FCF Credit Monitor – Q4 2020 published

FCF Fox Corporate Finance GmbH is delighted to publish the new “FCF Credit Monitor – Q4 2020”.

The FCF Credit Monitor is a comprehensive report / analysis of the pricing and yield structure in the European bond market and is published by FCF on a quarterly basis.

Key insights of Q4 2020 are:

  • The analysis of the average bond yields by sector across all rating classes shows the significant industry differences. While the utilities sector shows the lowest yields (1Y: ~ 1.00%, 10Y: ~ 2.00%), the energy sector shows the highest yields across all rating classes (1Y: 2.75%, 10Y: 3.70%)
  • The yield curve analysis by rating class across all sectors shows that investment grade rating classes (AAA-BBB) on average have negative yields for bond maturities of up to 2 years (BBB) and even 7 years (AAA). Across all sectors, Spreads between yield curves within the investment grade category are relatively small, while spreads between yield curves within the non-investment grade category (starting at BB) are wider. Bonds which are issued by a CCC-rated corporate show a high, inverse yield curve (1Y: 11.30%, 10Y: 10.26%)
  • Economical and political events have significant influences on the bond market. In the near past, the covid-19 pandemic caused average yields across all sectors and rating classes to jump dramatically above 7.00%. Since then, global government programs and the development of a vaccine let yields decrease below pre-covid-19 levels

To access the full report, please click here.

By Arno Fuchs, Marcel Lange, Mathias Übler und Yasmin Herrmann