories of a Don Draper pitch in Mad Men and likely will enjoy continued success.

Learn more about Market Intelligence
Request Demo

No content (including ratings, credit-related analyses and data, valuations, model, software or other application or output therefrom) or any part thereof (Content) may be modified, reverse engineered, reproduced or distributed in any form by any means, or stored in a database or retrieval system, without the prior written permission of Standard & Poor's Financial Services LLC or its affiliates (collectively, S&P).

Watch: Power Forecast Briefing: As retirements accelerate, can renewable energy fill the gap?

Mar. 19 2019 — Steve Piper shares the outlook for U.S. power markets, discussing capacity retirements and whether continued development of wind and solar power plants may mitigate the generation shortfall.

Learn more about Market Intelligence
Request Demo

Credit Analysis
2019 Credit Risk Perspectives: Is The Credit Cycle Turning? A Fundamentals View

Mar. 15 2019 — On November 20, 2018, a joint event hosted by S&P Global Market Intelligence and S&P Global Ratings took place in London, focusing on credit risk and 2019 perspectives.

Pascal Hartwig, Credit Product Specialist, and I provided a review of the latest trends observed across non-financial corporate firms through the lens of S&P Global Market Intelligence’s statistical models.1 In particular, Pascal focused on the outputs produced by a statistical model that uses market information to estimate credit risk of public companies; if you want to know more, you can visit here.

I focused on an analysis of how different Brexit scenarios may impact the credit risk of European Union (EU) private companies that are included on S&P Capital IQ platform.

Before, this, I looked at the evolution of their credit risk profile from 2013 to 2017, as shown in Figure 1. Scores were generated via Credit Analytics’ PD Model Fundamentals Private, a statistical model that uses company financials and other socio-economic factors to estimate the PD of private companies globally. Credit scores are mapped to PD values, which are based on/derived from S&P Global Ratings Observed Default Rates.

Figure 1: EU private company scores generated by PD Model Fundamentals Private, between 2013 and 2017.

Source: S&P Global Market Intelligence.2 As of October 2018.

For any given year, the distribution of credit scores of EU private companies is concentrated below the ‘a’ level, due to the large number of small revenue and unrated firms on the S&P Capital IQ platform. An overall improvement of the risk profile is visible, with the score distribution moving leftwards between 2013 and 2017. A similar picture is visible when comparing companies by country or industry sector,3 confirming that there were no clear signs of a turning point in the credit cycle of private companies in any EU country or industry sector. However, this view is backward looking and does not take into account the potential effects of an imminent and major political and economic event in the (short) history of the EU: Brexit.

To this purpose, S&P Global Market Intelligence has developed a statistical model: the Credit Analytics Macro-scenario model enables users to study how potential future macroeconomic scenarios may affect the evolution of the credit risk profile of EU private companies. This model was developed by looking at the historical evolution of S&P Global Ratings’ rated companies under different macroeconomic conditions, and can be applied to smaller companies after the PD is mapped to a S&P Global Market Intelligence credit score.

“Soft Brexit” (Figure 2): This scenario is based on the baseline forecast made by economists at S&P Global Ratings and is characterized by a gentle slow-down of economic growth, a progressive monetary policy tightening, and low yet volatile stock-market growth.4

Figure 2: “Soft Brexit” macro scenario.5

Source: S&P Global Ratings Economists. As of October 2018.

Applying the Macro-scenario model, we analyze the evolution of the credit risk profile of EU companies over a three-year period from 2018 to 2020, by industry sector and by country:

  • Sector Analysis (Figure 3):
    • The median credit risk score within specific industry sectors (Aerospace & Defense, Pharmaceuticals, Telecoms, Utilities, and Real Estate) shows a good degree of resilience, rising by less than half a notch by 2020 and remaining comfortably below the ‘b+’ threshold.
    • The median credit score of the Retail and Consumer Products sectors, however, is severely impacted, breaching the high risk threshold (here defined at the ‘b-’ level).
    • The remaining industry sectors show various dynamics, but essentially remain within the intermediate risk band (here defined between the ‘b+’ and the ‘b-’ level).

Figure 3: “Soft Brexit” impact on the median credit risk level of EU private companies, by industry.

Source: S&P Global Market Intelligence. As of October 2018.

  • Country Analysis (Figure 4):
    • Although the median credit risk score may not change significantly in certain countries, the associated default rates need to be adjusted for the impact of the credit cycle.6 The “spider-web plot” shows the median PD values for private companies within EU countries, adjusted for the credit cycle. Here we include only countries with a minimum number of private companies within the Credit Analytics pre-scored database, to ensure a robust statistical analysis.
    • Countries are ordered by increasing level of median PD, moving clock-wise from Netherlands to Greece.
    • Under a soft Brexit scenario, the PD of UK private companies increases between 2018 and 2020, but still remains below the yellow threshold (corresponding to a ‘b+’ level).
    • Interestingly, Italian private companies suffer more than their Spanish peers, albeit starting from a slightly lower PD level in 2017.

Figure 4: “Soft Brexit” impact on the median credit risk level of EU private companies, by country.

Source: S&P Global Market Intelligence. As of October 2018.

“Hard Brexit” (Figure 5): This scenario is extracted from the 2018 Stress-Testing exercise of the European Banking Authority (EBA) and the Bank of England.7 Under this scenario, both the EU and UK may go into a recession similar to the 2008 global crisis. Arguably, this may seem a harsh scenario for the whole of the EU, but a recent report by the Bank of England warned that a disorderly Brexit may trigger a UK crisis worse than 2008.8

Figure 5: “Hard Brexit” macro scenario.9

Sources:”2018 EU-wide stress test – methodological note” (European Banking Authority, November 2017) and “Stress Testing the UK Banking system: 2018 guidance for participating banks and building societies“ (Bank of England, March 2018).

Also in this case, we apply the Macro-scenario model to analyze the evolution of the credit risk profile of EU companies over the same three-year period, by industry sector and by country:

  • Sector Analysis (Figure 6):
    • Despite all industry sectors being severely impacted, the Pharmaceuticals and Utilities sectors remain below the ‘b+’ level (yellow threshold).
    • Conversely, the Airlines and Energy sectors join Retail and Consumer Products in the “danger zone” above the ‘b-’ level (red threshold).
    • The remaining industry sectors will either move into or remain within the intermediate risk band (here defined between the ‘b+’ and the ‘b-’ level).

Figure 6: “Hard Brexit” impact on the median credit risk level of EU private companies, by industry.

Source: S&P Global Market Intelligence. As of October 2018.

Learn more about Credit Analysis
Click Here

  • Country Analysis (Figure 7):
    • Under a hard Brexit scenario, the PD of UK private companies increases between 2017 and 2020, entering the intermediate risk band and suffering even more than its Irish peers.
    • Notably, by 2020 the French private sector may suffer more than the Italian private sector, reaching the attention threshold (here shown as a red circle, and corresponding to a ‘b-’ level).
    • While it is hard to do an exact like-for-like comparison, it is worth noting that our conclusions are broadly aligned with the findings from the 48 banks participating in the 2018 stress-testing exercise, as recently published by the EBA:10 the major share of 2018-2020 new credit risk losses in the stressed scenario will concentrate among counterparties in the UK, Italy, France, Spain, and Germany (leaving aside the usual suspects, such as Greece, Portugal, etc.).

Figure 7: “Hard Brexit” impact on the median credit risk level of EU private companies, by country.

Source: S&P Global Market Intelligence. As of October 2018.

In conclusion: In Europe, the private companies’ credit risk landscape does not yet signal a distinct turning point, however Brexit may act as a pivot point and a catalyst for a credit cycle inversion, with an intensity that will be dependent on the Brexit type of landing (i.e., soft versus hard).

1 S&P Global Ratings does not contribute to or participate in the creation of credit scores generated by S&P Global Market Intelligence.
2 Lowercase nomenclature is used to differentiate S&P Global Market Intelligence credit scores from the credit ratings issued by S&P Global Ratings.
3 Not shown here.
4 Measured via Gross Domestic Product (GDP) Growth, Long-term / Short-term (L/S) European Central Bank Interest Rate Spread, and FTSE100 or STOXX50 stock market growth, respectively.
5 Macroeconomic forecast for 2018-2020 (end of year) by economists at S&P Global Ratings; the baseline case assumes the UK and the EU will reach a Brexit deal (e.g. a “soft Brexit”).
6 When the credit cycle deteriorates (improves), default rates are expected to increase (decrease).
7 Source: “2018 EU-wide stress test – methodological note” (EBA, November 2017) and “Stress Testing the UK Banking system: 2018 guidance for participating banks and building societies”. (Bank of England, March 2018).
8 Source: “EU withdrawal scenarios and monetary and financial stability – A response to the House of Commons Treasury Committee”. (Bank of England, November 2018).
9 As a hard Brexit scenario, we adopt the stressed scenario included in the 2018 stress testing exercise and defined by the EBA and the Bank of England.
10 See, for example, Figure 18 in “2018 EU-Wide Stress Test Result” (EBA November 2018), found at:

Learn more about Market Intelligence
Request Demo

2019 Credit Risk Perspectives: Is The Credit Cycle Turning? A Market-Driven View

Learn More