PRESS CENTRE

Green bond-financed projects are necessary but not sufficient In its September Quarterly Review, the Bank of International Settlements (BIS) published a much-needed article that analysed the impact of fighting the climate crisis at the firm-level from corporate projects funded by green bonds 05/10/2020 - Mitch Reznick

Credit Investors not valuing their privacy Evidence shows that bonds issued by private companies offer no premium versus those with public equity market capitalization. Historic data coupled with elevated risks highlight why Fraser Lundie, Head of Credit at the international business of Federated Hermes, views this as a mispricing. 17/09/2020 - Fraser Lundie

Why sustainability is here to stay In his latest report, 'The sustainability of sustainability: green finance during the pandemic’, Mitch Reznick, Head of Research and Sustainable Fixed Income, International at Federated Hermes, explains why sustainability is far more than a passing trend. 23/06/2020 - Mitch Reznick

How companies respond to risk: engaging during a crisis Aaron Hay, Lead Engager - Fixed Income, International at Federated Hermes, discusses some of the companies his team has been engaging with during the Covid-19 crisis and how they have been responding to both the short and long-term issues. 16/06/2020 - Aaron Hay

Federated Hermes expands Fixed Income team with Investment Director hire Reflecting the growing interest from clients and prospects in fixed-income solutions, Federated Hermes today announced the appointment of Anna Karim as Investment Director in its Fixed Income team in London. 08/06/2020 - Andrew Jackson

High Yield can be the White Knight of the Income Crisis Marking the 10-year anniversary of our Global High Yield capabilities, Fraser Lundie, CFA, Head of Credit, explains why investors on the hunt for income amid the dividend drought should turn to high yield as a long-term, sustainable alternative. 14/05/2020 - Fraser Lundie

Discerning dislocations in credit markets Markets have been roiled by extreme volatility through the course of March, driving major dislocation between recent price action and intrinsic value. Andrew Jackson, Head of Fixed Income at the International Business of Federated Hermes, assesses four sectors where pricing and value seem particularly distorted. 31/03/2020 - Andrew Jackson

Federated Hermes & Beyond Ratings: New research highlights strong correlation between ESG factors and developed markets sovereign spreads In a new study conducted with Beyond Ratings, ‘Pricing ESG risk in sovereign credit, part II’, Federated Hermes reveals... 03/03/2020 - Michael Viehs

Credit view: the impact of the coronavirus on industry sectors The novel coronavirus spreading from China has shaken markets and clouded the outlook for global growth. 07/02/2020

ESG rigours must be applied to ABS market "Add a short extract from this post, that is 10-15 words." 11/11/2019 - Andrew Lennox

UBS, Federated Investors, Inc. and Hermes Investment Management Launch Innovative Fixed Income Impact Funds Federated Investors Inc., Hermes Investment Management and UBS today announced the launch of new SDG Engagement High Yield Credit funds 26/09/2019 - Saker Nusseibeh, CBE

Not all ships are rising on the tide In the latest 360°, Hermes’ Fixed Income Quarterly Report, Andrew Jackson, Head of Fixed Income at Hermes Investment Management, explores how investors can navigate the growing negative-yield credit landscape. 04/09/2019 - Andrew Jackson

New research highlights correlation between ESG and sovereign spreads Countries that score highest on environmental, social and governance (ESG) issues benefit from tighter credit default swap (CDS) spreads than those with lower ESG scores... 01/07/2019

Hermes strengthens private debt platform with new hire Hermes has announced the appointment of Kevin Roche as a Director for Private Debt and CLO’s. 17/05/2019

Fuelling the M&A pipeline in US oil and gas Audra Stundziaite, Deputy Head of Credit Research, explores the theme of consolidation in the energy sector. 29/04/2019 - Audra Delport

Finding the value in EM credit "Add a short extract from this post, that is 10-15 words." 03/04/2019 - Andrey Kuznetsov

End-of-bull market rumours may be exaggerated Turbulence, disruption and uncertainty have always provided instances of opportunity for the savvy fixed income investor. 05/03/2019 - Andrew Jackson

Keeping the engine running in the auto sector Ilana Elbim, Credit Analyst, Hermes Investment Management, explains that the insights she gained from the conference floor at this year’s show reaffirmed convictions in a long-held relative-value trade involving two giants from the Motor City. 07/02/2019 - Ilana Elbim

Can credit investors find stability in the volatile energy sector? 04/02/2019

The benefit of the bulk A breed of insurers under-researched by credit investors is taking on the liabilities of more UK pension funds.  In his latest report, ‘UK ‘bulks’ – weighty opportunities in a slim sector’, Filippo Alloatti, Senior Credit Analyst, Hermes Investment Management, examines this niche area of the market, highlighting how it could potentially yield attractive returns. 28/01/2019

Hermes expands global fixed income team with private debt hire Hermes Investment Management, the £36 billion manager, has announced the expansion of its global fixed income team, with the appointment of Carina Spitzkopf as a Director for Private Debt. 21/01/2019 - Patrick Marshall

Controlling disruption exposure increasingly important in high-yield portfolios After navigating through Q3, which historically tends to be a difficult quarter, several common themes are beginning to emerge across US money centre banks. Our thesis on the sector remains intact, with fundamentals continuing to improve despite pressure on revenues. Citigroup was the standout this quarter, but Bank of America lagged. Several years of the so-called zero interest rate policy are taking a toll on net interest incomes for the sector and forcing the banks into aggressive rounds of cost cutting. Regulation and oversight remains the main driver of industry fundamentals, credit profiles and spread movements. Senior and T2 issuances will likely increase on Orderly Liquidation Authority and Total Loss Absorbing Capital (TLAC) needs. We believe increased loss absorption capital will be positive for our bonds. P&Ls: Reported profitability did range from 7% of return on equity at Bank of America to 12% at Wells Fargo, which had the help of an outsized $0.9bn of equity gains Soft mortgage banking trends came to us as no surprise given further tightening of mortgage standards in the first half of the year, as well as lower volumes. We will be watching these mortgage lending standards closely, as mortgages represent a little less of 70% of US consumer debt and could be drag on GDP growth forcing the US Federal Reserve to keep rates lower for longer. 08/01/2019 - Fraser Lundie

Hermes expands global credit team with emerging market debt appointment Hermes Investment Management, the $46.9 billion manager, has announced the appointment of Nachu Chockalingam as Senior Emerging Market Debt Portfolio Manager. Based in London, Nachu reports into Fraser Lundie, Co-Head of Credit. The appointment is representative of the firm’s approach to providing current and prospective clients with access to all areas of global credit markets. Nachu will help manage the performance and risk of existing emerging market allocations across all liquid credit strategies. This includes the Hermes Unconstrained Credit Fund, which was launched in May 2018 and has since raised $386 million[1]. 25/11/2018 - Fraser Lundie

US homebuilders - on strong foundations? US homebuilders have been hurt this year by concerns that rising interest rates could keep buyers at bay. But, as the sector continues to report strong demand for new housing, Fraser Lundie, Co-Head of Credit and Anna Chong, Credit Analyst, Hermes Investment Management ask: is the backdrop for US homebuilders favourable? The recent rise in interest rates – coupled with expectations of further rate hikes from the US Federal Reserve – has weighed heavily on US homebuilders this year: investors fear higher mortgage rates will weaken demand. But despite talk of a slowdown, industry fundamentals are still supportive of US homebuilders. Strength in the economy and labour market have boosted demand for housing. In Q2, US economic growth enjoyed its best performance in almost four years, increasing at an annualised rate of 4.2%, while unemployment remains low at 3.9% and job creation is solid. In July, employers added 157,000 jobs. Moreover, homebuilders’ recent robust earnings results demonstrate that demand has not been impacted by rising mortgage rates, with many reporting strong orders – an indicator of future revenue for homebuilders. Tight existing home inventory should also spur demand for new builds. Meanwhile, in a post-earnings call with analysts last month, Toll Brothers’ Chief Executive Douglas Yearley pointed to a structural shift towards the new-home industry – with buyers wanting to “create a one-of-a-kind custom home” rather than live in existing homes. 17/09/2018 - Fraser Lundie