simon jacques
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"The downgrade of Noble Group to junk status is worrisome, but the main story is about the evolution of the commodity price downtrend. 1st round effects were felt in macro indicators (lower CapEx & growth for producers and following FX/interest rate adjustments). 2nd round effects will be about commodity exporters' governments reactions."
Those effects will dominate in 2016 said Sacha Duparc, Head trader and structurer at Banque Cantonale Vaudoise.
It looks shaky for commodities and commodity trading firms in 2016 and in a nutshell some traders are naked.
Is there a way to bet against troubled traders with liabilities exposure tied to the commodity curve ? Maybe Noble Group, traded on the SGX.
http://www.zerohedge.com/news/2016-01-02/noble-group%E2%80%99s-collateral-margin-call
Moody’s has downgraded Noble Group to junk last week and Standard & Poor's is likely to be next to cut Noble's rating to “junk” as the rating agency remains skeptical about the liquidity headroom of the trader.
Noble Group is left with only 1B$ of unutilized committed borrowing facilities and $900M of cash ready available to meet $2.966B of debt scheduled in the next 12 months.
Moreover, Noble Group counts on the completion of the Noble Agri stake divesture to reap $750M, a transaction which may not be completed by February 2016.
Adding the 1B$ of unused uncommitted borrowing facilities plus the $750M of Noble Agri and the $900M of cash that Noble claims to have, Noble is still short by $316M.
With the S&P downgrade, the total collateral margin call on Noble Group could be as much as $3.4B.
Those effects will dominate in 2016 said Sacha Duparc, Head trader and structurer at Banque Cantonale Vaudoise.
It looks shaky for commodities and commodity trading firms in 2016 and in a nutshell some traders are naked.
Is there a way to bet against troubled traders with liabilities exposure tied to the commodity curve ? Maybe Noble Group, traded on the SGX.
http://www.zerohedge.com/news/2016-01-02/noble-group%E2%80%99s-collateral-margin-call
Moody’s has downgraded Noble Group to junk last week and Standard & Poor's is likely to be next to cut Noble's rating to “junk” as the rating agency remains skeptical about the liquidity headroom of the trader.
Noble Group is left with only 1B$ of unutilized committed borrowing facilities and $900M of cash ready available to meet $2.966B of debt scheduled in the next 12 months.
Moreover, Noble Group counts on the completion of the Noble Agri stake divesture to reap $750M, a transaction which may not be completed by February 2016.
Adding the 1B$ of unused uncommitted borrowing facilities plus the $750M of Noble Agri and the $900M of cash that Noble claims to have, Noble is still short by $316M.
With the S&P downgrade, the total collateral margin call on Noble Group could be as much as $3.4B.
